Thursday, February 26, 2015

Uber in Bucharest

I saw it all over the news yesterday: Uber launched its service in Bucharest. People are debating now if this is a good choice or not, so here is what information I found so far from a client's perspective.

Good points:
- Uber drivers are required to have a clean judiciary history and clean traffic violations history; cars should be newer than 10 years and insured; 
- from the application you can see the driver's photo, his rating and the registration number of the car;
- once you set your start point and the end point you get an estimated fee for the trip you plan to do;
- the payment is done automatically from your card and you don't ever tip the driver;
- you can rate the drivers, but the driver can rate you too, so behave :)

Questionable points:
- I would have liked Uber to ask also for the maintenance records of the car; you may have a newer car, but if you never check your brakes... This may be an issue in Romania where I still see many cars on the street which do not look well maintained; I think regular taxi drivers are required by law to check their car every 6 months, so even if they skip some tests the basic systems of the car should be in reasonable state;
- you have to put all your card details in the application (including CVV2 code) and they store in their database; this leaves you exposed in case their database is ever hacked; somebody mentioned that card companies say it is forbidden for a trader to store the CVV2 code of your card;
- I'm not sure what happens if you are stuck in traffic, do they have a waiting fee like regular taxis?
- can you change the route from the one computed by the application? for example if you know a less congested one;
- I understand Uber takes a cut from the fee (5%-20%); do they pay taxes in Romania for their profits? do the drivers pay taxes for the money they make? If the drivers have to file by themselves a form to the tax authorities to declare this income I'm sure nobody will ever pay taxes on the money they get;
- the minimum fee is 6 RON and if you cancel an order before getting into the car you will still pay the minimum fee;
 - for now the reported fees are slightly bigger then the ones of regular taxis, but the price may decrease as more drivers join the system; and supposedly you get a better service;

Two more issues you have to pay attention to: if there are big events like soccer games or rock concerts the fees will probably increase because Uber has an algoritm which automatically increases the fee if the demand is high in a particular area like in this case. Make sure you put the correct destination address; if you put another city by mistake you may end up with a $900 bill like in this case.

Overall I think the idea of the Uber service is good, but let's see how the execution looks like. I don't like that the number of taxi licenses are limited by the local authorities, this interferes with the free market for no good reason. But some regulation is needed in this area in order to make people feel safe when they take a ride in the city.

Update: I found out that they also have a waiting fee, similar to the one that taxis have;

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