Uber just might have to significantly open up its wallet if it will want to continue doing business in the UK’s capital. Transport for London (TfL) wants to get rid of the current two-tier system and replace it with a new five-level structure.
Under the current regulations, private hire operators that have a maximum of two vehicles have to pay £1,488 to get a five-year license. Bigger companies that have three or more vehicles have to fork out £2,826 to get the license.
The new system proposed would introduce three new categories, with the highest one being for companies with over 1,000 vehicles. Uber would definitely fall into this category, as it has over 30,000 drivers in London and would have to choose between two different structures. It could either opt for paying £33,304 per year and £14 per registered vehicle or £166,518 plus £68 per vehicle to get a five-year license.
What this actually means is that Uber, with its 30,000 cars, would have to pay more than £2 million to secure a license for a period of five years. As already mentioned, the company has been paying £2,826 so far for the same deal.
So, what exactly is the reason for the massive price hike? Well, TfL claims that the private hire industry in the city has grown a lot over the last few years. Back in 2013/14, there were 65,000 licensed drivers in London compared to more than 117,000 now. The cost of regulating the industry has been significantly increasing, which is why a new system is apparently needed.
Uber hasn’t commented on this topic yet, but I think it’s safe to assume that the company isn’t very happy with the new proposal.