Ride-Hailing Services in Germany: From Allygator to Uber

Is the Uber ride-hailing service available in Germany? The German answer to that question is jein – yes and no. Although Uber is completely banned in several European countries, it’s not entirely missing in action in Germany. Uber currently operates in only seven German cities. (See below for recent court rulings and possible changes.) But the familiar UberPop ride-app service that many Americans are used to does not exist in Germany. In Germany, Uber has to use existing taxi operators and rental car services for its service. If you want to drive for Uber in Germany, you need to have a professional chauffeur’s license (Personenbeförderungsschein), not just a normal German driving license (Führerschein).

How can that be?

Traditional taxis at Berlin’s Tegel (TXL) airport. PHOTO: Wikimedia Commons

Almost from the start, in early 2014, Uber faced major roadblocks in Germany. At first the ride-sharing pioneer went with an American approach – trying to bulldoze its way through German regulations, laws, culture and traditions. It did not go well.

Uber’s co-founder and then CEO, Travis Kalanick, thought he could simply use the same gonzo strategy in Germany that Uber had used at home and in other places as the company expanded beyond the United States. Founded as UberCab in San Francisco in 2009, the company now known as Uber Technologies Inc. operates in 633 cities worldwide.* In the process, Uber has learned that it can’t always get its way, especially in Europe.

Under Kalanick, Uber developed an aggressive expansion technique called “principled confrontation” in which Uber simply began operating in a city or region until being told that it didn’t have permission to do so. At that point the firm would mobilize public support for its service, using an array of lobbyists, followed by a political campaign to change the local regulations. It’s a method that worked in large and small communities, but not everywhere – even in the USA and Canada.

UberTaxi in Berlin – “In classic colors through the city.” From the Uber website. PHOTO: Uber

Enter Dara Khosrowshahi and a Softer Approach
Kalanick’s cocky, confrontational leadership style eventually led to headlines like “Everybody Hates Uber: Regulations, Outraged Taxi Drivers, and In-house Scandals That Ruin Their Business” and the hashtag #deleteUber. As it expanded abroad, Uber began to face resistance in places where freewheeling capitalism and “disruptive technology” were not necessarily viewed as positive things. Particularly in the European Union, Uber encountered strong opposition to its app-based ridesharing model, under which anybody with a driving license and a car could drive people around town and earn extra income. The EU has no legal provisions for freelance drivers with their own vehicle, or for a “transportation network company” (TNC) that claimed it was an information service, and its drivers were independent contractors, not employees.

UberX and UberTaxi in Germany
Both ordered via the Uber app
UberX | Rental cars driven by certified drivers who hold a chauffeur’s license
UberTaxi | Regular taxi cabs driven by licensed cab drivers

In December 2017 the European Court of Justice ruled that Uber was a transport company, subject to local transport regulation in European Union member states, not an information service. That, added to growing criticism of Uber’s über-male corporate culture, the failure to break through in big markets (China, London), 2016’s serious data breach, and EU intransigence, led to Kalanick stepping down as Uber’s CEO in early 2018. His replacement was Dara Khosrowshahi, formerly with Expedia for 12 years. One of Khosrowshahi’s first moves was to apologize for Uber’s past confrontational approach. His softer touch has allowed Uber to make progress, but not without limitations. The head of Uber’s European division, Pierre-Dimitri Gore-Cotry, has said: “We agree with the objectives of the German regulations, but Germany still has laws and regulations that date back to the 1960s.”

In Germany and the EU in general, this means that Uber can operate only with certified taxi drivers and vehicles. Uber in Germany offers only its UberBlack limo service (“the original Uber”) and UberX/UberTaxi taxi service. Facing a total loss of its license, Uber agreed to the same restrictions in Barcelona and London. Under Khosrowshahi, Uber continues to operate in Germany and the EU only as a taxi service. The US-style UberPop freelance ride service can’t be found anywhere in the EU.

“Uber moves Munich.” An Uber website screen shot with a map indicating the service area in the Munich metro region. Also available in English. PHOTO: Uber

Legal Hurdles and Regulatory Roadblocks Facing Uber in Germany

When Uber entered the European (EU) market, it encountered a far more complex array of laws and regulations than it ever saw in the US, as well as a radically different business and government culture. Here are some of the main obstacles Uber faces in Germany and the European Union:

• German Competition | Although Lyft, Curb, and other US competitors have avoided Germany so far, even before the arrival of Uber in Germany there were German firms offering non-traditional, licensed taxi service via an app. Mytaxi, Taxi.de, and Allygator Shuttle are UberTaxi-like firms that allow you to order a taxi via an app, see the fare, the taxi number, the driver’s name and phone number, and pay without cash (still a rarity in Germany) – all without using a traditional telephone cab dispatch. Even UberX drivers have to have a chauffeur’s license. Not only does UberTaxi compete with its German app-oriented imitators, it also has to compete, like they do, with Germany’s long-entrenched traditional cab companies. For more about Uber’s competition in Germany, see below.
• Taxi Deutschland | This national cooperative represents many private taxi companies spread across Germany. It wasted no time filing law suits and injunctions against Uber, doing so almost immediately after Uber arrived in 2014. It and other German taxi organizations have gone up against the upstart from California, winning local and national court rulings against Uber.
• Regulations and Licensing Requirements | From the start in Germany, Uber faced a big problem caused by a German law abbreviated PBefG (for Personenbeförderungsgesetz). This law regulating the commercial transport of passengers (taxis, limousines, vans, etc.) requires anyone conveying paying passengers to have a chauffeur’s license. Without a change in this law, Uber’s basic ridesharing concept of matching a passenger with a private, uncertified driver falls apart. Although many localities in North America have been willing to change similar taxi laws, Germany has strongly resisted any such revisions, locally, nationwide or EU-wide.
• Insurance (auto liability coverage, Kfz-Haftpflichtversicherung) | Although Uber required UberPop drivers to have liability insurance coverage on their private vehicles, German insurance law allows insurance companies to drop such coverage or not pay for damages if it turns out a driver lied about the amount of “personal/private” mileage versus “business/paid” mileage. This untenable situation for Uber and drivers without a chauffeur’s license was another reason UberPop service ceased in Germany. For its certified “partner” drivers in Germany, Uber began offering free medical/liability insurance protection in June 2018 in partnership with AXA.
• Taxes | The old saying about “death and taxes” proved prophetic for Uber in Germany, a country with a bewildering array of taxes at eye-popping rates. This affected both the company and its drivers.

Uber in Germany Today

At one time Uber was operating in six German cities: Berlin, Cologne (Köln), Düsseldorf, Frankfurt am Main, Hamburg, and Munich (München). Although Uber’s German website still optimistically lists all of those cities, the truth is that following numerous legal battles and court decisions, Uber now offers UberTaxi/UberX service in just two German metro areas: Berlin and Munich. In order to do even that, Uber has dropped any attempt to offer the UberPop service found in the United States.

Another problem or criticism that Uber has faced in Germany (and elsewhere) concerns surge pricing, also known as “dynamic pricing” or “demand-based pricing.” (Lyft calls it Prime Time.) This is an Uber practice that increases the ride fare based on demand. When demand is normal, Uber charges a standard fare. But if there is heavy demand due to rush hour, a special event, a holiday, or some other reason, Uber and Lyft temporarily raise the fare by as much as a factor of 3. They justify the practice with the claim that it helps balance supply and demand. The practice even led to an app called Surge Protector that claims to help users avoid surge pricing.

“We agree with the objectives of the German regulations, but Germany still has laws and regulations that date back to the 1960s.”
– Pierre-Dimitri Gore-Cotry, head of Uber’s European division

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Surge pricing (Aufschlag zu Stoßzeiten, “peak time surcharge”) is unpopular everywhere (except with drivers), but in Germany it tends to be viewed as raw price gouging. But even though Uber was forced to drop UberPop and use only certified, transport-licensed drivers for UberX and UberTaxi, they still have surge pricing in Germany. This means that any time there is peak demand (holidays, New Year’s, Oktoberfest, etc.) in Germany, it may be cheaper to take a normal taxi rather than use Uber.

Berlin
In the German capital, Uber offers the following services: UberX, UberTaxi, and UberTaxi Van. Web: Uber in Berlin (in English). Following a successful pilot run in Munich, Uber has indicated that it plans to introduce its UberGreen e-car service in Berlin “in the fall” of 2018. Prior to Munich, the UberGreen service had launched in London, Paris, and Zurich. (UberGreen has its own section in the Uber app for Germany.)

Munich (München)
In the Bavarian capital, Uber offers a few more services than in Berlin. UberBlack (limousine), UberX, UberVan, and UberGreen (electric vehicles) are all found in Munich. Until now, UberGreen has been exclusively in Munich, but, as mentioned above, Uber has plans to expand this eco-friendly service to Berlin. Web: Uber in Munich (in English).

Uber featured this odd moss-covered electric car in its advance publicity for UberGreen in Germany. PHOTO: Uber

Under its new CEO, Uber has plans to expand in Germany beyond ride-hailing. It wants to introduce app-based electric bright red Jump bikes in Germany. (Uber recently bought Jump.) That may be a good idea, but Uber would also face heavy competition in that area from existing German-based companies and US-based LimeBike. Not only that, but Berlin in particular is a dangerous place for cyclists, with a high accident rate caused in part by bike lanes with little separation between motor vehicles and bike riders (or no bike lane at all), a situation that more bikes would only worsen. Jump’s dockless electric bikes are already found in San Francisco and Washington, DC. An indication that Uber still has work to do in Germany: When CEO Dara Khosrowshahi made the Jump bike announcement at a conference in Berlin, dozens of German taxi drivers were outside waving placards that read “Uber go Home.”

An allygator shuttle drives across Berlin’s Oberbaumbrücke. PHOTO: allygator shuttle

Austria and Switzerland
Uber also operates in the neighboring German-speaking countries of Austria and Switzerland, but under the same restrictions it has in Germany. In Austria, Uber is only in the capital city of Vienna (UberX). In Switzerland, Uber can be found in Basel (UberX) and Zurich (UberX and UberGreen). UberX is also in the French-speaking Swiss cities of Geneva and Lausanne.

Uber’s Competition in Germany

Other German taxi apps offer Uber-like services all across Germany. Like UberX and UberTaxi, they may not offer a big price advantage, but they offer the convenience of an app. Here’s a brief summary of competing taxi apps in Germany:

• mytaxi (Daimler Mobility Services GmbH) Android, iPhone, Blackberry 10
  Available in more than 40 German cities. “10 million users, 100,000 taxis.” Possibly the best German taxi app, Hamburg-based mytaxi’s one disadvantage is that it does not use regular taxi dispatch centers, resulting in less coverage than most other taxi apps. But in larger German cities this is not a problem, and the average wait time is 4.6 minutes. Features: Fare preview, taxi arrival info, in-app electronic payment, driver ratings, taxi sharing. Partners with Miles & More (Lufthansa, United points). English language option. Also available in other European countries and in Washington, DC.
• BetterTaxi | Android, iPhone, Web browser
  Germany-wide coverage. Airport transfers in some cities (Berlin, Frankfurt, Munich, London, Rome). Features: Fare preview, in-app electronic payment. Also available in some other European countries. Info also in English.
• allygator shuttle | Android, iPhone
  Currently available only in Berlin, the allygator shuttle app allows users to share a van – for much less than a normal taxi. App features: Fare preview, pickup location/time with van license number and driver’s name. Cash or credit card payment before your ride begins (“wie im Bus,” as in a city bus). Allygator charges a flat 5 eurocents per kilometer. Requires an advance registration code in order to set up a user account. (See the app or website for details.) No pets or large luggage allowed.
• Taxi Deutschland | Android, iPhone
  All towns and cities of 5,000 population or more. Features: Fare preview. Cashless in-app payment only in some cities.
• Taxi.de | Android, iPhone, Web browser
  All towns and cities of 60,000 population or more. Features: Fare preview. Some drivers may offer credit card payment with a card reader.
• Taxi.eu | Android, iPhone, Web browser
  Available in more than 50 German cities. Features: Fare preview. Cashless in-app payment only in some cities (PayPal, credit card). Also available in some other European countries.

Have you used UberX, UberBlack, UberGreen, or any Uber service in Germany? We’d like to hear about your experience with Uber or any of its rivals (allygator, BetterTaxi, mytaxi, etc.). Please leave a comment below or on our Facebook page.

– HF

*Cities as of August 2018, according to the Uber Germany website.