Uber is coming . . .

2016-03-02 06:00
Unathi Henama, Social Observer. Foto:

Unathi Henama, Social Observer. Foto:

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IN HIS book Flashes of Thought, the writer Mohammed Bin Rashid Al Maktoum writes the story of how Emirates, one of the largest arlines today, was established.

In his book, he reflects on how the open skies policy that Dubai had adopted was challenged by the airline that controlled more than 70% of the traffic, which requested that the open skies be shelved – a request that was turned down by Dubai.

According to Maktoum, “the first lesson to be learnt is that competition always makes you stronger and better. Competition is feared only by the weak.”

Around the early 2000s, the CEO of South African Airways was possibly the most hated man in the tourism industry. He had cut travel agencies’ commission in line with global trends and internet bookings for airlines increased, instead of using the travel agencies as middlemen.

Technology had changed the face of the tourism industry and had put the power in the hands of the customers.

The travel agencies that responded to these market forces as a reality were able to add service fees and diversify their service offerings by focussing on cruise liners that were offering higher commission than airlines.

The taxi industry in South Africa must brace itself for the rise of Uber.

Uber is a smartphone-driver taxi service that is challenging the maxi taxi industry, specifically and generally the minibus taxi industry. It has also led to mode switching from buses to Uber in destinations where it has been introduced.

Uber has recently been launched in Port Elizabeth and Bloemfontein should be the next site as it targets towns with a population of more than a million. Port Elizabeth is the right city in Africa to launch after Johannesburg, Cape Town, Durban, Pretoria, Lagos, Cairo, Nairobi and Casablanca.

Mangaung recently became a metropolitan municipality, so Uber is part of the metropolitan municipality club.

The growth of Uber is an unstoppable tsunami and no amount of talking bad of Uber can wish it away. Parliament needs to urgently draft legislation to respond to this transport phenomenon of the future, just like South Africa needs to draft cybercrime legislation.

Wesbank, the vehicle finance provider of Rand Merchant Bank, has launched a lease option, as Wesbank saw potential to profit from Uber.

The Uber vehicle solutions programme allows Uber drivers who have no access to traditional credit to qualify for a full vehicle maintenance lease.

Uber allows people to become their own bosses and it has been increasingly opposed by meter taxi drivers. Meter taxi drivers have a problem, because they are required to have metered taxi driver permits.

The Western Cape provincial government has proposed a promulgation of a municipal by-law that will allow for e-hailing.

An amendment to the National Land Transport Act will have to be done to respond to e-hailing.

On 8 December 2015, Uber was welcomed in Port Elizabeth by the CEO of the Nelson Mandela Bay Tourism. Uber puts the power in the hands of customers, because the driver of Uber is rated by the customer, as customer service is regarded as top priority.

This can ensure that bad drivers are weeded out and this is possibly music to the millions of South Africans that are subjected to institutionalised poor service.

The taxi industry will oppose Uber, because it has institutionalised poor service and, as Maktoum noted, competition is feared only by the weak.

Uber will be great for the residents of Bloemfontein and will change the reality of transportation.

Tourists and business people will readily demand Uber when they arrive in Bloemfontein, therefore there is already a market for it here.

  • For the weak: Start developing foam around the mouth, as Uber is coming. Unathi Sonwabile Henama is an alumni of the Central University of Technology (CUT), a member of the Black Management Forum and writes in his personal capacity.

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