“Welcome to Hell”: Barcelona Taxi Drivers Prepare for Uber’s Return

Uber has struck a more conciliatory approach this time, but taxi drivers are not convinced.

By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET.

War is about to break out once again between Uber and the highly mobilized taxi drivers of one of its most febrile markets, Barcelona. After three years of absence due to regulatory issues as well as the hostile welcome it received from local taxi associations, the ride-share giant announced this week that it was returning to Spain’s second largest city.

This time will be different, it says. “We are changing the way we work. And Barcelona is no exception. We want to work with local agents to help build a mobility model that is more sustainable,” said the company in a statement. The company has long shown a special interest in the Catalan capital because of its tourist influx and potential for business.

Uber marked its Barcelona comeback by placing over 100 advertisements around the city with the tagline, “More than a journey. Barcelona, your Uber has arrived.” In less than 48 hours, around half of the ads had been defaced, with the word “Uber” replaced by the word “taxi.” The company’s logo was also concealed and the image of an Uber vehicle swapped for that of a black-and-yellow Barcelona cab.

That was just the beginning. On Thursday night, an estimated 300 taxis blocked access to the city’s main bus station, Estacio Nord, to prevent the departure and entry of buses belonging to the transport company Alsa Coaches, which has been closely linked to the sale of the VTC licenses that allow ride share drivers to operate in Spain.

Due to loopholes in Spanish law, companies have managed to rack up indecently large profits by buying up batches of these permits from local councils for as little as €32 a piece and then selling them on to ride-share drivers for tens of thousands of euros. In Madrid VTC licenses can sell for as much as €65,000 each. When the Community of Madrid finally cottoned on to the scam, it refused to continue selling the licenses. But the decision was appealed by the same rent-seeking transport companies, and Spain’s Supreme Court predictably ruled in their favor.

Other irregularities and abuses abound in Madrid’s burgeoning ride-share business. In the last year the police conducted 10,128 inspections of passenger transport vehicles with up to nine seats. The infraction rate of the vehicles operating with Uber and Cabify was a staggering 42%. Also, by law there is supposed to be a maximum of just one VTC license for every 30 ride-share vehicles but that number is allegedly on the rise.

Taxi drivers in Barcelona worry that Uber will show the same disregard for the law in Barcelona as they have done in Madrid. A common fear is that the “cockroaches” — as the black cars used by Uber and Cabify drivers are endearingly termed — will once again concentrate their activity in high-wealth areas, which is prohibited in the current Royal Decree on the Regulation of Land Transport.

Uber has struck a more conciliatory approach this time around. “In recent weeks we have spoken with representatives of Catalonia’s regional government, parliamentary groups, competition regulators and also with the Barcelona City Council,” said Juan Galiardo, Uber’s director for Spain. “Our starting point was to explain that we are coming back, that our model is legal, that we want to do things well. There is a market for everyone.”

Many taxi drivers are not convinced. Following the announcement of Uber’s return, Alberto ‘Tito’ Álvarez, spokesperson of Elite Taxi Barcelona, the taxi drivers’ association that organized the boycott of Alsa Coaches, delivered a stark message: “Uber and Cabify drivers, welcome to hell!”

In Madrid tensions between taxi drivers and car-share drivers recently escalated into violence as around 50 ride-share cars were pummelled with stones and showered in acid. Elite Taxi has already warned that it plans to take industrial action against Uber every day next week.

Given the financial pain Elite has already caused Uber, the ride share firm’s management is unlikely to take the threat lightly. Last year the taxi drivers’ association took the global tech giant to the European Court of Justice (ECJ) over its Peer-to-Peer service UberPop, which hooked up nonprofessional, unlicensed drivers with riders. It was a David versus Goliath case, and it was David who came out on top. Not only did the ECJ rule in the taxi firm’s favor but it also declared that Uber was a transportation business, not just a technology platform.

It was a big setback for a firm that spent much of last year mired in corporate scandals and struggling with huge losses. Uber was also recently banned from operating in London after being accused of a string of failures over passenger safety. Undeterred, the firm hopes to win back Transport for London’s approval through a series of talks, while a legal appeal against the ban allows it to keep operating in the UK capital without a licence.

Since the ECJ ruling, the UberPop service has been withdrawn in Spain and several other countries. The ruling will nonetheless force Uber to comply with the bloc’s rules for taxis and other transport companies, meaning the company could face stricter licensing and other requirements.

But ultimately it’s up to each EU Member State to regulate the conditions under which transport services are to be provided, as long as they are “in conformity with the general rules of the treaty on the functioning of the EU.” In Spain the central government, market regulators and legislative branch are largely lined up in Uber’s favor. In April, the Supreme Court could even decide to scrap the current one-license-for-every-30-drivers cap, which would lead to a surge in ride-share services.

That would raise tensions even more. “Everything is really calm now, but the instant Uber sets foot here, it’s going to be a mess,” said Tito Álvarez, spokesman for Elite Taxi. “We cannot control what happens on the streets when their cars start rolling out.” It’s an ominous warning that sounds more like a threat — and one that Uber, in all its worldly hubris, is unlikely to heed. By Don Quijones.

Beginning of the end for “Investor-State Dispute Settlement” clauses that have become toxic to democracies? Read…  European Court of Justice Deals Heavy Blow to “Corporate Sovereignty Clause” 
 

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  37 comments for ““Welcome to Hell”: Barcelona Taxi Drivers Prepare for Uber’s Return

  1. Nicko2
    Mar 17, 2018 at 12:24 pm

    Uber has a lot of bad blood in many places….but what are those taxi drivers going to do when the automated driving revolution hits? …It’s only a few years away. Many cities have already started trials of automated taxis.

    • Gary
      Mar 17, 2018 at 1:09 pm

      Just because they have started trials, doesn’t mean the results are assured.
      Also, there can be many motivations for promoting “automated driving”, not necessarily to actually implement it for real. (i.e. stock scams, etc.)

      I myself like to apply the principle of “critical thinking”

      • Tom T
        Mar 19, 2018 at 10:03 pm

        Gary,
        ‘I myself like to apply the principle of “critical thinking” … truly then Gary, you are a highly endangered species …

    • Tom Ratliff
      Mar 17, 2018 at 3:49 pm

      An unoccupied automated vehicle strikes me as being easy prey for those wanting to put it out of service.

      • Thunderstruck
        Mar 18, 2018 at 3:25 am

        “An unoccupied automated vehicle strikes me”

        For some reason that part of your statement has stuck in my head as a mental picture – of being run over while crossing the street, by a car that is on autopilot – and waiting for a computer reboot or a GPS satellite fix.

        • Mar 18, 2018 at 8:31 am

          You don’t need “an unoccupied automated vehicle” to do that job. About 6,000 pedestrians were killed in the US in 2016 by vehicles driven by human drivers. Human drivers are terrible drivers.

        • safe as milk
          Mar 18, 2018 at 10:15 am

          i’m skeptical of this technology, too. they have actually passed an exception to ny state law so that gm can start testing autonomous vehicles in manhattan. as wolf points out, the statistics on pedestrian deaths and injuries from cars are terrible. however, a disproportionate amount of that carnage is caused by male drivers in private cars. speeding and not yielding to pedestrians is an epidemic where i live. from my experience, the police are the worse offenders… way worse than taxis. the official nyc statistics as of 2009 were:

          – Pedestrians accounted for 52% of traffic fatalities from 2005-2009.
          – 27% of fatal pedestrian crashes involved driver failure to yield.
          – 80% of crashes that kill or seriously injure pedestrians involve male drivers.
          – 79% of crashes that kill or seriously injure pedestrians involve private vehicles, not taxis, trucks and buses.

        • Javert Chip
          Mar 19, 2018 at 11:06 am

          safe as milk

          Not excusing bad drivers in any way, but there probably are also at least some bad pedestrians helping to thin out the gene pool.

          I doubt 100% will be “saved” with automated driving.

    • Kent
      Mar 17, 2018 at 5:36 pm

      what are car companies going to do when the jet pack revolution hits?

    • Rates
      Mar 17, 2018 at 6:11 pm

      Read this: https://arstechnica.com/cars/2018/03/new-report-highlights-limitations-of-cruise-self-driving-cars/

      Cruise is testing in SF. This is relevant since Waymo, etc did their testing in much easier places.

      “, Cruise employees trimmed a bush ahead of a demonstration for journalists to make sure the car wouldn’t swerve while driving past it.”

      LOL.

      There’s also recently a study of a team of MIT being able to pretty much break every Neural Network Vision model out there.

      When it’s all said and done. There’s going to be nothing different between this and the performance of AI hedgefunds that Wolf liked to post i.e. when disaster hits, it will be YUUUGE. After all they use the SAME mathematical techniques. So when one swerves, guess what the others do.

        • Mar 19, 2018 at 1:22 pm

          6,000+ pedestrians will be killed this year by human drivers. Good bye, human drivers?

        • Rates
          Mar 19, 2018 at 6:05 pm

          Wolf, 6000 is a bad number, but you have not demonstrated how this tech will not amplify a single incident. AI is just Machine Learning on steroids, so basically Math Models. How is that different from the “models” that AI hedge funds use? So when correlation goes to 1, can you prove that the number of accidents will be less than 6000?

        • Gary
          Mar 19, 2018 at 6:08 pm

          Wolf come on, that was a sophomoric response.

          There are millions of driving hours logged each year by regular cars, hence the higher death number.

          So far, we have several incidents already with only a handful of autonomous vehicles on the road. What’s going to happen if there were millions of autonomous vehicles?

        • Mar 19, 2018 at 6:30 pm

          Gary, Pavel, and Rates,

          This wasn’t a statistical reference. These are prototypes, not production models. It was a reference as in this example (because this is how it works):

          On September 14, 1899, at West 74th Street and Central Park West in Manhattan, a guy named Henry Bliss got run over and killed by a taxi (an electric one, as were 90% of the taxis in New York City at the time). A plaque there pointed out (I saw it when we lived there though I don’t know if it’s still there) that it was the first automobile fatality in the “Western Hemisphere.”

          This first automobile fatality has not stopped the development of the automobile. This is what my comment meant. One fatality – when we have thousands of fatalities caused by humans – isn’t going to stop a development that will eventually pull these terrible human drivers off the road. You can count on it.

          I agree that this won’t happen tomorrow. But it will happen sooner than some people expect. And yes, there will be more fatalities. Meanwhile, 36,000 people will get killed by human drivers every year…

        • Rates
          Mar 19, 2018 at 8:05 pm

          To Wolf. I hate driving. In fact I don’t know how to drive. Autonomous cars in theory should be my salvation.

          But, no one (sorry not even you) can say that the current solution (math models) will absolutely cover the last 20% of the problems. In Big Data, it’s known that with more data you can always improve the performance of any model so that one model or a combination of models (Ensemble) can solve 80% of some problems. This is why improvements seem to be “rapid” initially. Just feed it more data. This is fine if the remaining 20% is not important, but they usually are.

          Take a simpler problem where similar techniques are used. Facial recognition. Should be easy right? But it turns out it’s not. Change the angle from which a face is seen and the model will much more likely than not recognize the face as belonging to a different person. This is one class of Computer Vision problem that people have been trying to solve for a long time with minimal success if any. In fact you solve this, and any of the FAANGs will give you a blank check.

          The underlying problem is that these techs do not understand real world concepts. It knows there’s A, B, and C, but it doesn’t know what A, B, and C is or even if there’s a D. The Silicon Valley show captured this very humorously with the Hot Dog/Not Hot Dog app. And although it might appear as a joke, but the fundamental truth remains i.e. someone has to label everything out there.

          And then there’s security issues. Our CPUs have bugs. They shush shushed it, but really, there’s an underlying issues with all CPUs in this world. It’s just a matter of time before someone manages to exploit it.

          Ok, after all that. Why does this matter? Well once an accident happens, surely the first question would be: why did it happen and who’s to blame for this? An AI can’t explain itself other than, well there’s this input and here’s the output. That could be because a child has been mislabeled by someone as a monkey or even the condition of the inputs i.e. the Lidar makes a child look like a monkey or even software bugs.

          In the end, though who’s gonna pay? If it’s someone hitting someone else, that someone might be able to get some sense of closure, but in the AI case? Either it will be, well it’s still lower than 6K or 60K in which case, sorry you are within tolerance or the blame will be hard to aportion between the car, the company (the management), or even the software engineers.

          Now to close this: I am an engineer. I believe one day there will be self driving cars, but it will use AI techniques FAR beyond what’s available today. And no, we won’t get there soon.

          Now if you tell me that they will combine this with a MASSIVE infastructure project where roads will be simplified so that even the dumbest self driving AI can navigate them and no humans will be allowed to drive, that will be a different story. There’s so much pork there …

    • MC01
      Mar 18, 2018 at 3:39 pm

      Autonomous mine trucks have been around since 2005 and entered limited commercial operations in 2008 already with Codelco introducing Komatsu AHS technology to their Chilean copper mines. There are now over one hundred autonomous mine trucks in operations split between Australia (Rio Tinto), Canada (Suncor) and the aforementioned Codelco operation in Chile.
      These lorries are conversions of 803/903 trucks and as such still feature a driver cabin and the capability to be be driven normally, but Komatsu has unveiled a yet unnamed truck in the 200+ tons class which features neither a cab nor the customary selva of antennae of the conversions. It’s the first purpose-built fully autonomous mine truck, and Rio Tinto is negotiating a contract for up to 150 with the Japanese manufacturer.
      Why not more? Because they are still very expensive, but the price is bound to come down as Komatsu’s competitors scramble into the autonomous segment and technology matures.

      Similar technologies are currently being developed or field tested for combine harvesters, dozers, demolition vehicles and even container ships. There are even talks of “tailor robots”, doing a job industrial machines haven’t been able to even start tackling yet: making shirts and jackets.
      Nobody objects. There are no “doomers” predicting the rise of a Colossus or Skynet wiping out mankind with an army of mine trucks and combine harvesters.
      In fact there’s too much optimism, masking the fact most companies have no prayer of making a commercially viable product, but the stakes are so massive the capitals been thrown around are staggering.

      But when it comes to cars… somehow things change, and radically so.

  2. bob
    Mar 17, 2018 at 12:34 pm

    a bit like the adverts for homeaway on your site. most of the people with a advert have no licence in spain . so are illegal.

  3. WT Frogg
    Mar 17, 2018 at 12:40 pm

    Uber and it’s cars remind me of what we used to call “Speedy cabs ” ie. basically unlicensed cabs run buy untrained operators. Driver skill is variable at best and their vehicles run the gamut from roadworthy to down right unsafe. Cheap yes, but good luck suing for damages to person or property in the event of an “At Fault” accident.
    No Thanks. I’ll bite the bullet on the fare from a legal cab or limo service.

  4. raxadian
    Mar 17, 2018 at 1:50 pm

    Spain is in the middle of a ‘disguised’ economic crisis and civil war (Catalonia) and tourism is one of the main forms of earning a living.

    Violence is becoming more and more common in the streets and if you ask me if it is a good time to visit my answer would be “Only if you avoid the conflict cities like the plague.”

  5. Paulo
    Mar 17, 2018 at 2:29 pm

    Good for the Taxi companies and drivers. Years of investment and adhering to regs, insurance coverages, fleet maintenance, etc and some ride share out-of-work Fiat owner is going to come in and undercut your livlihood. Best stop it before it gets established.

    This race-for-the-bottom in all things is a social cancer. Follow the trend and pax will be able to double up on a scooter for even less money.

    Regulated transportation protects the riders and workers, both. If people don’t like the options there is always regulated public transit, car rental firms, and/or good old shoe leather. Hey, try hitchhiking if you need a ride. Uber is just one step up from it. In most cities you can get a ride for a BJ; even cheaper yet!

    • Javert Chip
      Mar 19, 2018 at 11:13 am

      Paulo

      Definitely, horse-drawn cars were much better.

      Maybe even have the government just make everybody walk.

  6. Laughing Eagle
    Mar 17, 2018 at 4:46 pm

    I don’t think Uber drivers realize the risks being transferred to them- not only the cost of the vehicle and it’s maintenance but the cost of insurance liability, with high coverages and uninsured motorist.
    With the automated car, is the liability the owner or the automation company in an accident? Could take longer than a few years for the courts to settle this liability.
    With the future, will bicycles become the major mode of transportation before the automated car? If future technology keeps eliminating jobs or cuts down on the number of workers needed, how large will the market be for costly cars?

    • Kent
      Mar 17, 2018 at 5:42 pm

      Uber drivers don’t understand it, but they are just trading years of useful car life for cash now. It’s something you do when you’re desperate for shoestring-term cash to pay your bills.

    • Tinky
      Mar 17, 2018 at 7:17 pm

      I recently saw an “Uber Eats” delivery person on a rented scooter in Lisbon. Hard to believe that could work, either.

      • Frederick
        Mar 17, 2018 at 11:41 pm

        Those “Uber eats” guys use bicycles in Warsaw I first noticed them last summer and they were everywhere

  7. Pavel
    Mar 17, 2018 at 11:43 pm

    I just took a cab in NYC the other evening and without my prompting (though I often ask drivers how they are doing in the post-Uber world) the 50-ish driver from India said his business was terrible and the medallion that was worth a million dollars 5 years ago is now worth $100K. He said with pride that his son just finished med school and his daughter is going to college but as Uber has destroyed the NYC taxi business he has decided to declare bankruptcy and return to India after 20 years hacking in NY.

    We all had our complaints about taxis in every city in the world probably (though few complaints in Singapore perhaps! Cheap, safe, efficient) but when they are gone Uber will raise the prices and further screw their drivers (who are now only making minimum wage at times).

    As for the famous autonomous cars, I think that is a pipe dream. Once they are out in the wild there will be so many accidents and so many lawsuits nobody will insure them.

    • Pavel
      Mar 19, 2018 at 1:52 pm

      And 3…2…1 Uber autonomous car kills woman in Arizona.

      • Mar 19, 2018 at 2:51 pm

        Human drivers killed 6,000 pedestrians in the US in 2016. That’s 92 on average every day.

        • Pavel
          Mar 19, 2018 at 6:12 pm

          Surely we need this calculated as “deaths per mile driven” as I believe there are only a hundred or so of the autonomous cars being tested (with this first death) vs all the regular cars on the road!

  8. Realist
    Mar 18, 2018 at 7:44 am

    Regarding Uber, one of the ways they undercut the competition is that Uber does not provide anything for pensions, while their competitors have to do this in most civilized places. The cost for veichles, fuel etc is paid by the person who drives for Uber and when all costs are deducted from what Uber pays out to the driver, there’s no room for any savings for pensions and health insurance among other things, thus it means that in the end taxpayers are subsidizing Uber’s business

  9. Pangloss
    Mar 18, 2018 at 9:42 am

    Disenfranchised workers doing desperate Uber gigs only to be ‘disintermediated’ once again by autonomous vehicles. These folks will have plenty of time on their hands to figure out ways of jamming AI vehicles – and there won’t be the moral ambiguity of a fellow driver losing a livelihood. More interestingly, violent anti-AI won’t be required, if all you have to do is plant greenery in unexpected locations. The AI fleets may simply become … immobile.

  10. grant
    Mar 18, 2018 at 5:35 pm

    uber governance has no plan for the company what do they want to do with uber?a cheap taxi Company is ok because dirverless car will never work it,s just hype.
    Lyft is replicating uber with more success.uber intends to break into too many markets they should concéntrate in being a transport company.

    At the moment in Barcelona there they are a lot political problems the economy is really doing bad compare to before.There is not much work for taxis.Uber will bring more problems to the city.

    Maybe uber could concéntrate in others countries like germany france argentina chile canada where there is a lot of demand.Although uber has bad press in a lot of countries it could succeed has a cheap taxis Company uber should forget the hype and work on what they already implemented in a lot of countries

  11. james wordsworth
    Mar 18, 2018 at 5:42 pm

    Uber “cheats” in its competition with taxis. Its advantage comes from manipulating the system. It loses money on every ride on purpose (which alone should make it illegal). Ban the cheats until they play fair – that is, up their prices to at least cover their costs, as well as making sure they abide by laws on insurance and taxes as well.

  12. MooMoo
    Mar 19, 2018 at 10:49 am

    OK- I have to chime in. I understand what everyone is saying re: Barcelona, and the taxi world. And I tend to agree.But in London, I don;t – and the reason is personal.

    In the days when I could afford to take a taxi home from work everyday, Black Taxi drivers were rude, loud, insolent… and basically so far from a service, they made you think it was the privilege of your life to be riding in THEIR taxi… and the Livingstone put fares up 40% overnight…

    Had to hear EVERY SINGLE ARSENAL GAME at full volume… and if I ever asked them to turn it down. they’d just say, pay what’s on the meter and get out. Or… LBC talk radio at FULL VOLUME…

    Every night was a different horror show… but so exhausted from work, and public transportatipn so bad – there was little choice. Mini cabs could never make it IN to the city, as there was nowhere to wait – which was the privilege of the Black Taxi – with their taxi rank.

    Any problems were supposed to be reported to the “medallion Co.” and anyone who ever tried this knows, that only 1 in 10,000 complaint ever resulted in any action. In short – the Black Cabs p**sed on you and treated you like S*^& – because the had a monopoly.

    I have no tears for them. In fact – they go what they deserved. IMO.

    • Javert Chip
      Mar 19, 2018 at 11:32 am

      As an American businessman & tourist with 100+ trips to London over roughly 30 years, I’ve ridden in hundreds of London black taxis. My experience with this large set of human transactions includes very few “less than optimal” interactions (1-2%?).

      Your dystopian comment in no way represents what I’ve actually experienced. Angering the large a percentage of cabbies you interact with (including orders to pay & get out) takes real dedication.

      • MooMoo
        Mar 19, 2018 at 12:50 pm

        “Angering the large a percentage of cabbies you interact with (including orders to pay & get out) takes real dedication.”

        …whoever said that? Most of the time it was suffering in silence.

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