New Blow To Private Hire Companies As Virgin and Uber Strike Deal

Private Hire companies have been struck a new blow as Virgin, which has the West Coast franchise, announced a deal with controversial ride hailing company Uber.

The new “door-to-door” tickets will cover the cost of trains and a minicab in one fare, combining transport methods to pick up passengers from their doorsteps and drop them off at their final destination.

The companies say it would save passengers the hassle of getting themselves to and from the train station.

Passengers using the Virgin network, which is a natural monopoly, will receive text messages reminding them to book a ‘discounted taxi’ to or from the train station to complete their journey.

Virgin said the move was  a “first step towards a fully integrated and seamless booking experience” in which it is expected that entire journeys – including taxis – will be secured through new all-in-one tickets.

But Fareed Baloch of zoom.taxi said it was “a further blow to the competitive health of the industry with one natural monopoly doing a deal with a company trying to secure a monopoly of their own.”

Mr Baloch said he also wanted to know where the money from the ‘discounted fares’ will come from.

“Will Virgin be subsidising these fares? And does that mean that train passengers are subsidising fellow passengers’ taxi journeys? Or is it actually Uber drivers who will take the hit in order to increase the market dominance of the company for its billionaire investors?” he asked.

“I imagine it will be the latter because costs will still be the same, whether or not drivers are picking up from houses or train stations: these kinds of journeys are very common in the industry, after all.

“But it also means that smaller, local companies will struggle even further to stay in business particularly if they haven’t upgraded to app based technology which more and more consumers are demanding,” he added.

“And whilst customers may think that cheaper fares are better in the short term, in the long term the removal of competition from a market, using predatory pricing or otherwise, is bad news for passengers, drivers and anyone else involved in the industry.”



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