Industry leader and California operator Maurice Brewster contributes insights to a Wall Street Journal article.
Last Friday, my local newspaper ran an article about the launch of Uber’s Scheduled Rides program within my city. This just further disrupts local business and demonstrates a constant erosion of our business. While I might have retired as an operator in January, I am still financially invested in the company I built, and its continued success is of utmost importance to me for financial reasons.
When Uber launched in 2010, a mere six years ago, I was amused. Its launch in San Francisco had no effect on my local market and even as I watched Uber launch in New York, Chicago and other large cities, I didn’t believe the service would ever make it to my hometown of Bakersfield, Calif. The U.S. Census Bureau estimates the total county population of my area at 882,176 as of July 2015. That’s important to note as the entire county is our service area. By 2013, there was no sign of Uber, and most people around this dusty city in Central California hadn’t even heard of Uber much less the concept of “electronic hitchhiking."
On June 13, 2014, that changed as Uber had a launch party at a local hotel and made a big splash. That was the first wave of disruption to our business. In September 2014, Uber really hurt me for the first time in multiple ways. Each September, an annual charity event called Village Fest is held in our city, drawing high demand for our service with waiting lists of people hoping someone cancels.
Some 7,000 people come out to sample the offerings of 60 breweries and 25 wineries while listening to 17 bands on five stages set over 16 acres. More important to note is I am the president of the charity producing the event since 1999. I was dismayed to walk into the event and be greeted with Uber flags stuck in the ground and Uber information kiosks set up around the grounds. I was livid when my luxury vehicles had to share curb space with Honda Civics and Volkswagen Jettas at the end of the night and, for the first time ever, we had no waiting list and did not sell out.
By June 2015, Uber was fully entrenched and embraced in my community. I began feeling more waves of destruction as my clients who previously engaged our services for a night out on the town were using Uber and telling me there was no reason to pay for a chauffeured vehicle to sit outside a nightclub all night when they could simply call an Uber. The Uber would arrive within 10 minutes and had no 3-hour minimum like we do. That hurt. You can say it left a mark, too. The mark was a significant decrease in Friday and Saturday night revenue which was eroding away. Since retail work is only a sideline to the Monday – Friday corporate accounts, I wasn’t too concerned, but it still hurt.
Now, Uber has launched its Scheduled Ride program this week. That’s hitting closer to home. What stops a travel coordinator or an executive assistant from just ordering up an Uber for that executive’s trip to the local airport next Friday? The fare for a premium luxury vehicle to our local airport is $14. Our fare for a local airport transfer is $63. That’s a $49 difference! If I wanted to take a two hour drive to LAX, Uber charges $147 while we charge $316 for the same vehicle. That’s more than double the price of Uber. This will leave a bruise.
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