Uber’s start driven by numbers out of Belleville, Edwardsville

By DENNIS GRUBAUGH

    Belleville and Edwardsville residents have led the charge since the debut of the Uber ride-sharing service in Southwestern Illinois.
    “I think that’s where there’s the most density in terms of area and population. That’s where we’re going to see, at least at the start, the most response. We’re doing more rides every day and we’ve got a bunch of cars on the road,” said Sagar Shah, Uber general manager overseeing Metro East operations.
    The whole arena of on-demand transportation is a relatively new phenomena that will take local marketing for most people to get accustomed, he said.  The service allows potential passengers to arrange ridesharing with private-vehicle drivers by use of an Uber ap on their mobile phone.
    The service launched in mid-April with its lower-cost version, known as UberX. State Sen. William Haine, D-Alton, and his wife Anna were two of the first passengers, as was Edwardsville Mayor Hal Patton, with photo op ceremonies conducted of each.
    Shah was asked if he thought the service would skew mainly to younger people because of their better grasp of technology.
    “I don’t think it’s going to be older vs. younger. I think it’s going to be the ones who are more in tune with the technology, as well as who are looking to not drive their own car — whether that be getting a safe ride home at night or generally wanting to get around in a more immediate way without having to look for parking and so forth.”
    The Illinois Legislature last year passed a bill eventually signed on his last day in office by Gov. Pat Quinn, regulating the ridesharing industry. It created a framework for transportation network companies (or TNCs) to operate within the state of Illinois.
    After it debuted in Alton, city officials expressed concern how such ridesharing would impact standard taxi service, but Shah said he does not see ridesharing as detrimental to other businesses.
     “This is a new industry. There’s never been a way to call a car from your smartphone. It’s a new technology and people have to get adjusted to it, and we are actually seeing a lot of taxis compete in this realm as well and create their own smartphone aps, so you can call a taxi as well. We’re actually starting to hear in some cities where taxis are starting to create a better, more reliable service in order to keep up with the TNCs.”
    He thinks competition will raise the bar for everyone.
    “We’ve seen more people take trips via ride sharing than ever took trips via taxi. So, we’re not really taking away a piece of the pie, we’re growing the pie,” Shah said.
    Uber has been trying to get a foothold in the St. Louis market for about a year now. It has been successful at launching Uber Black, a high-end limo service, but the regulatory framework is not yet in place for regular ridesharing in Missouri.
    Uber launched in Illinois in Chicago a few years ago. Springfield, Rockford and Champaign-Urbana followed, and Metro East was the latest.
    “What we’ve heard in places like Edwardsville is that existing transportation options such as taxi are really nonexistent. That means that a lot of people rely on driving themselves whether that being during the day or late at night. We just want to provide safety on the road and provide reliable and quick rides for people.
    Uber has been criticized in some markets for driver assaults and other crimes against passengers, but the company has taken a number of measures to step up safety. A potential driver’s application process starts when a party goes to partners.uber.com and signs up. In order to become a driver, one must undergo a five-step background check.
    “We look at your motor vehicle record and we conduct a county and multistate federal background check and we also scan the national sex offender registries. That takes about seven to 10 days to complete,” Shah said. “After that we make sure your vehicle is at the most 10 years old. And that your name is provided on insurance with the vehicle as well. After that we provide training, and instructional videos and you’re more or less able to come ride with us at that point,” Shah said.
    The system is cashless. A rider will register his credit card and the driver his bank account. Uber takes a 20 percent fee, and the driver will keep the other 80 percent.
    Fee structure is based on distance and time. It costs the rider:
    – $1.75 simply to get into the car
    – 25 cents per minute and
    – $1.50 per mile.
    – $1 for a “safe rides” fee
    The minimum fare is $5. There is also a $5 cancellation fee.
    Because riders’ credit cards will be on file, there will be no stiffing the driver for a fare. The entire approach is safer.
    “If you’re a taxi driver, it’s a dangerous job, carrying hundreds of dollars in cash with you at all times. And you’re not sure at the end of the day if (your fare) is even going to pay you,” Shah said.
    Within weeks of starting in Metro East, Uber already has “dozens of drivers on the road,” Shah said. “A large portion are around Edwardsville, and again we expect that to grow.”
    Uber has numerical goals for the market, but nothing that it is willing to disclose at this point. It has been using promotional events, like free rides to first-time drivers, to help bolster the count, he said.
    Shah, who is from Chicago, heads up a team that is dedicated to Uber in Metro East and St. Louis. He recently got his MBA at the University of Chicago and started with Uber about nine months ago.
    “It’s been a great ride,” he said.