The Chicago market for Uber has exploded over the last few years, with as many as 40 percent of Chicagoans using the service en lieu of a personal vehicle. It’s simple, pull out your phone, hit the App Store or Google Play and enter Uber. Before you even type the “e” it’s sure to have popped up in the suggestions. Download it, enter your credit card information and presto! You’ve got a ride on it’s way at the tap of a button. Seems so easy. Almost too easy. No vehicle? No problem! Uber has partnered with leasing companies such as XChange leasing and rental companies such as Enterprise and Thryft Car. On the low end you will pay $140 weekly for a small sized sedan, say, a Dodge Dart or Chevrolet Cruze, and on the high end $217 for a midsized sedan such as a Chevrolet Malibu, Toyota Camry or Hyundai Sonata.
Uber get’s it’s partners from the general public; anyone with a vehicle is immediately eligible to apply providing that they have valid car insurance (even liability insurance,) vehicle registered in their name and a relatively clean driving record (no more than 3 minor traffic incidents in the past 3 years.) Background check? Yeah, there’s a background check, but it isn’t the most extensive. This is what concerns city officials whom prompted to impose a host of provisions and regulations that would severely bottleneck prospective partners, which conflicts with Uber’s business model.
Part of the attraction is the ease of access, the low barrier to entry. But the city seeks to have all current partners and prospective partners to take livery courses at one of the Chicago Community Colleges and obtain chauffer licenses which could cost as much as $500 per partner. Who would foot that bill, Uber or the partners? Also there will be a more stringent process of clearing an applicant for partnership including a more detailed background check and pulling their driver’s abstract from the DMV.
Some say this is the result of Uber founder Travis Kalanick simply not paying the right people. The taxi cab industry has a large lobbyist presence and the city has it’s money tied up in their business as well, so it is easy to see exactly why they put the squeeze on. Taxi cabs have helped the city move for decades, but what’s America without some of that old fashioned capitalism? While the taxi cabs were concerned with one another and not how to make the experience more enjoyable for the consumer, they fell behind in development and allowed something as simple as ordering a ride through an app to nearly bankrupt them. Well, that’s typically the fate of a monopoly right? Being too concerned with outdoing instead of improving because you have a product or service that’s integral to the function of an entire economy, leaves you subject to the genius of those subject to your antics.
A decision has yet to be reached regarding the fate of Uber. Uber has already pulled out of Austin and Houston Texas, Kansas and even China, one of their biggest markets, and they threaten to do the same in Chicago if governor Rahm Emanuel pushes for reform. Current partners say they don’t mind taking the classes and doing whatever it takes to remain active, but the reform would cause Uber to compromise too much of what separates it from leading competitors like Lyft. We will keep you updated as the fate of Uber-Chicago unfolds.
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