Cosatu slams Uber's business model - TechCentral

Cosatu slams Uber’s business model


Uber is coming under increased pressure as trade union federation Cosatu is now taking aim at the Internet ride-sharing service.

Opposition to Uber has become evident among rival metered taxi drivers in Cape Town and Johannesburg amid claims that the Internet ride-sharing service is unfair competition.

Metered taxi drivers allege that Uber is not held to the same regulations as them.

Complicating the matter is that in Johannesburg Uber drivers are given chartered service licences while in Cape Town the internet service has to adhere to metered taxi licences.

Subsequently, metered taxi associations in Gauteng and the Western Cape have publicly expressed their opposition to Uber over the last week.

Now, Cosatu has hit out at Uber’s business model, which involves partnering with drivers. While not all Uber drivers own their cars, some of the Internet service’s drivers do have the option to own and drive their vehicle.

But Cosatu has particularly taken issue with regulation and wants Uber drivers to own the cars they drive as well.

“Cosatu opposes the attempts by Uber to try and take over the market by not complying with the required regulations. For Uber to want to enter the Cape Town market and undermine established business practices is unacceptable,” said Cosatu on Thursday evening.

“We will not allow a big company that owns the cars and denies the drivers the right to ownership to take over what was historically owner driver businesses. We want to stop these practices where white dominated companies have a monopoly over the industries.

“Cosatu demands that future taxi related industries be driver owned and that there is real empowerment through industries regulated by the state. Uber has a place in the industry in future, but not one where they own and control the cars and the drivers. The Western Cape must see real empowerment of the previously disadvantaged sectors of the society,” said Cosatu.

More than 200 Uber cars have been impounded in Cape Town this year because drivers of the internet service did not have the necessary metered taxi permits.

But on Thursday 145 Uber drivers were awarded metered taxi licences from Western Cape provincial authorities after a six month wait.

Uber has previously said that it is seeking a clear route to licensing for its service in the Western Cape. Premier of the Western Cape Helen Zille said in a newsletter this week that local and national government are considering e-hailing laws for internet ride-sharing services like Uber.

Demand for Uber has surged in South Africa with 2m rides being recorded this year so far, double that of 2014.

Uber also says it’s helping to create jobs in South Africa and that opposition to the service is a threat to this.

“Regulation in the Western Cape, aggressive intimidation and impoundments are threatening job creation and preventing our Uber partners from offering safe and reliable rides,” Uber said in a blog post last week.

Last week, Uber raised awareness over its permit problems in Cape Town by holding an online petition that notched up over 13 000 signatures of support for the service.  — Fin24


  1. CharlieTango on

    Obviously consumers were not happy with the existing taxi services – hence the success of Uber. Rather than trying to put some white owned capitalist spin on it, Cosatu should ensure that the non-Uber taxi services up their game to meet consumer expectations. Long live Uber!

  2. Cosatu is still stuck in 1970 and think that business is still done the same way. Get with technology and stop complaining, if its not the local people complaining that the foreigners are taking jobs then its Cosatu complaining about technology.

  3. Sir Arthur Streeb-Greebling on

    “We will not allow a big company that owns the cars and denies the drivers the right to ownership to take over what was historically owner driver businesses.” What?

    Then you as Cosatu must fully support Uber then. They don’t own any vehicles.
    Please pension off Patrick Craven he is beyond senile.

  4. Only way government or Cosatu to get their hands in the pie to get money. Just because Uber is working and it is efficient, now they have a problem with it. Maybe the government and other taxi’s need to think about how to improve their own services, and stop mingling into something working, plus delivering a proper service.

  5. Their idea of technology is still in the seventies, the underlying ideology is more than one century old and totally archaic.

  6. Wayne Gemmell on

    Agreed, they could at least investigate the business model before complaining.

  7. Pity they had raise the race card. There are some very real and valid opposition to Uber but that should focus on the important issues, like regulations.

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