Australian car market: Car sales, statistics and figures
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Yes, it’s human nature to look at the past through heavily rose-tinted glasses, but the slowly dying taxi industry doesn’t exactly lend itself to fond memories. In fact, anything tinting your glasses is more likely to be flecks of old vomit, or spittle fired from the mouth of a cranky old driver complaining your trip is too short, or that Alan Jones isn’t on the radio 24/7.
Honestly, how many of you were really and truly happy catching dangerously old, suspiciously stained, appallingly driven and vaguely sick-smelling taxis, and paying extortionate fares for the privilege? It was only a matter of time until someone came up with something better.
That someone is now very, very rich, and that something is Uber. Imagine having a friend who drops everything to come and pick you up and drop you off at any time (a friend that charges for the service, that is). That’s Uber in a nutshell.
And while the Uber explosion has added an entire dictionary of new terms to the Aussie lexicon (“surge pricing” and “give me five stars” to name but a few), it has critically also deleted what might have been the most annoying phrase in the English language; “where the hell is my cab?’
And that’s because, where taxis were either flagged down or booked by phone, Uber uses the GPS on your mobile to not only tell the driver where you are and where you’re going, but to show you exactly where that driver is as he approaches.
More good news? The driver never finds out where you’re going until they have accepted the fare and you’re sitting in the car, so there’s no cherry-picking longer trips. Or any point whining about shorter ones.
But the ride-sharing platform isn’t without its own issues, and has already been banned in London over potential safety issues, mass-deleted in New York after breaking a taxi strike at JFK, and been the cause of several violent clashes between taxi and Uber drivers around the world.
Meanwhile, the taxi industry in Australia has been massively upping its game in the face of this new competitor, building its own apps, up-skilling drivers and cleaning up cabs.
So which is the best, cheapest and safest option for you? Let’s take a closer look.
In short, it’s a ride-sharing platform that allows users to book trips via an app and have the funds deducted directly from a nominated account.
Using the app, riders enter their basic contact and billing details. From there, they can choose from six vehicle options:
UberX - the cheapest option, and one in which you’re usually picked up in a driver’s own car
UberXL - An affordable six- or seven-person car, mainly SUVs
Select – Entry-level premium vehicles and the top-rated drivers
Black – Luxury rides with professional drivers, or what the taxi industry calls chauffeur cars
SUV – The SUV alternative to Black
LUX – A premium ride with an exclusive vehicle list (think Rolls-Royce or Maserati)
Before selecting one of the above options, riders must enter the details of where they are departing from and where they are headed. From there, the service uses your phone’s GPS to tell the driver where to pick you up, where you’re going and, using Google Maps, the best way to get you there.
The app offers a fare-estimate calculator that can give you a rough cost based on a distance-by-time algorithm. Taxis have the same method but without that level of convenience.
However, unlike Taxis, Uber also uses the much-maligned “surge” pricing system, which increases costs in line with how many people are using the app. More riders competing for drivers equals a higher surge price (which can be as much three or even four times the normal fare). On NYE or Australia Day, for example, you can expect to pay handsomely for your ride home. But at least you’ll get home; never a certainty in the pre-Uber age.
In Sydney, we ran four key tests; a CBD short trip, a suburban cruise, the airport adventure and the city to home trip. We ran each through calculators on the Uber and taxi sites during off-peak times to ensure no surging or major traffic changes would impact the fares.
CBD short trip – Central to Circular Quay
Suburban cruise - Ashfield to Newtown
The airport adventure – Domestic Terminal to Bankstown
The city to home trip – Wynyard to Bondi Junction
Perhaps the biggest difference between taxis and Ubers, besides cost, is the rating system. Riders rate drivers and vice versa, handing out a score of between one and five stars for each trip.
For users, the rating systems is often a badge of honour, with people comparing and sharing how many stars they have. This rating also acts as a guide for drivers, as riders with a lower rating can be relegated to the naughty corner of the Uber community, and drivers might opt to cancel the trip rather than pick you up.
For taxis, this is no issue. You just flag one down and get in. Simple. Sure, you can be kicked out of one for unseemly behaviour, but that leaves the driver out of pocket.
But while the rating system can take some getting used to, especially if you’re prone to being a dick in taxis, it’s probably the best part of the Uber process. Both the driver and rider have an incentive to get along - or, at the very least, be polite to each other - and catching an Uber is often a far more positive experience as a result.
For Uber drivers, though, the star system is far more important. Maintaining a rating of 4.6 or higher is vital to remaining a driver. If they begin to slip below that mark, Uber will notify them and warn them that they need to improve. If they don’t, they’ll be booted from the app.
And that’s what makes Uber different from any taxi in the country; trip-to-trip accountability. A driver must be ‘on’ for every trip, whether that’s offering free water or gum, simply providing good conversation or knowing when to leave the passenger alone.
Perhaps best of all, if your driver is a dangerous idiot, or just not very good, you can tell Uber about it, and get them back off the road, or at least back driving taxis.
It’s no secret that taxis have come under fire for years, with numerous high-profile cases surrounding theft and assault.
Overall, Uber is considered to be the safer option, with drivers easier to track, identify and contact. However, it is not without its own controversies. A lack of accountability for driver behaviour has recently led to the company’s operating license being revoked in London, for example.
And with several sexual assault charges levelled against drivers, including in Australia, the sad reality is that neither option is entirely free of risk.
In August 2015, the ATO demanded all Uber drivers register for GST. Uber is challenging this, of course, as well as similar taxes internationally.
The ATO has also created a set of basic Uber tax rules. Money made by Uber drivers counts as income, and therefore must be reflected in a tax return. Finally, the $75,000 GST threshold does not factor into Uber taxation. Drivers earning less than the threshold must still register for GST.
While Taxi drivers are often employed by a company or fleet provider, Uber drivers are considered contractors to the company.
Uber drivers need to be over 21 and hold a valid Australian driver’s license. They must also be listed as an insured driver on the vehicle they plan to drive. Those applying to drive with Uber are also required to undergo a background check.
This continues to be a bone of contention between taxi authorities and Uber itself. What is clear is that Uber has a far more comprehensive and available list of minimum vehicle standards for consumers to consider, in that cars must:
- Be in excellent working condition, with no cosmetic damage
- Be registered and insured
- Be 10 years old or less in NSW (2007 model or newer as of 2017), eight years old in SA, and nine years old in Canberra
- Have four doors
- Be able to seat four to seven passengers, plus the driver
- Offer working windows and air conditioning
- Be able to pass a pink slip inspection
The rating system also helps ensure cleaner vehicles. If you were to find yourself in an untidy and ill-kept taxi, the best you could do is take down the plate and driver number, call the company and file a report. If you could be bothered to do all that.
With Uber, the rating system ensures the driver feels the pinch if their vehicle is not up to scratch. Users can give a low score if the car is damaged or untidy.
Well, it is a tricky one. If you’re in any way tech-savvy, it’s hard to go past the convenience of Uber. Plus, you’re likely to get a clean car, a polite driver and be assured of them taking the most direct (and cheapest) route.
Taxis, on the other hand, have lifted their game of late, and are rolling out their own apps that mirror Uber’s functionality. Still, you’ll be riding in the back of a Commodore or Falcon built when Hugh Hefner was in high school. But there’s an old school charm to that, isn’t there?
Either way, the competition is good for everyone, and especially us riders.