Uber: becoming “toxic”

“There are very few things that $5bn can’t buy,” said Laurie Penny in The Guardian, “but one of them is manners.” Last week, footage emerged of Uber’s billionaire CEO and founder Travis Kalanick shouting at an Uber driver who’d dared to complain that sharp reductions in fares were driving him into bankruptcy. “Some people don’t like to take responsibility for their own shit,” sneered Kalanick, slamming the car door. (The driver gave him a one-star rating, and posted the incident – recorded on his dashcam – online.) We expect our “robber barons” to be brash, but to swear at one of your own low-paid “partners”? This is a “new class of bastard”.

Kalanick was quick to issue a grovelling apology, said Timothy B. Lee on Vox.com – but PR disasters are piling up for the buccaneering entrepreneur (a man notorious for joking that his firm should be called Boober, as it helps him attract so many women). Last month, a former Uber engineer wrote a scathing blog about the firm’s sexist, bullying corporate culture (a verdict that was then publicly endorsed by two influential early Uber investors); and some 200,000 users deleted the app, after Uber broke a strike by cab drivers protesting against President Trump’s Muslim travel ban. Uber is accused of stealing self-driving technology from Google’s Waymo division, and is fighting numerous regulatory clampdowns. In short, it has a lot of problems, and it has got into “the bad habit of trying to paper over [them] with money”. It attracts, and keeps, staff by giving them potentially valuable stock options, but no opportunity to cash them in early. And it attracts customers (and so drivers) by setting artificially low fares: it’s been estimated that Uber customers pay less than half the cost of their trip; the firm subsidises the rest. The upshot is that Uber is losing astonishing sums – billions of dollars – every year, said Ed Conway in The Times, but investors keep funding it because they hope that, eventually, it will crack autonomous cars and clean up. Meanwhile, Uber’s strategy is to drive all its rivals out of business to create a huge monopoly. But can it achieve its goals in time, wondered Lee. The likes of Apple and Google – which work hard to generate loyalty from staff and customers – have core businesses that can subsidise their driverless car divisions indefinitely. Uber is becoming toxic; its users and workers are turning against it – and at some point, its investors may lose heart, too. The revolution Uber started will carry on, but it may not last to reap the benefits.