Uber's Audacious Ultimatum to a Major US City for Having Regulations It Doesn't Like

Uber is threatening to yank its services from San Antonio if the city fails to repeal a city ordinance, in what could become a defining battle of the Sharing Economy.

In a recent statement, officials from the rideshare company took aim at San Antonio’s “anti-competitive provisions” which require drivers to jump through “municipal hoops.” That statement concludes with a cryptic threat: “Without a full repeal, we will be forced to leave town.”

This isn’t the first time Uber has threatened to leave San Antonio. After the city council voted for new regulations in December (which included background checks for drivers and third-party car inspections), Uber’s general manager for Texas wrote a letter to the chairwoman of the council’s Public Safety Committee, informing her that Uber couldn’t work under such conditions.

“After much consideration, it is clear that these regulations will cripple Uber’s ability to serve drivers and riders in San Antonio,” Nakutis wrote. “A vote in support of these regulations was a vote against ride-sharing, and if the rules remain unchanged, Uber will have no choice but to leave San Antonio.”

San Antonio Mayor Ivy Taylor was initially supportive of the new measures, but she’s recently backtracked, delaying the ordinance from kicking in. Taylor identifies some of the new insurance rules as the reason for the delay, explaining lacks the necessary products to provide drivers with the required coverage. However, her statement also acknowledged that Uber’s rhetoric had a direct impact on her decision: “Given the concern from the general public, [transportation network company] drivers, and [transportation network companies] we have expedited the initial review and are conducting it now.”

City Council is scheduled to meet this week to, presumably, rework the regulation in a way that keeps Uber around. However, if the ridiculously lucrative company can bail on cities for passing ordinances it disagrees with, its impact on future debates seems to be solidified.  

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