For political, economic, and PR reasons, Uber has always been a tough sell to government regulators in London, UK. There have been back-and-forth battles, regulations, pushback, and ongoing arguments about consumer demand and rideshare safety in this major international city. Recently, though, Uber took another blow to its business in the UK when London’s transit authority refused to renew the rideshare company’s operating license.
The rationale given for the refusal is, apparently, “concerns over imposter drivers,” according to multiple media reports of the decision. Authorities say they must tighten restrictions on ride-sharing services, due to increased concern over “passenger safety and security.”
Uber fired back at the decision immediately and publicly, calling the move “extraordinary and wrong,” and vowing to file an appeal very soon. In the meantime, the company may continue operating until the appeal process has run its course, and that issue has been decided. It’s unknown at this time what might happen, as London transit regulators have cited “several breaches that placed passengers and their safety at risk…” in the comments associated with the refused renewal.
In a statement, director of licensing and regulation Helen Chapman said, “While we recognize Uber has made improvements, it is unacceptable that Uber has allowed passengers to get into minicabs with drivers who are potentially unlicensed and uninsured… We cannot be confident that similar issues won’t happen again…”
Uber’s response came from CEO Dara Khosrowshahi, “We understand we’re held to a high bar, as we should be, but this TFL decision is just wrong… Over the last two years, we have fundamentally changed how we operate in London…”
The refusal could signal a serious financial setback for Uber, as the company continues to try to turn a profit in the European market. However, the PR consequences could be an additional stumbling block to Uber as it tries to increase market share. When riders don’t feel safe, they will choose another option, where one is available. That means Uber’s competition has an opening to seize on this decision and promote their brand as “safer” or “more reliable” than Uber.
Whether or not those claims are actually true, the issue is primarily one of public perception. What does the consumer rideshare market believe is true about Uber? Is the company safe or not? If there is doubt and a viable alternative, it’s likely that at least some potential Uber customers will choose that alternative option, regardless of the eventual appeal of the ruling.
That’s the PR issue facing Uber in the UK. The company needs to assure riders that its service is both safe and reliable, regardless of what happens with the license renewal, because the consequences of that aspect of the situation extend far beyond the London city limits.