‘Flywheel’ Sues Uber for Monopolistic Tactics
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The latest legal action against Uber comes from Flywheel, a ride-hailing upstart that evolved out of DeSoto, which is the oldest continually operating taxi company in San Francisco. Flywheel’s stated intention is to galvanize the floundering cab industry and present a united front against Uber by working with multiple taxi companies.
“I see taxis right now as a single brand. You have Uber, you have Lyft, and you have taxis,” said Mark Gruberg of the San Francisco Taxi Workers Alliance to The Daily Dot. But things haven’t gone too well for the startup, Flywheel says, due to Uber’s unfair business practices. According to the complaint, Uber controls a commanding 70% of San Francisco’s ride-hailing market whereas taxi companies have seen their ridership decline by 65% and lost over 30% of its drivers.
Mincing no words, the lawsuit accuses Uber of engaging in anti-competitive and monopolistic practices, arguing that its tactic of subsidizing rides to slash prices is “predatory” and meant to drive other services out of business.
“Uber has done little more than implement a business strategy that openly flouts the law while shifting many of the costs and nearly all of the risks of providing ride-hail services from itself to its drivers and passengers while forcing a race to the bottom through predatory pricing tactics”, Flywheel said. Uber can afford to do this, the suit argues, thanks to its multi-billion dollar war chest of venture funding.
In response, Uber is arguing that its end goal is not to destroy the competition per se, but to end personal car ownership by providing a cheap and viable alternative. “Our goal is to provide a credible alternative to the private car,” an Uber spokesperson said. “Our technology lets us make our network more efficient over time, and innovations like UberPool are further lowering prices, making ridesharing more available to more people.”
