Uber C.E.O. Aims to Win Back London

In the meantime, the ruling has highlighted divisions within the city.

Critics are led chiefly by London’s black cabdrivers. They must earn their licenses by memorizing 100,000 landmarks across 25,000 streets in London, an extremely difficult test known as The Knowledge. They argue Uber drivers are under-regulated and that the service systematically underprices competitors to win over customers.

How Uber’s Brash Approach Backfired

A series of scandals have toppled executives, including Travis Kalanick, Uber’s co-founder.


“Their entire business model is based on predatory pricing,” said Steve McNamara of the powerful Licensed Taxi Drivers’ Association, which represents the British capital’s centuries-old black cab sector. “Uber wants to undercut competitors, establish a monopoly and then raise prices when they have a monopoly.”

Supporters of Uber, however, are plentiful. The company has garnered nearly 850,000 signatures for a Change.org petition called “Save Your Uber in London.” Proponents argue satellite navigation has rendered the Knowledge obsolete, that black cabs are too expensive, and that Uber’s detailed tracking of drivers enhances passenger safety.

That most black cabdrivers are white, native-born, Britons and many Uber drivers are immigrants serves only to complicate matters.

Meetings between Uber and Transport for London have long been controversial affairs.

Under Mr. Kalanick, Uber responded to regulators’ concerns by mobilizing consumers to drown them out and by lobbying politicians at the highest level.

When the previous mayor of London, Boris Johnson, tried to clamp down on Uber two years ago, the Conservative politician was told to stand down by the prime minister at the time, David Cameron, and his chancellor of the Exchequer, George Osborne, also Conservatives.

One of Mr. Cameron’s senior advisers at the time, Steve Hilton, is married to Rachel Whetstone, then head of communications for Uber. The couple are godparents to one of Mr. Cameron’s children. The meetings often took place at 10 Downing Street and were chaired by Daniel Korski, Mr. Cameron’s technology adviser.

If there have been changes at the highest level at Uber, the dynamics in London have changed, too. The new mayor, Sadiq Khan, is a member of the opposition Labour Party and not beholden to the Conservative government of Prime Minister Theresa May, Mr. Cameron’s successor.

Photo

Mr. Khosrowshahi in July.

Credit
Rob Latour/REX, via Associated Press Images

For Uber, the London ban is but one of several headaches around the world that the company’s leadership must confront.

While Mr. Khosrowshahi is on his diplomacy mission, Uber’s board is scheduled to discuss proposals that would limit Mr. Kalanick’s power. That meeting will include two new directors named by Mr. Kalanick late last week, a surprise move that escalated tensions with other board members.

The proposals are tentatively linked to a pending $10 billion investment in the company from a group led by SoftBank of Japan, a potential deal that Uber’s board has worked on for weeks.

It is a sign of importance of the London ban that, even with Uber’s board meeting set to take place, Mr. Khosrowshahi has flown to meet with authorities here. With 40,000 drivers and 3.5 million customers, the city is Uber’s biggest market in Europe, and one of its largest in the world.

“London is the Champions League of Transportation,” Mr. Kalanick told the British newspaper City A.M. three years ago. “It has got a more dynamic, more competitive transportation system than any other city in the world.”

The effort on Tuesday is meant to show that Uber is adopting a more conciliatory approach to working with cities. Such a change in attitude is important as Uber continues to expand globally and justify its sky-high $68.5 billion valuation ahead of an initial public offering that Mr. Khosrowshahi has said could come in 2019.

There are plenty of challenges, though.

The company’s most senior executive based here, Jo Bertram, recently resigned.

And elsewhere, the ride-hailing service has continued to face pressure from both governments and competitors. The company gave up its ambitions to expand in China last year when it sold its operations there to a venture run by Didi Chuxing, a homegrown rival. Uber also sold its Russian business this summer to a new joint venture run by its main competitor in that country, Yandex.

Continue reading the main story