Tougher competition for Uber in London

Uber has been the only serious private hire app-based company in London and even in UK to operate for 5 years. Competition was close to zero apart from black cabs, Addison Lee and local mini cab offices. In a time where Uber is going through struggles legally and in the media, where are Uber competitors? VianVan launched recently but who else might take the lead if Uber do not get its provisional license renewed for good?  Other competitors are on their way.

Big names are of the party

ViaVan, the first true rival

As a result of a partnership between Via and Mercedz-Benz, ViaVan app has been launched in London in May 2018. It gave for the first time to drivers the possibility to be multi-apping along with the Uber app. And here is the benefit of any app-based competition. Cabbies can run both apps at the same time and take the first job coming from any of the two.

Drivers seem to be happy with the app in terms of earning. The flex mode includes lots of rocket fares, the equivalent of surge. Rocket fares in flex mode are very attractive given that the commission is only 15%.  As ViaVan is still creating its customer base, the waiting time can be slightly longer than with Uber. Week-end shifts on the app give more requests.

Only in zone 1 & 2, ViaVan has still not communicated about whether they are going to expand to other areas or operate in airports.

The banned Taxify prepares its comeback

After its failed launch in 2017, Taxify is decided to get back in the London market. The Estonian app started a proper application to hold a license. As it can take months for TfL to reply, we should not be seeing the app operating in London before at least six months. But the app has already made good preparation to be ready and starting promptly if the license is granted. There are already 5000 drivers who signed up with the company. This is enough to supply enough rides at the beginning of its operations.

Then comes the question of what Taxify can offer to drivers. Two main things that are a commission rate of 15% and the possibility to get cash payments. The rate matches ViaVan’s one and would be an asset to attract even more drivers. The cash system may seem good to some drivers but it raises a safety issue that  most based app drivers have never met.

There was one major barrier that the firm was facing. It is its name. Actually, TfL granted the name “Taxi” to black cabs only. Every single private hire company cannot use this word as a brand. Those who did had to remove it or suffered sanctions as a consequence. Therefore, it seems that Taxify has resolved the issue by choosing Hopp as a brand for its services in London.

Ola, from New Delhi to London

Ola is an Indian company that is leading the market in India and is present in 110 cities around the world. It has just started its operation in UK. They are operating in Wales and have the intention to expand to the South West of the country. We do not have any clear message regarding their arrival in London.  The company stated that they are in “constructive conversation” with TfL but no definite launching date is in view. As they have not even started to hire drivers in the capital, we could reasonably conclude that it will not be before at least 6 months.

The original side with Ola is that the company accepts on their platforms both private hire and taxi drivers. Will that work in London? We could be sceptic about that after what happened to Hailo when it wanted to introduce the same thing. It is not sure that London black cab drivers will be compliant.

Uber competitors from London

Other players are bound to have their say in the share of this market.  These are players with less means and financial resources but are keen to break through this particular private hire app-based London market.

First, there is London Carriages who was supposed to launch in May 2018. After advertising through social media and forums, the company has created an app with attractive fares but is still not operating as an app-based ride provider.  Drivers’ events have been held and an app has been sent to them. But the launch of the app for customers has been postponed multiple times. According to them, they are waiting for an approval from TfL in order to get started. But are they really going to start one day? We hope so even if the silence around its media and communication means is not a good sign.

MiWhip is the app that is making a lot of noise at the moment.  The app is made and managed, as stated in their slogan, “for Londoners by Londoners”.  The marketing strategy of the company looks strong and well thought with a serious activity on social media and a sense of the details. MiWhip was awarded a licence in October by TfL. They expect to launch by Christmas. But at the moment, only the drivers’ app is available on play and apple stores.  That raises the question about how the app is going to attract customers and make its customer base. With about 2000 drivers on the platform and no customer app still, MiWhip is running out of time to meet its deadlines.

Local cab apps unite to resist

Traditional local cabs have reacted to the change in the market and have started making their own apps to face the competition. Data cars  is an app based in South East London that has about 300 drivers at its service to deliver rides in the area and further. Greyhound cars is on the same model but is located is South West London. About 50 mini cab operators are involved in the app. That shows the new trend and tactic used by local cab companies to face the competition of the big firms like Uber and ViaVan.

Following the quasi monopoly of Uber for many years in London, the tech company is now facing opponents on the ground that test its ability to react to competition and adapt its services, pricing and communication strategies to it. As Uber competitors are trying to seduce a maximum of drivers, we expect that this will have a positive affect on the relationship between Uber and its drivers. That is already showing as Uber starts offering promotions and incentives to drivers after 5 years of no-promotion policy. The competition of Lyft in the USA had the same impact of Uber’s promotion. But there is no news about Lyft arrival in London since its statement of interest a year ago.