RIDESHARING SERVICES WHICH supporters claim could spare Irish cities from gridlock are being effectively locked out of the country on the grounds of breaking taxi laws.
Transport officials have recently questioned one of the industry’s newest entrants, a carpooling app backed by entrepreneur and Dragon’s Den investor Sean O’Sullivan, on how it fits within rules that have already seen similar operators abandon the market.
But Cork-based startup Carma Carpooling claims it is only promoting the kind of ridesharing setups neighbours and colleagues have been doing for decades.
The startup, which evolved about 18 months ago out of O’Sullivan’s earlier venture Avego, is the latest to catch the eye of the National Transport Authority (NTA).
While Carma has been focussing all of its attention on the US – and primarily San Francisco – in its early stage, it is available for download and use anywhere, and has a small “cluster” of users in Cork.
Co-founder Emmett Murphy told TheJournal.ie the company had requested a meeting with NTA after receiving a letter from the government agency.
We are about driving with their neighbours and their colleagues and sharing the costs as they go to work,” he said.
Carma’s app allows people to book carpooling trips in return for a per-mile charge based on the break-even cost to US drivers. It keeps 15% of the revenue for its own operations.
No commercial rides
Last year the NTA issued a warning to German newcomer WunderCar that it would be breaking taxi licensing laws if it went ahead with plans to launch its ridesharing services in Dublin.
The company, which was already running in several European cities, bases its services on non-obligatory tipping of drivers for journeys booked through its app, but dropped its move into Ireland after the warning.
WunderCar founder Gunnar Froh said the company’s aim was to make travelling in a city easy by allowing people to instantly share transport but it didn’t “facilitate commercial rides”.
“In a few years from now, we believe that sharing a ride in the city will be just as common as it is today to take the bus,” he said.
Based on our experience, we think that innovative forms of transportation have to be piloted in other cities than Dublin, though.”
A juggernaut stopped
Recent figures from the European Commission showed Irish people favoured cars more than anyone else in the EU except for residents of Cyprus.
Ridesharing advocates argue their services help take cars off the road and clear congestion by making more efficient use of the available resources, as well as saving users money.
Meanwhile, global juggernaut Uber has also been forced to shelve the ridesharing offerings that have helped make it the world’s second most-valuable startup for its Irish operations.
Here it effectively operates as a taxi- and hire-car booking service only, absent its more-controversial features of being able to also book private cars which were not officially licensed as taxis.
Those budget options have helped Uber broker over one million rides worldwide per day, although it has also led to city bans and protests from taxi drivers complaining the startup puts them out of business.
There have also been safety concerns raised about putting passengers into cars with drivers who haven’t gone through the same vetting processes as professionals, although the companies involved have been careful to try and put those fears to bed.
In Ireland, companies found to be running illegal taxi services can be fined €50,000 while individual drivers can also be sanctioned under 2013 laws which ban people taking paying customers in their cars without the proper license.
A spokeswoman for the National Transport Authority (NTA) said it was only legal to offer carpooling or ridesharing services when there was no money changing hands.
A different mission
However Murphy said he looked at companies like Uber and its competitor Lyft as “operating in a very different space” and Carma didn’t facilitate any trips for gain.
“The big difference is their drivers are making a profit in the same way as taxi companies are. Our drivers pretty much never make a profit.
Our mission, which is very different, is to fight traffic congestion - we would love to see more people try to crack this problem.” tjb
This month, as part of TheJournal.ie’s ongoing startup and small and medium enterprise (SME) focus, we are looking at peer-to-peer services and the sharing economy.
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