Industry Research

Uber Impact Study Reveals Wide Range of Opinions

Posted on February 21, 2016 by Tom Halligan - Also by this author

Page 1 of 3

The rapid and global growth of Uber quickly muscling in on the private transportation industry — legally and illegally — is the most disruptive force to ever affect traditional limousine companies, taxis and black car services.

However, reactions to Uber, the leader among transportation network companies (TNCs), is mixed. Opinions from individual operators are all over the map. At the extreme ends, operators assert that Uber is the Dark Force that will kill off the entire industry, while others shrug and don’t see any harm to their businesses. Between those two polar opposite viewpoints stand most operators who are trying to sort out this new competitive world of technology-based, on-demand seamless transportation services.

Given the wide-range of operator opinions, LCT commissioned a survey, conducted by Bobit Business Media research, in December 2015 to take the collective pulse of the industry to find out where operators stand on TNCs and related issues. Respondents included a cross-section of large, medium and small operators with 64.6% reporting fleet size from one to 10 vehicles.

The results of our exclusive survey, “LCT Magazine Industry Uber Impact Study,” are presented in this article complete with charts and graphs that provide the industry its first true analysis about the effects of TNCs.

The survey results are presented in categories gleaned from respondents’ answers to an array of diverse questions addressing specific TNCs, as well as ancillary results stemming from on-demand technology and subsequent competitive and financial effects.

TNCs and Your Business
Looking at the big picture, when asked what effect TNCs have had on operations, the results were mixed: 35% of respondents cited “mostly negative” viewpoints; 32.5% had a “mixed” response; 16% reported no effect on their business; 9.2% “can’t tell” at this point; and 7.4% cited a “mostly positive” experience.

However, when asked questions about their attitude toward the spread of mobile on-demand reservation apps, 84% responded that advancing technologies are inevitable and our industry needs to adapt, and are a positive development that will drive more people to use chauffeured transportation. About 25% responded that “it’s the beginning of the end of the livery business as we know it.”

Underscoring the majority opinion, almost 70% agree that corporate customers could benefit from mobile on-demand app technology, and 73% believe their retail business can benefit from the technology.

Financial Effects of TNCs
No other issue surrounding the spread of TNCs has created more discussion — and angst — among operators than TNCs’ financial effects on their businesses. The survey results give the industry its first hard look at revenue lost. About 23% reported no loss of business; 39% said less than 10%; 18% reported 10% to 20%, and 20% reported a loss of more than 20% of business.

Operators who lost business to TNCs overwhelmingly reported (almost 90%) a decrease in airport runs and evening/nights out and weekend business. Realizing the impact of TNCs on that portion of their business, 74% of operators indicated that they believe mobile-app technology can help their retail business while 26% said it could not.

To counter market pressures from TNCs, some operators have changed their pricing structure, but most (66%) have not. Those who did reported using more flat rates and few hourly rates (24%), while others lowered rates across the board, introduced tier pricing, or added surge pricing.

Further, when operators were asked if they varied/adjusted their fleets due to TNC competition, 63% said no, but 25% said they have bought or plan to buy newer, more expensive vehicles to distinguish their operation from TNCs. 12% reported they plan to buy cheaper vehicles to lower their overhead.

View comments or post a comment on this story. (2 Comments)

More News

Business Travelers More Anxious About Security

This new development reaches beyond the typical concerns of high-profile travel disruptions and terror incidents.

What Do Trump's First 100 Days Mean For Travel Industry?

The nomination of Elaine Chao as Secretary of Transportation is among positive developments.

Do TNCs Really Prevent Drunken Driving?

Not all studies have reached the same conclusion.

Fact Book Survey Closing In For Your Responses

Print Or Digital? LCT has you covered this year with its annual LCT Operator Business Survey.

Domestic U.S. Business Travel Hits A Downturn

The sector slipped into negative territory on the U.S. Travel Association’s index, meaning a slowdown has occurred.

See More News

Facebook Comments ()

Comments (2)

Post a Comment



See More

LCT Store

LCT Magazine - April 2017 $12.95 F&I / SPECIAL EVENTS ISSUE COVER STORY: * Don't Panic: Confronting Worst Fears - Fleet Risks * *


Experience the three annual industry events for networking for business, showcasing vehicles and products, and getting the tools for success.

Read About Your Region

What’s Happening Near You?
Click on any state to see the latest industry news and events in that region.

More From The World's Largest Fleet Publisher

Automotive Fleet

The Car and truck fleet and leasing management magazine

Business Fleet

managing 10-50 company vehicles

Fleet Financials

Executive vehicle management

Government Fleet

managing public sector vehicles & equipment


Work Truck Magazine

The number 1 resource for vocational truck fleets

Metro Magazine

Serving the bus and passenger rail industries for more than a century

Schoolbus Fleet

Serving school transportation professionals in the U.S. and Canada

Please sign in or register to .    Close