Uber allies with driver unions in bid to slow robotaxi rollout

Uber is aligning itself with drivers’ unions in a bid to slow the rollout of robotaxis, finding unlikely bedfellows as it faces fierce competition on self-driving technology from rivals such as Alphabet-owned Waymo.

The ride-hailing group that became notorious in its early years for skirting regulation and aggressively lobbying against worker protections has recently joined unions in pushing to limit the rollout of self-driving taxis in locations such as New Jersey and Washington DC.

Across the country, Uber has argued for a slower deployment of autonomous vehicles to ease the transition for drivers — and pushed for rules requiring ride-hailing platforms to have “hybrid networks” that combine self-driving cars with human drivers.

Its position marks a remarkable shift for a company once emblematic of how Silicon Valley overlooked worker protections in the name of innovation, but which now finds itself facing technological disruption of its own core business.

In a May policy paper pushing the idea, Uber noted that drivers’ earnings had dropped in Los Angeles and San Francisco where they face competition from Waymo.

Andrew Macdonald, Uber’s president, acknowledged the company’s stance might “feel ironic”.

“When Uber first launched we focused intensely on growth. We believed, correctly, that we were building something valuable, but we didn’t engage enough with the societal implications,” he said at the time the report was launched.

“In some places, we have ended up on the same side [as Uber],” said Manny Pastreich, president of 32BJ, a New-York based labour union representing drivers. “We have been as aggressive as we can . . . [and] we have at least slowed the next steps in the AV process.”

Rivals and some close to the company say Uber’s newfound focus on employment and social concerns is largely self-interested. The ride-hailing company has long pursued self-driving technology itself, but is behind its arch-rival Waymo.

Regulations enforcing a balance between human and autonomous driving would prevent pure-play self-driving companies from cutting out Uber by offering rides from their own app, as Waymo has done in several cities.

“For AVs to scale, drivers have to lose,” one former Uber executive told the FT. “Uber’s goal is to survive the transition.”

Uber chief Dara Khosrowshahi is under investor pressure to sort out its self-driving strategy after he sold off its in-house unit dedicated to the technology in 2020 for $4bn.

Khosrowshahi has spoken about the trillion-dollar opportunity from robotaxis but also maintained that the technology has yet to dent Uber’s market share.

It has since pivoted to a partnership model and committed more than $10bn to purchasing vehicles and investing in a number of AV companies. Robotaxis represent less than 0.5 per cent of Uber’s overall trip volume.

Part of Uber’s reasoning for backing multiple players is to “fragment the market” to ensure that its app still has a role aggregating rides from different taxi operators, according to the former senior executive.

On Wednesday, Khosrowshahi announced the company would cut roughly 3,300 jobs, representing about 10 per cent of its global workforce, in order to reduce management roles and redirect resources across the business.

Despite its recent stances, mistrust between Uber and labour groups runs deep. Founder Travis Kalanick built a reputation for brash disregard of local transportation rules and efforts to stamp out the entrenched position of taxi groups.

Khosrowshahi has taken a more conciliatory tone, but still faces pushback over benefits, wages and whether drivers should be classified as employees.

Still, policies that favour drivers have been boosted by Uber’s support. In New Jersey, Uber lobbyists proposed that any platform offering robotaxi services also have human drivers provide at least 85 per cent of all rides during a three-year pilot programme.

The ride-hailing app has joined unions in opposing an autonomous vehicles bill in Washington DC. Uber argues that a proposed permitting regime would lock out small competitors as well as platforms like Uber.

Uber has said that it needs to address concerns about job losses to convince lawmakers to allow self-driving cars on the road. Legislation on AVs has stalled this year in a half-dozen states, largely due to labour concerns.

“Finding compromises that meaningfully address concerns about safety, congestion and job impacts is likely the only viable path to durable policy progress that would make future deployments possible,” Harry Hatfield, Uber’s director of AI and AV policy, told the FT.

Waymo too has lobbied for measures that favour its services including pushing back against so-called hybrid networks, which it has called a “solution in search of a problem” given it operates alongside ride-hailing apps in many cities.

The Alphabet-backed start-up has also sometimes worked with labour groups, such as to secure permissions to drive to some airports.

Pastreich, the Massachusetts union leader, said drivers remained wary of Uber’s intentions, particularly as it had not put up a fight in defence of drivers in the more than 20 US states such as California, Nevada and Texas, where AVs experienced less pushback.

“Where Uber for their own strategic reason is opposing deployments, we’ll take it,” Pastreich added. “Am I going to depend on that? No. I’m not.”

Additional reporting by Michael Taffe in New York