Uber CEO: Seattle regulations would make our service ‘unusable’

Uber CEO Travis Kalanick

Uber CEO Travis Kalanick

Uber CEO Travis Kalanick is not pleased with the Seattle City Council’s current moves toward regulating Uber and other ride-sharing companies.

On a conference call about his company’s decision to expand its insurance coverage, Kalanick was asked about how UberX would operate in Seattle if the City Council votes this Monday to limit the number of drivers the company could have on the road at any given time.

“I think the short answer is that the rules are designed to incapacitate Uber and make it unusable,” Kalanick said.

Kalanick said that the proposed regulatory system Seattle City Councilmembers voted on last month would make Uber work more like the city’s taxi system, with the company being unable to meet demand from many of its users. He went on to say that the changes would also be detrimental to the company’s drivers, and that the Council would be responsible for more people being on the “welfare line.”

While Uber, Lyft and Sidecar have all provided the total number of drivers that are on their platforms in the city, none of them have told the City Council how many active drivers they typically have online. When asked if his company would be willing to share its data with the City Council in the interest of making a compromise, Kalanick was adamantly opposed to the idea. He said that the caps were not beneficial for either Seattle citizens or drivers, only the city’s taxi companies.

When discussing city politicians, he said that opposition to Uber and other companies like Lyft and Sidecar often comes from city leaders who have been taking campaign contributions from the taxi industry.

UberX supporters wave posters during last week's City Council meeting.

UberX supporters wave posters during last week’s City Council meeting.

“And guess what, those folks usually end up being the people who end up running the Transportation Committee,” Kalanick said.

It seemed like a veiled stab at Seattle City Council President Sally Clark, who leads the council’s Committee on Taxi, For-hire, and Limousine Regulations, and has been a proponent of placing caps on UberX, Lyft and Sidecar.

When it comes to the upcoming vote in Seattle, Kalanick said that the company is focused on getting UberX drivers and passengers to speak up about the positive experiences they’ve had with the service to encourage the city to avoid imposing caps.

One ace in the hole that Kalanick may play. You may recall that Amazon.com founder Jeff Bezos — who just happens to be building a big company in downtown Seattle — is an investor in Uber.

Previously on GeekWireDriving politicians crazy: A breakdown of ride-sharing controversies, city-by-city

  • elbowman

    I think the problem is if you can’t compete on an equal playing field then it’s time to quit attempting to cut circumvent the laws for your industry and review your business plan. Otherwise, get out of the business. It’s untenable for you.

    Don’t blame the duly elected representatives for enforcing the rules in place for your poor planning and inability to compete.

    • Slaggggg

      Thanks for taking a break from driving your smelly dirty taxi around to post … the only people complaining about Uber are the taxi drivers. Everyone else loves it. Wake up and compete.

      • elbowman

        You know what happens when you assume!

      • Out For Justice

        Slaggggg, you must be the same sort of kid that wanted to change the rules because you could not compete…

      • Derrick

        Nice classist and presumptuous post. Way to stay classy.

    • Guest Guy

      Give it a rest. As Slaggggg said, the pubic i.e. customers, LOVE Uber. They don’t love taxis. A taxi used to be something you took because there wasn’t another readily available option. Taxi drivers treated their customers that was too.
      Now you have competition. Boo F’ing Hoo. Even if the very, very LAME city council ends up interfering with Uber, it is short term, eventually they’ll prevail. And I’m sure you know that.
      Btw, 4-5 of the last Uber cars I’ve taken were driven by ex-cab drivers. Guess what? a, they didn’t get on their phones once, b, they showered, and c, they loved driving for Uber.
      Finally, I’d guess that many of us that use Uber aren’t using it so much instead of a cab but rather when it is more convenient than driving our own cars, hence the name ride sharing. That’s better for the economy and it puts money in the workforce but suddenly the azzholes that are our politicians don’t seem to care about that.

      • elbowman

        No, rest for the weary. Tired of hearing these complaints from folks who are working for Uber, Lyft, Sidecar, etc. Wanna play the game? Follow the rules.

        Not everyone dislikes cabs. Recent studies in cities that have cabs and ‘ride share’ companies show cabs compete rather well. They’re quicker to pick up their fares, and they charge competitively, and they carry the proper insurance to protect their clients and the public.

        If you can’t, or won’t, willingly protect your clients and are unable to meet or beat the going fares and be profitable, get out of the business. You’re a loser.

        • Guest Guy

          Ha Ha Ha, nice try. I run a software company; I’ve never driven a cab or an Uber car. But.. I’ve been a customer of both so please, maybe listen to what I’m saying because I don’t take cabs anymore. Ever.

          • elbowman

            Good for you! Then you must know about business, and laws, and taxes, and licenses, etc. I’ve never driven a cab either. If a business wants to compete they have to follow the same rules as others in their industry. Uber, et al, is not a software company. They’re a taxi service. They have to follow the rules other taxi services follow.

          • Seattle Cabs suck

            I’m a customer of Uber/Lyft and hell yes they are better than Seattle cabs. I can’t think of the number of times I’ve sat waiting for a yellow or orange cab to show up. 30 minutes and multiple phone calls later – no cab. These new services are amazing. If this were NY or Chicago, yes, cabs have a case…. but Seattle??! Give me a break.

    • No Taxi for Me

      Can’t compete? You are delusional. I’ve never spoken to anyone who didn’t love Uber and their competitors services. I also can’t think of anyone who would tell you they love taking a cab. Get real.

      Seinfeld summed it up perfectly- http://www.youtube.com/watch?v=MtbdctQIqYw

      • elbowman

        Yes, can’t compete. People liking your service doesn’t mean you’re competitive in your market. Buy the same licenses, pay the same insurance rates, compete on a level playing field. This article is about Uber’s Pres saying, ““I think the short answer is that the rules are designed to incapacitate Uber and make it unusable,” Kalanick said.” What he really means is don’t make me follow the same rules as my competitors, because I’ll lose. The rules are designed to protect the companies, drivers, and the general public based on past performance in this industry. Taxi service isn’t new. We have experience with the problems that arise with it. That’s why there are fees, insurance, and rules.

        • Cally Slark

          People i.e. CUSTOMERS liking your service is a great place to start. Taxi clowns having had a government mandated monopoly, have totally underserved the market, and in general, operate substandard businesses. Now someone has come along and broken your eggs. Boo Hoo.
          What Uber and others have shown is that that was a greatly underserved opportunity- which the taxi companies, completed focused on maintaining a monopoly and holding on to absurd medallions, didn’t address.
          So Uber will probably have to buy insurance. Big Deal. Their service is better, they’re better funded, and in the long run they’ll win. And hopefully this is the last office that Sally Clark will ever hold.
          My advice is to get on the Uber/Lyft/whatever train while you can because it is leaving the station and while you might be able to hold them off now, sooner or later (probably sooner), they are going to subsume you and there’s nothing you can do about it. Sure you can hire a “tech person” to write an app, you probably already have one, but it isn’t in your DNA to compete like this and history has proven that when it isn’t in your DNA you don’t adapt.
          Good luck, you’re going to need it.

          • ClaimsAdjuster

            “So Uber will probably have to buy insurance. Big Deal.”

            So why haven’t they done it yet?

      • ClaimsAdjuster

        Funny that you should bring up Seinfeld. After getting charged $415 by Uber for driving their kids a few miles during a snowstorm, the Seinfelds are saying “never again” to Uber.

        http://www.businessinsider.com/jerry-seinfelds-wife-spent-415-during-ubers-surge-pricing-2013-12

  • Just Aguy

    This guy is an #UberDoucheBag! The insurance announcements he made are another #UberFraud! The drivers policy is still the PRIMARY and thus NULL and VOID for engaging in livery for hire activity! Either make the UberX’s policies the PRIMARY or make the drivers get commercial livery insurance. That is the only way out of this #UberFraud charade!

    • Slaggggg

      Hey thanks for taking a break from driving your smelly dirty taxi around to post … the only people complaining about Uber are the taxi drivers. Everyone else loves it. Wake up and compete.

      • elbowman

        Copy and pasting your assumption, now?

  • NewAgeMeMe

    Isn’t the coal industry saying the same thing? Welcome to a civilized society, prick!

  • Blah

    Requiring insurance coverage is a sensible, reasonable regulation for a business carrying customers for a fare. No different than requiring me to have insurance when I drive my car for personal use, requiring general contractors have a bond of a certain dollar amount on file with the state, etc. You can haggle over the specifics of the insurance, but insurance requirements are pretty common.

    UberX drivers in particular likely have no coverage while en route to pick up a fare because their insurance policies are personal, not commercial, and picking up a customer is a clear commercial use that voids most personal insurance policies. This is why auto coverage is a part of any business insurance package with costs that vary depending on the amount of driving the business does–a law firm pays less for auto than a pizza delivery service generally.

    I don’t understand the caps and the value of the caps though. It seems impossible to administer them or track them across multiple companies. It is trying to restrict competition and that is unfortunate. Hopefully Uber and the others can get to a reasonable point.

  • ClaimsAdjuster

    Uber has been saying for months that the Seattle City Council’s proposed regulations are soo bad, that they will take their ball and go home. But last week before the scheduled City Council meeting, Uber and Lyft finally coughed up their driver figures. Now this week before the City Council meeting next Monday, Uber and Lyft suddenly expand their insurance coverage.

    The message is that in reality Uber wants to stay in Seattle and all this talk about how they are being crushed is just more of their corporate hype.

    Now what the City Council has to do is squeeze more money out of Lyft and UberX. Their license fee is only $50K annually. A taxi fleet of 100 would bring in $65K . Uber says it has more than 300 vehicles in its fleet. That means that Uber should be paying $195K. Otherwise the city is giving Uber special treatment.

    • Guest

      I disagree, obviously. Because Uber pays less, they charge me less. I like lower prices. Don’t you?

      • ClaimsAdjuster

        As a taxpayer, I don’t want to pay for Uber’s use of the streets nor do I want to pay for the medical treatment of the victims of their accidents including their drivers. As a car owner, I don’t want to pay higher auto insurance rates for UberX’s accidents.

        Since I don’t use Uber, their lower prices does not effect me but their freeloading on taxes and insurance sure does.

        • Joe Technocrat

          You shouldn’t own a car, Karen. Owning a car makes little economic sense. Why have you chosen to spend so much money on gas, maintenance, insurance, and depreciation? Your self-professed frugality seems out of place here.

          Please divest yourself of your car, Karen. Alternatively, you might be able to make some money by signing up as a driver for UberX, Lyft, or another TNC.

          • ClaimsAdjuster

            Joe: “…you might be able to make some money by signing up as a driver for UberX, Lyft, or another TNC.”

            According to Consumer Reports, that would be a foolish investment:

            But meanwhile, TNC drivers risk losing a bundle on their road to taxicab riches (not that we’ve ever met any millionaire cab drivers): That million-dollar excess liability insurance covers passengers, pedestrians, other cars, and property, but it doesn’t cover injuries suffered by the driver or damage to his or her car-cum-cab if there’s an accident.

          • Joe Technocrat

            Karen, you have health insurance from your job as a claims adjuster, right? (Just kidding — you’re not actually a claims adjuster. You’re just lying to try and sound informed about insurance.)
            I’d like to reiterate my recommendation that you join these services before you bash them. The Consumer Reports hit piece, while satisfying to your ideological mindset, is not actually true. The million-dollar liability insurance covers everything that an UberX driver could do, including whatever “car-cub-cam” means.

          • ClaimsAdjuster

            A-Hole: “The Consumer Reports hit piece, while satisfying to your ideological mindset, is not actually true. The million-dollar liability insurance covers everything that an UberX driver could do…”

            And why should we believe you, A-Hole? You haven’t backed up anything you said, You are just an A-Hole making assertions.

        • Guest

          (Holds out left hand)

          So there are services that benefit thousands of people every day by offering low-cost rides without the burden of car ownership.

          (Holds out right hand)

          You’re worried about your insurance rates going up because you have to pay for other people’s costs. (If you were an insurance claims adjuster, you would know that this is how insurance works.)

          (Holds out left hand)

          Thousands of riders.

          (Holds out right hand)

          One driver.

          (Left)

          Thousands.

          (Right)

          One.

          Who would you choose to benefit? Many thousands, or yourself?

          I know I speak for the thousands. To speak for oneself is folly.

          • ClaimsAdjuster

            Joe: “You’re worried about your insurance rates going up because you have to pay for other people’s costs.”

            More sophistry. No, not generic “other people” but these faux taxis which are in a higher risk class than private automobiles. I don’t want to pay for the higher risk of logging trucks or race cars either.

            If you knew anything about insurance, you would understand that premiums are set according to specific risk classes.

          • Joe Technocrat

            Karen, for a person who falsely claims to be a “claims adjuster,” you really need to understand how insurance works.
            You have no proof whatsoever that UberX will affect your insurance rates. Your rates haven’t gone up by one penny, nor will they. If you have any proof whatsoever, please post it in this thread. Otherwise, I must conclude that you are simply frightened, misinformed, or unintelligent.
            Thank you again, Karen.

          • ClaimsAdjuster

            For the purposes of discussion, I will call you “A-Hole”.

            A-Hole: “You have no proof whatsoever that UberX will affect your insurance rates….Otherwise, I must conclude that you are simply frightened, misinformed, or unintelligent.”

            In Colorado, Uber’s bought and paid for politicians have introduced legislation to force auto insurers to cover UberX under non-commercial policies. The insurance industry objected exactly on the grounds I have raised.

            This is what the Colorado Insurance Commisioner and the PUC Director wrote in a memo attached to the bill:

            “The insurance industry is not in the business of accepting additional risk for no additional premium.
            Since in many cases the insurer will not know which of their customers will be using their vehicle to drive for a TNC, they will be forced to pass this cost on to all of their customers.”

            Thanks again, A-Hole.

        • DaveINLA

          More UberX available. Less potential Drunk Driving. Lower potential incidents.

          Cap number of Per to Per / Rideshare/ Fill in the Blank Alternative Transportation Services and more potential Impaired Drivers ON the streets.

          Which scenario would reduce the number of Accidents on the streets of Seattle or any City? A Per to Per / Rideshare Driver or a Drunk Driver? As a Taxpayer, I would think that the more options available for the Consumer who wants a bottle of wine with dinner, or a few drinks on a Fri/Sat night, the fewer accidents in your city. But then again, having this choice for your City might not be important to you….as a taxpayer.

          I find more young adults going out in groups and using UberX instead of having one in the group “only” have 2 drinks…or so. I find couples going out to dinner and using UberX so they can all drink a bottle or two of wine and get home safely.

          For my city, I want as many convenient accessible alternatives to my kids, my friends, and my family to NOT drink and drive. My son just moved out of the house and uses Lyft and UberX on weekends with his buddies. Works for me. Does he use Taxis, not so much but AFTER using Lyft/UberX, he does occasionally. But Per to Per Transportation actually got him in the habit.

          I’m not telling Seattle Citizen’s what to do. But using Accidents as a reason to limit Per to Per Transportation Services isn’t a good argument.

          • ClaimsAdjuster

            Three young ladies tried to get Uber on New Year’s eve to go from downtown Seattle to Shoreline. Uber quoted $125 because there surge pricing was in effect.

            Is that how you get drunks off the road? Maybe you mean just rich drunks.

            A For Hire vehicle took them home for $50.

          • DaveINLA

            Where my son lives, they do not limit the number of Uber/Lyft/Sidecar Drivers. He can get when any time he wants. Last time I checked New Year’s comes around once per year. He isn’t rich, he waits for the Surge Pricing to go off. Then he goes home. Not too difficult. Like most consumers, he likes choices. I’m happy that the “3 young ladies” took a For Hire for $50. They had a choice and made it. I don’t get the argument.

          • ClaimsAdjuster

            The Seattle City Council and the mayor are all in agreement that they don’t want what happened in San Francisco on New Year’s eve to happen here. Your bogus claims about getting drunks off the road, as if UberX and Lyft are the only services doing that, are not very good arguments for allowing uninsured cars on the road.

          • DaveINLA

            I did not say this. I said that my son was not in the habit of taking alternative transportation. Because of Per to Per Transportation, he now is. I see this as a trend with other young adults where I live. Taxi service did not creative the cultural change, Per to Per Apps like UberX/Lyft/Sidecar have. More alternative transportation be it Taxis or other types that consumers can choose from the better. You throw around Bogus like you’ve done research. Guessing you haven’t.

  • Joe Technocrat

    Hi, Travis. I’m a technocrat. I believe that technology can liberate us in ways that our traditional governments cannot. I’ll be running Seattle in a few years once I and my partymates are elected into office.

    Travis, you should know that we technocrats strongly approve of Uber and its competitors. The barriers about which you complain were implemented by men who will cease to hold political power soon. As a result, please continue to invest in Uber expansion in our city. Those who claim to oppose you hold no long-term power.

    Thank you again, Travis, for making our city better. We technocrats welcome you with open arms.

    • ClaimsAdjuster

      Technology has nothing to do with this. Taxi/For Hire companies are using the same type of app – such as Flywheel. This is about UberX’s unlicensed, uninsured taxis that he is pretending are not cabs.

      • Joe Technocrat

        Hi, Karen. (For purposes of this discussion, we’ll assume your name is Karen.)

        I’m a technocrat. As a technocrat, I will be governing you in a few years. Consider what you mean when you say “unlicensed” and “uninsured.”

        Now that you’ve had time to think, let me educate you on the way things will work.

        “Unlicensed” presumes that one needs a license to drive a car for hire. Once one has passed a driving test, he or she will be able to drive a car for any purpose. Whether he or she is remunerated for his or her driving is immaterial, Karen. UberX is no more in need of commercial licensing than you are, Karen, when your friends chip in to buy gas for our long road trip. Therefore, “unlicensed” is not a concern.

        “Uninsured” presumes that the drivers carry no insurance. Again, this is not true. Uber provides commercial insurance well above what you or I have for our personal vehicles. We have educated you numerous times about this, Karen, but despite your self-professed title as a “Claims Adjuster” (without providing the name of your company, thus making your title dubious) you have willingly ignored this information. Again, as a technocrat we have evaluated this information intelligently and found that UberX has not infringed upon any violations that would merit legal action.

        As a technocrat, Karen, I thank you for putting our city in my capable hands. I will think about how things should work in the future — there’s no point in fussing about making UberXs as expensive and as poor as taxis are today.

        • ClaimsAdjuster

          I don’t know who Karen is but you have not educated her on anything other than the use of sophist arguments.

          Joe: “”Uninsured” presumes that the drivers carry no insurance.”

          No, “uninsured” refers to relevant insurance. Invalid non-commercial policies that won’t pay out in an accident because of a livery exclusion clause is as relevant to a driver’s UberX taxi business as his dental insurance.

          Likewise, “unlicensed” refers to the business, taxi and driver’s for hire licenses which the under-the-table UberX driver do not have.

          Joe “Once one has passed a driving test, he or she will be able to drive a car for any purpose. Whether he or she is remunerated for his or her driving is immaterial…”

          Fortunately, it is the state legislature and city councils that make that determination, not you. This is what the law says:

          RCW 46.72.010

          “The term “for hire vehicle” includes all vehicles used for the transportation of passengers for compensation…”

          “No for hire operator shall cause operation of a for hire vehicle upon any highway of this state without first obtaining a permit from the director of licensing, except for those for hire operators regulated by cities or counties in accordance with chapter 81.72 RCW. ”

          • Joe Technocrat

            Karen, those laws you’ve cited are as outdated as your “Claims Adjuster” business cards are. As a technocrat, I will be rewriting them. Until I am installed, I urge Travis Kalanick to do what is best for me, the UberX customer, and not what is best for the fake-claims-adjuster nay-sayers who quote obsolete laws as if they were still valid or meaningful.

          • ClaimsAdjuster

            For purposes of this discussion, I will assume your name is “A Hole.” Fortunately for us, A Hole, it is not up to you or Travis Kalanick to decide what laws are valid.

          • I Hate Insurance Companies

            You are ridiculous. Face it: the taxi model is outdated and doesn’t serve a huge audience of people, not to mention the bad service, stinky cabs, etc.
            Uber should have to have the same insurance as a taxi, I’m fine with that. The idea though that Uber cars are unsafe is laughable. Over 1/2 of their drivers are former cab drivers. Yes, there was a tragic accident, but I’m sure there are plenty of taxi accidents too, there is always the risk when driving, whether professionally or not.
            In the end Uber and the other similar services fill a void that the stupid and outmoded taxi model wasn’t/isn’t filling. Stop trying to make this out to be more than it is. Your product is old and stale and fixates on the ridiculous “medallion” model. It is over.

          • ClaimsAdjuster

            You are an ignoramus. Uber cars are unsafe because they are uninsured and the drivers are distracted by their smart phones.

            Seattle does not have a medallion system. That is only in a few big cities like New York.

  • Zaxkenstein

    Ugh… The pro UberX fanboys are just making that culture look awful. They’ve all decided they WANT THEIR RIDE “NOW! NOW! NOW!” And they’ll fight and pout no matter how corrupt and devoid of any fault they claim to be. Go away selfish people.

  • Joe Technocrat

    Karen, thank you for being a great interlocutor. Unfortunately, unlike you I have to work during the week. I look forward to educating you some more on Saturday and Sunday!

    • ClaimsAdjuster

      So you drive your uninsured cab Monday through Friday? Don’t get in any accidents, your insurance company will cancel your policy. Then Uber will fire you.