Uber, the San Franscisco-based ride-hailing service powered by smartphone apps, has been banned from the entirety of Germany, having previously been blocked in Hamburg and Berlin for using 'unverified drivers in unlicensed vehicles'.
The decision comes following a challenge by the German taxi industry, which claimed its low-cost UberPop service, which links passengers to drivers who operate their own vehicles and aren't employed directly by the company, didn't comply with Germany's passenger transport laws.
Critics have highlighted the disparity between the cost burden of the regulation that must be met by licensed operators, and the low-cost model of Uber which, they say, provides unfair competition. They've also raised concerns about the safety of passengers, and drivers potentially driving without the necessary insurance. Uber counters that its company insurance covers all of that.
At least that's the polite way of describing the situation. Dieter Schlenker, chairman of Taxi Deutschland, a co-operative operating in the industry, was bit more road-ragey – describing the sharing economy model employed by Uber as a 'locust' that was harmful 'to the state, society and employees alike'. He added that you had to respect the law, 'no matter how neoliberal the company'.
That may seem a strange criticism of a start-up, until you learn that Uber is backed by Goldman Sachs and Google. Indeed, what may look like a humble start-up has a valuation of $17bn – which gives it a seat at the front of the tech bus, right next to Facebook. It’s now operating in 128 cities and 37 countries around the world, according to its blog.
Uber cites Germany as one of its fastest-growing markets in Europe. But what may have been bad news for the company may turn out to be nothing more than an unfortunate bug waiting to be wiped from its windscreen. Uber founder Travis Kalanick has opted for the road of defiance and just carried on driving anyway, arguing that a ban isn't enforceable while the appeal process was happening.
"You cannot put the brakes on progress," said an Uber spokesman, adding that Uber will continue to offer UberPop ridesharing services via its app throughout Germany. Up against most businesses, the law would have responded to that kind of talk with a big red traffic light.
But when Goldman Sachs and Google are in the back seat, the rules of the road may prove somewhat different.