
Uber’s No-Holds-Barred Expansion Strategy Fizzles in Germany - jhonovich
http://www.nytimes.com/2016/01/04/technology/ubers-no-holds-barred-expansion-strategy-fizzles-in-germany.html
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sjm
There are a lot of reasons why Uber doesn't really work in Germany, most of
them listed here already. One I'd like to add is, at least from my experience
in Berlin, taxis here are already what you'd get by paying the premium for
"Uber Black" — Mercedes E-Class, super clean, super comfortable, driven by
professionals and not very expensive. This is a world of difference from, say,
Australia, where the taxis are dirty, unsafe, and driven by a workforce that
has a big stimulant drug-use problem (of course this is a generalisation, but
I've caught enough taxis in Australia to come across all of this a few times,
and it's certainly not uncommon).

In other words, there are places like Australia that desperately need Uber and
the competition it brings to taxi companies. Germany doesn't have this need,
and Uber doesn't bring much to the table compared to what is already
available.

~~~
socialist_coder
"not very expensive"? - they are the same price as taxis in the US. I think
most people would consider them expensive.

Personally, I would love to pay a cheaper price for a less comfortable trip. I
don't need to ride in a freshly washed 2012 Mercedes E-class.

~~~
rbehrends
Driving a taxi in Germany is pretty much a minimum wage job (or close).
There's not much room for cutting costs.

The Mercedes E-Class aspect is a bit misleading; Mercedes offers cars to
German taxi companies at a pretty hefty discount (as long as they are used as
taxis for at least one year), which is why they're so popular.

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yolandakm
Taxis in Germany are just different. From someone who has lived in both SF and
Berlin recently, here is the summary:

Berlin: almost all taxis are Mercedes E-Class. super clean, drivers are very
friendly, interesting to talk to, seem educated. they drive calmly and
professionally. the experience makes you feel good and I always tip
generously.

SF: taxis are nasty. I don't want to touch anything inside the car, the seats
are covered in plastic "puke" covers, the seat belts are hard to use, the
driver claims he does not take credit cards even though he has a credit card
machine. he might refuse to take you to certain areas, just cause. sometimes
the drivers themselves are dirty, they smell like they haven't showered in a
week, they are eating while driving. the car smells like pot or cigarette
smoke. I feel bad for the drivers, they look like they are just barely getting
by, and they are often angry and drive extremely aggressively. I guess when
you are just scraping by financially as a taxi driver in SF, every second
counts. I'm always surprised we didn't get into an accident.

~~~
mpeg
That's just Berlin, not Germany.

In smaller cities, you'll wish you had Uber. Most taxis speak little english
(hard to communicate where you're going without just handing them your phone
with the address in it), they don't always take card or like doing so (I had a
guy who after mumbling something nasty used a manual imprinter on my card) and
have generally given me bad service.

Never had those issues with Uber when it was available in more places. I've
moved to using Blacklane whenever I can, but they're worse than Uber.

~~~
mschuster91
> they don't always take card or like doing s

Don't blame the taxi drivers, it's widely known that Germans don't like cash-
less payments, and much less credit cards. Partially because of surveillance
and partially because unlike the US, you have to have excellent credit reports
to get a true CC and not prepaid/debit CCs.

~~~
kuschku
And because CCs add often up to 5% to the cost, but you can’t make the price
for customers with CC higher.

~~~
DasIch
Actually you can. In Berlin it costs 1.50€, if you're paying without using
cash so using a CC, EC or something like that.

~~~
kuschku
Oh, interesting. Because VISA and MasterCard prohibit doing that with CCs. The
CC price has to be the cash price, or you can’t take CCs.

~~~
dogma1138
That's dependent on the country and it's no longer the case in the US either.
[http://www.cardfellow.com/charging-customers-a-credit-
card-c...](http://www.cardfellow.com/charging-customers-a-credit-card-
convenience-fee-at-check-out/)

------
Tomte
You can make as much fun as you want about Germans not setting foot on the
lawn because it's verboten, but law (and order) is really a thing here.

When a company openly breaks the law (and is even smug enough to brag about
it), most of the people take a strong dislike to it.

Intentionally breaking the law, in order to quickly get too big too punish
seems to work in the US sometimes, because "evil government". In Europe you're
in for a lot of trouble, because "evil corporation".

------
Mithaldu
The main reason Uber is flopping hard in Germany:

[http://www.taxi.eu/en/](http://www.taxi.eu/en/)

It's been around since ca. 2011 and for the passenger side offers the same
ease-of-use as Uber does, but results in rides with real taxis along with all
the protections, insurances and guarantees they involve.

For no extra cost.

~~~
viscanti
Actually it seems like black car regulations designed for protecting taxi.
There's a law there that requires a driver to drive back to their "base"
before picking up again. That means the Uber drivers often need to spend an
extra hour of driving for each trip, where taxis don't. Regulations like that
don't do anything for safety, they exist only to protect an entrenched
industry. They aren't being beaten by competition, they're being beaten by
suspect regulation.

~~~
detaro
That's why Uber later tried to hire regular Taxi drivers.

And yes, the regulations exist to protect the taxis from competition, but in
turn taxis have rules they have to follow. E.g. they are not allowed to turn
you down if they don't like where you are going, because they are considered
part of the local transport infrastructure that has to be available. Since
they have to take "bad" jobs, they get some protection from others taking only
the profitable ones.

~~~
Mithaldu
That is very interesting to know, especially since i always ask taxi drivers
if they're ok with taking me where i want to go. Aside from a simple "yes",
the only other answer i've gotten so far was "i don't care, thanks to the
phone apps i can get rides anywhere and will likely be able to get a passenger
for at least part of the way back".

------
Tomte
Another thing I'd like to point out: "The company has argued it can add
thousands of new jobs to Germany if it is allowed to operate freely"

Since the social net is still pretty strong, there is maybe less pressure to
add jobs no matter the cost.

And we as a society need to talk about which jobs are even worth existing. I'm
not saying that Uber driver is necessarily a bad job, but "because jobs" is
only one important part of the argument. The other parts are "what kind of
job?", "what wages?", "what kinds of externalities?", sometimes even human
dignity.

~~~
DasIch
I'd also question how Uber defines job here. Something tells me those
thousands of jobs they're thinking of might not be full-time jobs providing a
wage you can live on.

~~~
kuschku
Even more interestingly: Has someone sued Uber regarding the
_Scheinselbstständigkeit_ of their jobs yet?

~~~
_ak
I don't know how current this information is, but the few times I used Uber, I
got regular taxis. That was in Berlin a few months ago. So at least during
that time, Uber was yet another taxi app, with no USP at all.

------
soyiuz
I've said it elsewhere, but I'll say it again: Uber's endgame is not in the
disruption of the taxi industry. They are really a logistics company. Once the
regulations catch up with them, they will be providing a logistics service for
taxis (and possibly for trucking and deliveries). They are disrupting the
antiquated software / infrastructure involved in the dispatching and
operations of taxis. The initial competition with taxis is a temporary way of
forcing them to adopt the new software / infrastructure.

In Germany the logistics of taxi management are already far beyond what we see
in the US. The value proposition is lower for both rider and driver. It would
be interesting to learn about the companies involved in that market. (Who
makes the dispatching radios, software vendors, profit margins, etc.)

~~~
oniMaker
Uber's endgame is to roll out globally with an attractive platform for users
and an enticing offer for drivers, gain a dominant market share in as many
markets as possible, then steadily replace all human drivers with self-driving
cars. This will happen over the next several decades.

At that point, the company will maintain service centers for their fleets,
whose maintenance costs will be low enough to significantly increase their
profit margins. Those larger profits will, of course, flow to the relatively
small number of shareholders instead of being distributed among a larger human
workforce, as they are currently.

Listen to Peter Thiel. The endgame for superlative companies is monopoly.

~~~
kuschku
And in Germany, where some of the largest Taxi dispatch services are already
owned by the car manufacturers (Mercedes has a majority share in MyTaxi, for
example), this is also possible – and without Uber ever being able to compete,
as they can never be as cheap as a car manufacturer doing everything, from
every bolt and screw to the taxi in-house.

------
Derbasti
Just a remark on credit cards in Europe: yes, they are less common than in the
US. However, this is mostly because Europeans use "EC cards" instead, which
mostly work like debit cards except that they are issued by the banks
themselves without an intermediary like Visa or Mastercard.

~~~
halomru
From my experience most Germans don't own a credit card. Everybody owns a EC
card (since it's your normal bank card) but most people only use them if
circumstances prevented them from carrying sufficient cash (unplanned big
purchase etc).

Card use is on the rise, but it's far from the norm

------
DasIch
The only thing Uber has a problem with is encouraging people to play taxi with
their private car using private insurance. That's not allowed for very good
reason, the other services they offer work fine.

The taxi market is heavily but well regulated. As a consumer Uber offers no
improvement apart from potentially temporarily lower prices in the short term.

------
cabinpark
It doesn't surprise me in the least. Germany is a country of insane
regulations and rules. They absolutely love paperwork - all the Germans
apologized to me when I first moved here and set everything up - and have a
very strict way of operating. The American way of doing things, as the article
briefly mentions, is very different. I'm not saying it is better or worse,
just different. This is a cultural thing that doesn't magically change
overnight. I know I still get annoyed at how different things are sometimes
compared with back in North America, but that is the way things operate here
and you have to learn to play the game otherwise you will lose.

The credit card thing is also true too. Cash is king here and I routinely see
people with hundreds of Euros of cash like it is nothing. I always see people
paying for groceries with 100 Euro notes. Furthermore, I know Germans are much
more concerned with personal security and privacy that there is also going to
be a push back about having to share personal information with an American
company.

Also I live in Frankfurt, and, to be honest, I have no idea why people even
use taxis. To get from the Hauptbahnhof to practically anywhere in the city is
only a < 20 minute U-Bahn ride. Also, the public transportation in Europe
tends to be insanely good and efficient so a ride-sharing app will also have
to compete with this as well.

~~~
sandworm101
Really? I've helped a couple european companies setup US operations and they
all complain about the over-regulated and bureaucratic approach in the US.
They find tax and immigration paperwork, and I mean literal PAPERwork, very
unsettling.

~~~
rbehrends
It depends. There's a ton less bureaucracy involved with a blue card in
Germany compared to an H1B visa in the US; on the other hand, the requirements
for (say) a fishing license in Germany are borderline ridiculous [1].

[1] [http://fishinggermany.jimdo.com/taking-my-german-fishing-
lic...](http://fishinggermany.jimdo.com/taking-my-german-fishing-license/)

~~~
sandworm101
That actually doesn't see that bad. It's effort, but at least it is
predictable and clearly laid out ... very German imho. In the US things are
generally more opaque, requiring experts (lawyers, even lobbyists) to explain
how various agencies actually operate. Without that advice, most of the
paperwork is either incorrect, unnecessary, or won't ever allow your issue to
progress.

Try looking up the procedures for an EB-5 visa application. They don't mention
that, since the prez made certain statements re deportations, the immigration
people are going nuts. Each and every step is being examined as if your client
was trying to export uranium.

