Uber Warns of Price Hikes, Longer Wait Times After Toronto’s Cap on Ride-Share Licences

A screen displays the company logo of Uber Technologies Inc. on the day of its IPO at the New York Stock Exchange (NYSE) in New York on May 10, 2019. (Brendan McDermid/Reuters)

Uber expressed dissatisfaction with Toronto City Council’s recent decision to impose a temporary freeze on new ride-share licences for up to one year. The company cautioned that the move could lead to increased prices and extended waiting times for customers.

“Mayor [Olivia] Chow’s cap will ultimately hurt the diverse group of Torontonians who rely on rideshare as part of their transportation mix and those who drive rideshare for additional income, especially in a time of rising costs,” Uber Canada said in a statement on Oct. 11.

“There was no procedural fairness on the council floor today.”

On Oct. 11, the city council voted 16–7 in favour of a motion introduced by councillor Mike Colle. As a result, there will be a temporary suspension in the issuance of new licences for ride-share and private transportation companies, with the aim to address greenhouse gas emissions, traffic congestion, and transit-related challenges.

Andrew Macdonald, senior vice president of mobility and business operations at Uber, called the decision a “misguided policy.”

“Restricting supply of something that consumers need badly (in this case, reliable, safe, affordable transportation) is not good for the city,” he wrote in a post on the social media platform X.

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In addition, he said the restriction hinders Canadians’ opportunities to make earnings amid an affordability crisis, particularly for new immigrants who have just arrived in Canada.

Ride-share company Lyft echoed this perspective.

“While Lyft supports electrifying our industry, instituting a licensing cap without any research into its implications is counterproductive and will do little to improve congestion downtown,” Lyft said in an emailed statement to The Epoch Times.

The Toronto Region Board of Trade (TRBOT), an organization representing more than 11,500 business leaders in the Toronto area, also released a statement in which it expressed disapproval of the council’s limitation on ride-share licences.

“The Toronto Region Board of Trade is disappointed to see this policy implemented without consultation, any discussion with the business community, or even having the benefit of the forthcoming staff report on ride sharing due late next year,” it stated.

TRBOT noted that the number of ride-share drivers in Toronto has already decreased substantially in recent years, dwindling from 91,000 in 2019 to 52,000 at present. It underscored the pressing need to address congestion, but also noted that ride-sharing makes up just 3 percent of Toronto’s overall traffic congestion. Additionally, it said that this industry contributes about 1.3 percent to 2 percent of the city’s total emissions.

The company also noted that with ride-share demands on the rise following the COVID-19 pandemic, imposing a licensing cap at the present levels is expected to result in higher passenger fares and increased waiting times. Additionally, it would encourage drivers to concentrate in the busiest areas of the city, exacerbating congestion and reducing transportation options for residents living outside the city centre.

Meanwhile, Mayor Chow voiced support for Mr. Colle’s motion, saying it would increase the income of app-based workers by reducing competition and mitigating pollution. She justified the motion’s rapid adoption, saying that a prior announcement of the cap might have triggered a surge in licence applications.