In what has become a familiar move for Uber, the vehicle-for-hire company announced Wednesday it will cease operations in Corpus Christi, pointing to “unnecessary” regulations recently adopted by the city.
Corpus Christi’s City Council approved new regulations this week that would require app-based vehicle-for-hire drivers to undergo a fingerprint background check, a requirement Uber has resisted in most markets. The company plans to end services in Corpus Christi on Sunday, two hours before the new law goes into affect, according to the Corpus Christi Caller Times.
“The proposed ordinance would require drivers to complete unnecessary and duplicative steps that make it difficult for them to earn extra money and hurt our ability to ensure that riders have access to reliable and affordable transportation,” Sarfraz Maredia, Uber’s general manager in South and East Texas, wrote in a letter to Corpus Christi’s city council on March 4.
Corpus Christi will be the third city Uber has left this year in response to local laws. In February, the company ceased operations in Galveston and Midland after the cities voted to enact background-check requirements.
Despite Uber’s disdain for mandatory fingerprint-based background checks, the company has continued to operate in Houston, where drivers are required to undergo those background checks.
Corpus Christi Mayor Nelda Martinez said she feels Uber is more lax when it comes to accepting regulations in larger cities. Houston is Texas’ largest city with over 2 million residents. Corpus Christi, with a population of around 316,000, is the eighth largest city in Texas.
“It is unfortunate that they believe that comprehensive background checks with fingerprints and safety in smaller cities are less important,” she said Wednesday. “We have been working with them since the fall of 2014 and what makes me most sad about them leaving Corpus Christi is that they are leaving loyal customers and drivers who depend on them.”
Martinez said she would welcome the company back in the future, but would “absolutely not” consider softening the ordinance.
So the pattern is pretty clear here – your city can have fingerprint checks, or it can have Uber, but not both. Unless your city is Houston, apparently. But how long will that be the case? With that in mind, I sent the following questions to Uber spokesperson Debbee Hancock:
1. Is it now Uber’s policy to no longer operate in cities that require fingerprint checks?
2. Does this mean that Uber plans to pull out of Houston? if not, then how does Uber respond to Corpus Mayor Martinez’s statement that “Uber is more lax when it comes to accepting regulations in larger cities”?
And the answers I received:
We know from our experience in Houston that these rules can have a devastating impact on our ability to provide the experience that drivers and riders have come to love and expect. Since then, we have made the difficult decision to cease operations in every city that has adopted new laws that require similarly duplicative regulations on drivers.
We have also made a major shift in our expansion strategy. At the beginning of 2014, the only people in Texas that had access to Uber were the people of Dallas. With a goal of making transportation as reliable as running water, we rapidly expanded our operations across the state. Today, millions of Texans in more than a dozen cities can open the app to request a ride.
Most cities have rapidly embraced this innovative transportation option. In fact, multiple cities where we did not already operate, such as San Marcos and Beaumont, invited us to launch by proactively adopting pro-ridesharing regulations. We have limited our expansion plan to cities that adopt similar regulations as Beaumont, San Marcos, College Station, and Abilene.
We have been monitoring the impact these regulations are having on riders and drivers, and we’re concerned by the trends we see (barriers to entry for drivers, longer wait times, fewer available rides late at night when people need it most , etc.). It is no surprise that these regulations don’t work for ridesharing since they were designed for the taxicab industry long before this technology existed. It is our hope that we can work with the City to modernize the process so we can continue to operate in Houston.
So there you have it. I’m just speculating here, but if the Austin rideshare referendum passes, I won’t be surprised if we see some action in Houston afterward.