Uber and Lyft are pulling out of Austin, Texas, after people living in the area voted to reject a self-regulation proposal. The proposal would have allowed both companies to self-regulate drivers.
Now, voters want both companies to hire drivers only following strict background checks including fingerprint scanning and other background details. But that’s not all voters wanted.
Some Strange Details
The new law will require any company like Uber or Lyft to run thorough background checks on drivers, make sure that drivers have clearly marked cars with a company logo, and disallow the picking up or dropping off of passengers on certain streets. Uber and Lyft teamed up to fight this law, but despite spending millions to sway voters the law passed.
Since the new regulation would make it a lot harder for both companies to operate in Austin, both Uber and Lyft no longer operate in that city. The companies have both stated that there is no point in operating a ride sharing company in a city that does not allow true ride-sharing. Determining where a company can pick up and drop off is a bit extensive, and asking people to submit fingerprints for the sake of background checks violates driver privacy.
Is Self-Regulation Enough?
Both Uber and Lyft have protocols in place to determine whether or not a drive is safe. These companies both have stated that their own method of background checking is sufficient and thorough, and that drivers driving for both companies are safe. However, the residents of Austin did not feel the same way, clearly.
Austin is not the only city that is starting to feel differently about Uber and Lyft. A few places around the world are starting to make it a lot harder to ride-sharing companies to operate. Montreal, Canada, is one of those places. Uber is currently facing some battles in Montreal and around Quebec as well.
Why is Uber coming under so much fire all across the globe (and companies like Uber?). For starters, taxi cab companies tend to think that companies like Uber are unfair. In some parts of the world, cab drivers have to pay a lot of money in order to operate a taxi, and Uber drivers do not have to pay those same high fees. So when Uber comes to town and charges less, people will take Uber over taxi companies - some claim that this is unfair.
The other reason (the reason that is behind most of those voters in Austin, for example) is that some people don’t feel safe with random drivers. It might be the one reason why people don’t hitchhike anymore. Residents in Austin that voted against letting these two companies self-regulate made their case strong and loud - and now Austin is without ride-sharing companies.
So what does the future look like for ride-sharing companies? Right now, it’s actually looking kind of bleak. While Uber and Lyft were great companies at the start, they now have to spend a lot of those hard-earned dollars in court or just fighting general laws like the one above.