Relations between Toronto and Uber crash. What’s next for taxis in the city?

The relationship between Toronto and ridesharing giant Uber has taken a turn as new questions about the city’s taxi industry emerge.

A cap on the number of ridesharing drivers in the city was followed by a ratcheting up of rhetoric from Uber, which threatened Toronto with legal action.

The San Francisco-headquartered company says responsibility for the sudden animosity sits with the city.

“The city shifted the tone, the mayor shifted the tone, council shifted the tone,” Laura Miller, director of public policy and communications for Uber Canada, said.

This standoff, marked by regulatory shifts and contrasting perspectives, casts uncertainty on the future of Toronto’s transportation industry.

As the city gears up to address emissions and weighs new rules for hire drivers, the fate of Uber and local taxis hangs in the balance, awaiting a defining resolution by the end of 2024.

Cap on drivers inflames Uber question

For years, local taxi companies and Uber have jostled for a share of people getting home from nights out, the airport or ducking into a car to avoid the rain.

A series of violent incidents reported more recently on the Toronto subway and TTC ridership struggling to rebound from the pandemic has seen them also take their share of transit riders.

Some might guess Uber, with its worldwide brand recognition, is dominating that foot race, but one local taxi firm says it has continued to thrive more than a decade since the tech giant launched in Toronto.

“It is the perception,” Kristine Hubbard, operations manager at Beck Taxi, admitted of the idea many people are tapping an app to call an Uber instead of using a local taxi.

“But (if that’s the case, then) I don’t know who all these people are, calling us every day, using our app, using our website.”

In October, tensions in the ride-hailing and sharing business bubbled back to the surface.

A motion passed under Mayor Olivia Chow set a cap on the number of Ubers that could operate in the city, a policy that has been applied to traditional taxi companies for decades.

It was welcomed as an important first step by the taxi operators and decried by Uber.

“The cap has taken the city backwards in a lot of ways,” Miller told Global News in an interview at the Toronto Region Board of Trade.

She called it “ideologically driven, not evidence-based.”

The ridesharing app is reviewing its legal options, working out if it can take the city to court to overturn the decision.

The company has also emailed some of its drivers and taken out advertisements on social media, encouraging riders to protest the decision.

On Nov. 15, Uber said it was still considering its legal options.

Frustration with city hall

Despite being competitors on the face of it, neither Beck Taxi nor Uber are thrilled with decisions from city hall.

“We were going into the council meeting expecting a debate and discussion around 2030 and EV targets and how we’re going to get there,” Miller said. “And then there’s this arbitrary surprise cap.”

Years of treating taxis one way and applying different rules to Uber — something that appeared to change with the cap — has damaged Hubbard’s view of city hall, too.

“The problem with working in a regulated industry is when the regulator treats the same individuals differently, the trust is gone,” she said. “The trust is gone.”

Before the decision to cap the number of ridesharing drivers — praised by the taxi industry and scorned by Uber — both groups suggest they were able to largely share the Toronto market.

Hubbard said many of Uber’s customers had come from groups who would never have hailed a city taxi in the first place.

“I have two teenage daughters. I recognize that most of their friends are running around using Uber, there’s no question about that,” she said.

“But, when I was a teenager, I wasn’t taking taxis, I was getting on the bus, getting on the subway. And these kids who are using these apps, they’re not necessarily taking away customers who would have used our service.”

Uber makes a similar argument, suggesting that their target market is people who normally choose to drive, not existing taxi customers.

“Our primary target is private car ownership,” Miller said.

The company told Global News that “ridesharing companies and taxis coexist all across the country” and offer more options to residents.

“We know when we bring rideshare into a community, it actually expands the pie for people who are looking for ride options,” Miller added.

Decline in taxi drivers

Whether it is Uber or other factors like the impact of the pandemic on how people live and work, the number of taxi drivers in Toronto has dropped dramatically.

There were just over 11,000 registered taxi and limousine drivers in Toronto in 2013, the year after Uber launched, according to data from the city shared with Global News.

That number spiked to 15,526 in 2016 and fell back to around 11,000 in 2019.

Then, during the pandemic years, the number of registered drivers tumbled. As of Nov. 14, there were 6,630 taxi and limousine drivers registered in Toronto.

The number of Uber drivers has also been capped at its October 2023 level.

“A lot of that has to do with COVID,” Hubbard said of the lower number of taxi drivers registered in the city.

The future for both Uber and local taxis is likely to be made clearer toward the end of 2024 when city hall completes a report on how to reduce emissions from the ridesharing sector.

When the report is published, councillors will also decide how to proceed on the cap they placed on the number of Uber drivers in Toronto.

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