Uber Banned Again

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It is obvious that those who think that Uber Technologies Inc. is a great investment or a good business opportunity are not paying attention to the news. The ride-sharing service has decided to pull out of a major American metropolitan center because of a few common sense regulations.

Uber is shutting down its operations in Kansas City, Mo. because of a new city ordinance that puts a few requirements on ride-sharing companies it finds too onerous, The Associated Press reported. What’s truly astounding here is the list of requirements that Uber found too restrictive.

The requirements Uber apparently finds too difficult and expensive to comply with include:

  • Uber drivers would be required to have adequate insurance coverage just like cab drivers do.

KC

  • Uber drivers would have to undergo a thorough criminal background check.

 

  • Drivers would have to pay a $250 fee to operate in Kansas City.

 

  • The fee for Uber drivers would drop to $100 if Uber paid the city $40,000 a year. Apparently, a company that is supposedly worth $41 billion cannot afford $40,000 a year to operate in one city. One would think Uber would gladly fork over that amount, but it is not.

 

  • Uber drivers would have to undergo a medical check to operate in Kansas City, much like commercial truck and bus drivers do.

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  • Uber drivers would have to get a business license, a reasonable requirement since they are independent businesspeople.

 

  • Uber drivers would have to get a chauffer’s license like cab drivers do.

 

Nothing here seems very unreasonable or that costly, yet Uber balks at it. One has to wonder how viable a business Uber is if it cannot even meet these requirements and make money. Uber has also ceased operations in Eugene, Oregon, Boise, Anchorage, and San Antonio because of similar requirements, according to the AP.



Uber is apparently trying to get back into Portland, Ore. through a deal with the city council that has apparently fallen through, Geek Wire reported. The city of Portland sued Uber after it caught ride-sharing drivers operating in the city without licenses in December. Uber and the council are trying to negotiate a compromise to end the legal battle that keeps falling through.

We need to ask ourselves what sort of future companies like Uber have. If they cannot comply with a few basic regulations and make money, then their business model is not viable. Perhaps it is time we scrapped this ridesharing concept or took it back to the drawing board.

By the way, Geek Wire seems to have come up with a new name for ride-sharing services. It is now labeling them Transportation Network Companies. That’s a better term than ride-sharing, but hardly accurate. A more descriptive phrase might be car hire apps or car hire companies, which is what Uber really is.

One more thought. I would like to ask those investing in Uber and Lyft a simple question: How is a company that cannot comply with a few basic regulations a viable investment or a credible investment?

The sorry truth is that Uber is fast becoming a bad joke. I have to wonder what the people investing in it are smoking.