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Q&A: iCabbi co-founder talks of sharp taxi industry recovery and Uber Autocab acquisition concerns
In our latest Q&A session the co-founder of taxi tech firm iCabbi, Bob Nixon, shares his thoughts with TaxiPoint. Bob discusses previous trends that could predict the trade’s COVID recovery, and talks openly about the controversial Uber and Autocab tie-up that he says could ‘decimate’ the taxi industry in 3-5 years.
How do you see the taxi and private hire industry recovering from the impact of COVID-19 once most restrictions are eased? Do you see a sharp or slow recovery?
Based on the data we have from previous lockdowns we see a sharp recovery once restrictions are eased. Over the last year as restrictions have been lifted, the taxi and private hire industry has proven to be elastic with a speedy pick up in trips. There’s one school of thought that the industry will actually grow as restrictions are lifted until people start having the confidence to use public transportation again.
How have iCabbi been impacted by the various lockdowns and measures put in place by the Government since the pandemic began? How have you supported operators using your platform?
We have of course been hugely impacted by COVID and in March we made the very difficult - but prudent and in hindsight correct - decision to trim back our team to focus on our core business. Overall, our turnover will be down around 40% in 2020 based on forecast revenues. While that sounds pretty horrific, we were in a period of rapid growth up until COVID hit and it’ll actually be a lift of c. 10% on 2019’s revenues. All in all given the year that was in we’re satisfied with the outcome.
We gave every single customer in the UK a free system for two months when the first lockdown hit, no questions asked or terms and conditions attached. This helped to give them the space they needed to adjust their finances and business model to the situation. We also quickly established a COVID-19 Task Force, providing additional product support, enabling customers to move to complete remote working, hosting helpful webinars and creating guides to help where possible.
In addition to this we operate a model where taxi/PH companies pay for active drivers, no minimum charge, so our customers pay us less in quieter times and we all benefit when they grow. As a result, during crisis periods such as COVID, their obligations to us are not at the front of their mind.
What are the big aims for iCabbi moving forwards?
iCabbi want to keep taxis relevant and at the centre of mobility. The world of mobility and transportation as a whole are rapidly changing. We see a key place for taxis within it, but change isn’t easy and taxi companies will likely need to evolve. Our technology is evolving for the new mobility paradigm that is beginning to unfold.
Based on research done to date it’s most likely that this will involve collaboration and partnership with local councils, cities and many different modes of transportation. The ultimate goal may be a Mobility as a Service (MaaS) type model that would enable a taxi company’s passengers to seamlessly travel from A to B using multiple modes of transportation such as Public Transport and micro-mobility such as Bikes, Scooters etc and of course taxis.
Where we can, we will leverage our relationship with our parent, Groupe Renault to do this. Their majority acquisition of iCabbi in 2018 was done with a view to selling more cars into the car-intensive taxi industry. Following a successful Electric Vehicle (EV) pilot in City Taxis Sheffield we are working on a plan to roll out a business model that will include EVs for our customers in the near future.
One of the big stories in 2020 was the Uber and Autocab acquisition. How do you see the partnership working and what are the key points to consider with regards to the deal?
Firstly, the proposed acquisition is not a done deal, the Competition and Markets Authority (CMA) are undertaking an investigation. I’d be surprised if the deal went through, or if it did, I’d envisage it coming with some pretty heavy conditions.
I’ve got some very direct and specific views on this deal that have led to me being accused of sour grapes and that I’m being driven by schadenfreude. It’s quite the opposite, I’d be very happy for the team at Autocab to benefit from an acquisition, both personally and professionally. I have a huge amount of respect for what they’ve done over the last 20 years, and in particular their evolution from a hardware, estate-based technology company, to a SaaS (software as a service) company like iCabbi.
However, should Uber’s acquisition of Autocab go through then I cannot see any positives for the industry. The reason I say this is because I can’t understand the logic behind the deal as it’s been communicated by Autocab.
I've said it many times, I could understand Uber wanting to partner with the whole private hire and taxi industry as an aggregator. I'm not clear how the industry would feel about it, but I could understand why Uber might take this approach. I wrote on LinkedIn as far back as 3-4 years ago that I couldn’t understand why Uber wasn't following an aggregator approach in Europe instead of fighting regulators and cities every step of the way. Driver and market acquisition is so expensive that it seems like a logical model to me, particularly now given the current Uber CEO experience with aggregator models in previous roles he has held.
Uber and Autocab have stated that the proposed acquisition is a way for them to partner with the UK’s taxi and private hire industry. Really? I can't see any need for Uber to buy a dispatch tech provider to do this except where they have an eye on a bigger prize, for example visibility of data and ultimately control of the entire UK taxi and private hire market.
If the deal goes ahead, my personal opinion is the traditional taxi and private hire industry will be decimated in 3-5 years. This would see consumers in many areas being left in a monopoly type situation with a single large provider who controls prices and has no local presence or community relations. I may be right, I may not, but one thing is for sure, you can't put the toothpaste back in the tube and do providers really want to take the risk and find out?
I'm all for change, but the ever-growing dominance of large tech companies at the cost of traditional businesses and suppliers is really worrying. It’s interesting to note the ongoing calls in many countries for the break-up of these tech companies and as such there is perhaps already a growing movement against it.
The taxi and private hire industry was making good strides in its move towards greener fleets before the pandemic struck. How important is it for the industry to get back on track and what more can be done to accelerate the move to Zero-Emissions Capable (ZEC)?
I believe that it’s critical and that it’s going to take collaboration and partnership across a wide range of stakeholders to really make some progress. That includes the national Government, local cities/ councils, OEMs such as Renault, and the taxi companies themselves. Grants and support for EV charging infrastructure is going to be critical, as are incentives for the acquisition and initial set up for Electric Vehicles (e.g. home charging stations). We all also need to look at this from a different perspective to the traditional models and come up with some innovative business models that can propel us to a fully electric future.
