New B.C. barriers could easily scare off ride-hailing firms

Transportation Minister Claire Trevena has finally set the wheels in motion that could bring ride-hailing services to B.C. by this fall.

It is not entirely clear yet, however, whether any company will enter the B.C. market - given the barriers being put into place.

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One of those barriers may be Trevena’s insistence that drivers hold class four driver’s licences, which are more specialized.

Trevena outlined her resistance to drivers holding the standard class 5 licence in a letter sent last week to Passenger Transportation Board chair Catherine Read.

“I am a firm believer in safety and believe that a commercial class 4 driver licence provides a safer atmosphere for passenger-directed vehicle movements, with extra testing and a medical examination completed at time of application and in routine intervals thereafter,” she wrote.

Lyft has publicly said requiring a class 4 licence for drivers is a deal-breaker for them, although a company representative appeared to be hedging his comments after Trevena’s letter was made public.

Safety concerns aside, I have long thought the NDP government’s reluctance to fully embrace ride hailing is grounded in the industry representing a rather free-market model, with minimum regulations and freedom to go wherever it wants.

While the existing taxi industry’s political influence cannot be discounted, the NDP’s core philosophy is that government knows best, at least better than an open market.

It remains to be seen whether geographic boundaries governing ride hailing will be included in the final package, or what the fare structure is going to look like. I would not bet the farm on everything being wide open.

Another factor that may keep ride hailing at bay in B.C. that Lyft and Uber have lost tremendous amounts of money and show no signs of turning a profit anytime soon.

This begs the question of whether fares must increase, or drivers’ wages must go down in order for these companies to stay afloat. Again, why should anyone by surprised by the NDP’s hesitation to embrace an open market industry that will potentially pay its workers low wages?

The weight of these fiscal challenges may be enough to give these companies reason to reconsider expansion into untested jurisdictions like B.C.

Over time, another form of transportation service may increasingly meet the demands of consumers not satisfied with traditional taxi service and therefore serve as another obstacle to ride hailing taking firm root in B.C.

That would services offered by such companies as Modo, Evo and car2go in Metro Vancouver and some other parts of the province. These companies are gradually increasing the size of their fleets and are relatively cheap (certainly cheaper in most cases than a rental car) to use.

I suppose that Uber may eventually dip its toe into the B.C. market, but there remains a good chance it may not find the water to its liking.

Keith Baldrey is chief political reporter for Global BC.

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