Uber is not the shining paradigm of public relations. From its start, the company has been accused of aggressive tactics to gain business, from disregarding government regulations, predatory surge pricing, and poor treatment of driver’s complaints, to upsets caused by the CEO himself, Travis Kalanick.
The scandals have been piling. In 2014, the business was labeled as a brash startup and disruptive, adopting an expand-now, negotiate-later approach. They ran into problems when Portland, Oregon accused it of operating illegally. The New York Times reported that in December 2014, “despite protests from the mayor and the commissioner of the city’s transportation bureau,” Uber started offering services in Portland. Portland sued Uber in retaliation, claiming it was operating an “illegal, unregulated transportation service.” The city’s main issue with Uber, besides its disregard of their requests, is that it doesn’t follow rules on public health and safety that taxicab companies do. The city’s cabs pass an “annual vehicle test and are subject to a fare cap” and “20 percent of the permitted fleet must be equipped for people who need wheelchairs.” Uber widely broadcasted its defiance, even starting a petition against the city in support of itself. Uber has faced lawsuits in other cities as well, such as Washington, D.C., New York City, San Francisco, and Las Vegas. It has not done well to gain the acceptance of other taxicab companies in cities.
Uber has also faced criticisms of its “predatory surge pricing.” In order to encourage more drivers to work for it, the company employs “surge pricing,” which raises fares during times of peak demand or short supply. During a snowstorm in New York City in 2013, rates tripled. “Surge pricing only kicks in in order to maximize the number of trips that happen and therefore reduce the number of people that are stranded,” Kalanick told WIRED. Vivek Wadhwa, an academic and columnist who writes frequently about the tech industry and inequality, took to Twitter to complain when “he found that an Uber ride from San Francisco International Airport to his home in Menlo Park would have cost nearly three times the usual rate,” says WIRED, even though it was just drizzling. The regular cab he took instead cost about $90, including a $10 tip. Another women was outraged that 12-mile ride home that normally cost her around $30 to $40 was now over nine times the average fare at $360.
Customers and cities aren’t the only ones to complain about Uber; it’s drivers do too. In 2014, there was a large strike of over 1,000 Uber drivers in New York City. Rather than being treated like partners and receiving better pay, as they were originally promised, they faced “rate cuts, mandatory fares, and underhanded corporate tactics,” according to BuzzFeed. The drivers argue that by “undercutting the costs of taxis and other car services, Uber is trying to monopolize the industry,” and if they do drivers would be stuck with “sub-taxi fares and no tips.” A recent protest also happened in November 2016. Uber drivers joined the “Fight For $15” with cashiers, hospital workers, fast food workers, and others in the strike action. Newsweek stated, “Uber drivers are expected to leave their cars sitting idle in high-profile locations, such as airports.”
And then another problem is Uber’s very own CEO, Travis Kalanick. He is known for his brash language and decisions, but a recent event caused even him to release a public apology. A video surfaced of Kalanick arguing and cursing at one of his own workers as he got a ride from him. It occurred in the car of Uber driver Fawzi Kamel, who turned the footage into Bloomberg. When Kalanick entered his car, Kamel took the opportunity to ask the CEO about falling fares. The conversation resulted in Kalanick saying, “You know what? Some people don’t like to take responsibility for their own s***. They blame everything in their life on somebody else. Good luck!” Kamel told NBC why he stood up to Kalanick: “‘Uber kept dropping prices every season to gain more ridership to satisfy their growth, and it didn’t matter to Uber if the driver is not even making minimum wage,’ he said. ‘And the worst part is, they call us partners, [but] they make the rules, set the price and they even choose the cars you can use.’” Once the footage went viral, Kalanick issued an apology where he stated, “It’s clear this video is a reflection of me—and the criticism we’ve received is a stark reminder that I must fundamentally change as a leader and grow up. This is the first time I’ve been willing to admit that I need leadership help and I intend to get it.” He gave a “profound apology” to Kamel, the driver and rider community, and the Uber team.
While it is unclear what “leadership help” he intends to pursue, it is clear from the string of lawsuits, complaints, and protests that he could certainly use some assistance in brand and image management. An “expand-now, negotiate-later” approach assumes there will be a “later,” and if most bridges have been burned, there may not be. Alienating cities and traditional taxicabs extinguishes any possible support from institutions that have existed long before Uber. And unhappy drivers causes a slew of problems, from unmotivated workers to unsatisfied customers. Kalanick needs to consider where his tactics and actions will get him in the long run and what kind of image he wants his company to have. A crisis manger might not be a bad idea, either.