4:11 leet01-xythos.content.blackboardcdn.com PESTEL ANALYSIS 1 of 1 ILLUSTRATION 2.3 Uber drives into trouble The Uber taxi-hailing company has often run up against local regulations. The inspiration for the Uber's taxi-hailing app came background checks after it emerged the rapist had on a snowy night in Paris in 2008, when co-found- been previously accused of assaulting women. The vic- ers Travis Kalanick and Garrett Camp couldn't find a tim lodged a lawsuit in San Francisco (later dropped) cab. Uber began business in Kalanick's home state of and Uber was temporarily banned by the Delhi local California, launching in San Francisco in 2011. With authorities. early funding from renowned investment bank Goldman Sachs and Google Ventures, Uber expanded rapidly. At aggression. The motto of the company's growth team the end of 2015, the company was able to celebrate te billionth ride. It was operating in about 400 cities A third source of controversy is Uber's apparent is: it is easier to ask for forgiveness than permission'. Uber is often careless of local regulations. Local offi- cials regarded by Uber as obstructive have allegedly become the targets of systematic attack. A hostile offi- around the world, from Abu Dhabi to Zurich. Uber's hectic growth was in part aimed at pre-empt- ing competitors. It is technically fairly easy to launch cial in Virginia, United States, was flooded with emails a local taxi-hailing app. Some of Uber's regional com- and calls after Uber distributed his personal contact petitors grew rapidly, for example Lyft in the USA, Didi information to all of its users in the state. A senior Kuaidi in China, Ola in India and GrabTaxi in South- vice president of Uber was widely reported to have east Asia. In December 2015, these four rivals to suggested that Uber hire a team with a million-dollar Uber declared a strategic alliance, promising to share budget to dig into the personal lives and backgrounds ss, ns: of media reporters critical of Uber: the company was obliged to disown the suggestion. During a bitter dis- customers technologies and offer common services travelling from one region to another. The pursuit of growth has frequently got Uber into pute in Portland, Oregon, the transportation commis- legal trouble. There are three areas in which Uber's sioner called Uber management 'a bunch of thugs'. strategy is particularly controversial. First, there is the contention that the company does not employ its driv- ers, but just offers a technology platform on which entrepreneur is the way of an adventurer..... It can drivers and passengers freely interact. With drivers be conveyed as aggressive, but it is doing things people considered independent contractors, the company think is against conventional wisdom.... Ultimately, appears absolved from costly obligations such as insur- ance, minimum wages, overtime pay and pensions. This has helped Uber undercut the prices of traditional 19 January 2016; Forbes, 17 August 2015. taxi services: in New York, the traditional yellow cabs saw a 14 per cent drop in business after the launch of Uber. In several localities, including its home state of California, the independent contractor status of Uber's drivers has faced legal challenges, leading to aes by nal jal In early 2016, CEO Travis Kalanick gave his view of Uber's sapproach to the Times of India: The way of an ald all rules have to bend towards people and progress. Main sources Financial Times, 15 September 2015; Times of india, ent ne local rs. Questions 1 Using the concept of 'varieties of capitalism', in which countries would you expect Uber to most successful and in which less so? local bans or fines. Second, by comparison with becoming a licensed taxi-driver, it is relatively easy for people to become Uber drivers. This creates safety risks, with cases of Uber drivers even assaulting passengers. In 2015, an Uber driver in Delhi was convicted of raping a passen- ger. Uber was accused of failing to conduct adequate tal ny 2 What are the costs and benefits of Uber's aggressive approach to growth? ve he en ve 47