A merger of two ride-hailing services in Europe could spell more trouble for Uber as it struggles to gain market share on the continent.
Under the deal announced this week, UK-based Hailo will be absorbed by mytaxi, which is owned by Daimler, the German auto giant that is the parent company of Mercedes-Benz, among other brands.
Daimler would be 60 percent owner of the merged company, which will operate under the mytaxi name and be based in Hamburg. The companies say the new entity will offer 100,000 registered drivers in over 50 cities in nine countries in Europe — making it the largest ride-hail enterprise on the continent. Hailo operates in Britain, Ireland and Spain, while mytaxi operates in Germany, Austria, Poland, Italy, Portugal, Spain and Sweden.
The crucial difference between mytaxi and Uber — as well as other ride-hail startups that have sought to make inroads in Europe, such as Gett — is that mytaxi relies on licensed taxi drivers rather than drivers using their own cars. The app essentially serves as a means for making hailing and paying for a cab more convenient.
As such, mytaxi has not encountered the same strife that has greeted Uber across Europe, from the UK to Spain. There — as in many other countries — taxi drivers have led the opposition to Uber, pressing lawmakers to ban the company and staging protests that have at times turned violent.
Under the auspices of Daimler, one of Europe’s most venerable corporations, mytaxi has been adept at negotiating the complex regulations of the European Union, as well as those imposed by member countries.
The same can’t be said for Uber’s aggressive approach, which hasn’t played as well in Europe as it has in the United States, where the company is by far the dominant force in the ride-hailing market. Uber has faced numerous legal sanctions in Europe; two executives were arrested in Paris; it recently pulled out of Hungary after lawmakers enacted stringent laws targeting the company; and it’s currently facing a lawsuit in Britain over claims that its treatment of drivers violates employment laws.
In the merger, Daimler also brings to the table significant research and development in self-driving technology, which many observers regard as the next frontier for the ride-hailing industry. The company conducted the first successful road-test last year of a Mercedes cargo truck equipped with autonomous controls. Uber is already investing considerable sums in developing self-driving cars that could supplant human drivers.
So could the Hailo-mytaxi merger mean that the company will seek to take on Uber on its home turf? That seems unlikely based on past experience. Hailo sought to muscle into the New York City market in 2013 and barely lasted a year. And mytaxi has not expanded beyond Washington, D.C.
In the U.S., at least, people don’t seem particularly eager to hail cabs with smartphone apps — not when there are already scores of Uber and Lyft drivers trolling the streets at a given time in most cities.