Bickering Berlin Taxis Keeps Griping About Uber and Custom Rates
Taxi Association Commemorates Milestone - Marking a Decade of Wheeled Service - Innovative taxi industry faces a halt on its anniversary due to the application of the hand brake
Let's face it
The taxi industry in Berlin is in the throes of drama. "The demand is dismal," admits Leszek Nadolski, the first chair of the Guild of Berlin Taxi Trades, which is celebrating its 125th anniversary this coming Friday. Many drivers are stranded, relying on delivering rides through Uber and other intermediaries to keep afloat. The introduction of a fixed-price option for cab rides last year didn't prompt a surge in usage.
However, Nadolski views the move positively. The fixed-price option provides passengers with a pre-set cost when booking a taxi, adjusting depending on the trip's length. Eliminating the nail-biting count-up of the taxi meter display is appreciated by passengers, as per the guild chairman. Even Freenow, a popular taxi intermediary, gave a thumbs-up after a year of implementing the fixed pricing in Berlin.
Conflict of the Hour: Minimum Rates
The tension in the taxi market remains high, with the competition from rental car platforms like Uber and Bolt a constant bone of contention. The primary contentious issue is the minimum rates: taxi companies are barred from offering rides below a specific price threshold, whereas rental cars have leeway to adjust fares on demand.
To comply with regulations, rental car drivers must report back to the company headquarters after each trip; they can only pick up passengers on the fly if they receive a new booking. Nevertheless, this flexibility gives them an unfair advantage over the taxi industry's viewpoint, leading them to demand the introduction of minimum rates for rental car platforms. "Then, the edge goes to the better service provider and the one who makes the superior ride offer," hopes the guild chairman.
Senate Deliberating Minimum Rates for Rental Cars
The Senate declared in January its intention to scrutinize the enforcement of minimum rates. As of my last inquiry, the examination is still ongoing, and no progress updates were provided. However, a decision is expected this year.
Berlin followed Leipzig's footsteps in 2021 by imposing minimum tariffs for rental cars. One company challenged the decision, resulting in the Administrative Court of Leipzig ruling in November last year that tariff ceilings can be acceptable but were excessively high based on the city's rate setting in the case. Similar court battles may occur in Berlin if a corresponding regulation is implemented.
Yet, the taxi industry's cries seem to be resonating with the political sphere. Besides examining the minimum rates, the Senate Administration has stepped up its efforts against illicit companies on the platforms operating sans a permit. The State Office for Citizens' and Public Order Affairs (Labo) inspected the entire vehicle fleet on the rental car platforms Uber, Freenow, and Bolt last year and eliminated hundreds of vehicles.
The platforms considered the move beneficial and necessary, but they've now started criticizing the approval process of the Lab. The application processing duration is too long, and there's scant consultation provided for the car rental providers. Moreover, fresh reasons for the denial of approvals frequently surface, often unclear. It appears that several car rental companies have shifted their fleets to smaller towns in the Berlin outskirts, overburdening local authorities with vehicle inspection while the Lab is no longer responsible. The Brandenburg County Council fears a spillover of the "shadow economy in the car rental industry." Toward the end of June, the Brandenburg Ministry of Transport will convene with Berlin and representatives of the counties to discuss the escalating issue.
In light of the ongoing dispute, the taxi industry is advocating for the introduction of minimum rates for rental car platforms, arguing that it would level the playing field and favor the provider offering superior service.
The Senate's examination of minimum rates for rental cars is still in progress, with a decision expected this year. If implemented, similar court battles to those in Leipzig might ensue.
Meanwhile, the State Office for Citizens' and Public Order Affairs has taken action against illicit companies on rental car platforms, removing hundreds of vehicles sans permits. However, criticism against the approval process and lengthy application duration persists, prompting car rental providers to shift their fleets to smaller towns, causing concern about a spillover of the "shadow economy in the car rental industry."