Uber suffers ‘drastic decline’ in drivers and fares soar as Hong Kong crackdown takes toll

Short supply and bad weather saw one passenger charged HK$1,000 for trip from Admiralty to the airport, but many drivers afraid to log on following undercover operation that made at least 22 arrests

PUBLISHED : Thursday, 25 May, 2017, 10:03am
UPDATED : Thursday, 25 May, 2017, 10:32am

Tuesday’s police crackdown on Uber drivers has taken a toll on the ride-hailing firm’s business in the city as many drivers have stopped taking orders to avoid being arrested, the Post has learned.

Sources said Uber’s business had taken a nosedive in the two days after police arrested at least 22 drivers on suspicion of driving without hire car permits and third-party insurance in a three-week undercover operation.

However, the short supply of Uber drivers on Wednesday coupled with the impact of bad weather prompted fares for Uber trips to go up by 21/2 times as ­demand had not subsided.

“There has been a drastic decline in the number of Uber drivers going online to take orders these two days. It is understood that the drivers don’t want to take risks. Naturally, Uber’s business in Hong Kong must be affected,” a source close to Uber said. “But Uber can’t force its drivers to take orders,” the source added.

Hong Kong makes it ‘impossible’ for Uber drivers to operate legally, says lawyer in landmark case

As the firm insisted it had purchased insurance from AIG for third-party coverage worth up to HK$100 million for any ride-sharing trip in the city, the arrested drivers were given five days to deliver proof to police that they had secured third-party insurance.

Uber fares go up during high demand periods as the firm applies a surge pricing structure to ensure availability of service to those willing to pay more.

Sam Chui, who joined Uber seven months ago, said one Uber driver took a passenger from Admiralty to the airport at a fee of HK$1,000 on Wednesday.

However, he admitted that he and many Uber drivers had been deterred by Tuesday’s crackdown. “I will stop taking orders for a while to see what will happen next. Many drivers will do the same. We don’t want to take risks,” he said.

But Chui said there were still some diehard drivers who did not mind taking risks just to earn more income.

Uber Hong Kong says it has addressed third party insurance issue with at least one successful claim

Despite the crackdown, he said he actually came across many clients who were police, firemen and government flying service officers. “A former traffic police officer also told me he also wished to call Uber. But due to his position he just couldn’t take Uber rides,” he said.

The source said those who were confirmed to be undercover police would have their Uber accounts immediately blocked and blacklisted.

“Uber once considered refusing hires to those suspected to be undercover agents but after careful consideration this idea was dismissed. It is still thinking of the next step. It just hopes that the next government will be willing to discuss a way out for the firm,” the source said.

Uber Hong Kong, founded in mid-2014, has so far served one million passengers in the city using more than 30,000 drivers, with 80 per cent of them working as part-timers.