Italian taxi drivers’ anti-Uber protest may harm taxi sector itself

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Taxi drivers take part in a demonstration in central Budapest, Hungary, on June 16, 2015. Hundreds of taxi drivers turned up in their yellow cabs at a demonstration against unregulated car-sharing apps such as Uber, demanding the government to carry out a solution. (Xinhua/Attila Volgyi)
Taxi drivers take part in a demonstration in central Budapest, Hungary, on June 16, 2015. Hundreds of taxi drivers turned up in their yellow cabs at a demonstration against unregulated car-sharing apps such as Uber, demanding the government to carry out a solution. (Xinhua/Attila Volgyi)

Taxis in major Italian cities stayed in their garages for the sixth consecutive day Tuesday, in protest that a 25-year-old statute they say is not being applied to limit car-sharing services like Uber.

Taxi drivers take part in a demonstration in central Budapest, Hungary, on June 16, 2015. Hundreds of taxi drivers turned up in their yellow cabs at a demonstration against unregulated car-sharing apps such as Uber, demanding the government to carry out a solution. (Xinhua/Attila Volgyi)
Taxi drivers take part in a demonstration in central Budapest, Hungary, on June 16, 2015. Hundreds of taxi drivers turned up in their yellow cabs at a demonstration against unregulated car-sharing apps such as Uber, demanding the government to carry out a solution. (Xinhua/Attila Volgyi)
The protests started Feb. 16 in Rome, Milan, and Turin, and have since spread to other cities including Bologna, Genoa, and Naples, dramatically slowing transportation in those cities.

Officials representing the drivers were set to start negotiations with government officials Tuesday, but there was still no end in sight.

Daniele Saulli, president of the Rome-based taxi driver industry group Urutaxi Lazio, told Xinhua it is unclear who first organized the work stoppages, and he said only a few taxi drivers are pushing the agenda.

“I’d estimate that 90 percent of taxi drivers would rather be working, but the other 10 percent threatens them so they stay off the streets,” Saulli said.

Several commentators expressed doubts about that take on events. But regardless of the origins of the protests, economists say the taxi drivers are limiting their own prospects by declining to engage and adapt as the transport sector changes.

“In the medium-term, it’s inevitable that the sharing economy will become more relevant,” economist Andrea Giuricin, a fellow with the Bruno Leoni Institute, a Milan think-tank, said in an interview. “We’re only a few years away from driverless cars. What will the taxis do then?”

Officially, the protests are to require non-taxi commercial vehicles to abide by the terms of a 1992 law, amended in 2008, that requires a driver to return to its office after each fare.

But even though protesters do not mention any companies by name, the protests have been cast in the Italian press and among commentators as one designed to strike a clear blow against Uber and other car-sharing services.

The new competition from car sharing services and other transport options is siphoning off business, keeping fares low, and dramatically reducing the value of a taxi permit, which drivers used to sell for hefty sums before retiring.

Drivers say the permits now fetch only around a tenth of the more-than 100,000-euro price tag (105,000 U.S. dollars) they commanded a few years ago.

One of the unintended consequences of the events, however, is that they are pushing people toward Uber and similar services.

The Italian media reported that fares for Uber services rose as much as 400 percent after Feb. 16, a reflection of the company’s algorithm that increases fares when demand is high, in order to entice more drivers to enter into service.

Social media in Italy was flush with reports of people trying out Uber and other services for the first time because taxis were unavailable.

Uber’s Alessio Cimmino told Xinhua the company does not release ridership data. But Francesco Rellini, one of the founders of Scooterino, a Rome-based service that provides rides on two-wheel motor scooters, said in an interview that when taxis are off the roads, it is a boon for his company.

“Each time the taxis stop working, we see demand rise 20 percent or more,” Rellini said. “Once things go back to normal, some of the new clients stick around. They end up getting introduced to our service because they can’t take a taxi, and they continue to use it when it is a good fit for them.”

According to Giuricin, the economist, the strategy being employed by the taxi drivers is a typical one in Italy.

“The first response in this country is always to make things more difficult for the new competition rather than to innovate and adapt,” Giuricin said.

Scooterino’s Rellini agreed: “The taxis are confronting what is happening as if it was 40 or 50 years ago,” he said. “There’s no reason why we can’t all co-exist. But they have to acknowledge the world is changing.” Enditem

Source: Eric J. Lyman, Xinhua/NewsGhana.com.gh

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