UPDATE 10/26 1:50 p.m.: The Philadelphia Parking Authority has impounded UberX vehicles through an undercover sting operation. For the full report, go here.
On Friday afternoon, the scads of Uber customers in the Philadelphia area received an email announcing the arrival of UberX, the company’s lower-cost alternative, within city limits. The company explained that it had decided to thrust UberX upon the city due to a convoluted situation that may have left hundreds of Philadelphia taxicabs without the insurance they need to operate.
Here’s what Uber wrote in the email blast:
This week, the largest taxi insurer in Pennsylvania went bankrupt, which means that as of 5:00pm today, there is no guarantee that your taxi ride will be insured. To make sure that you can get safe and affordable rides around Philadelphia this weekend, we have decided to launch uberX.
What is uberX? uberX is our low-cost option, with prices at least 20% cheaper than a taxi. uberX driver partners have mid-range or hybrid vehicles with seating for up to four passengers. Every uberX driver partner is backed by our $1M insurance policy, 28x more than required for Philly taxis, and must pass comprehensive county, federal, and multi-state background checks that go back seven years, which are more stringent than what is required for taxis.
With your help, we hope to find a permanent home for ridesharing in Philly, just like in 110 other cities across the country.
The message went on to explain that UberX would be free all weekend — up to three trips at a maximum of $20 each.
It’s important to understand the distinction between Uber and UberX. Uber is a luxury-car-service app, matching black sedans and SUVs piloted by licensed limousine drivers. It’s a premium service that can cost significantly more than a taxicab, especially when its controversial “surge pricing” is in effect. (In theory, a three-block ride could set you back $75.)
UberX, on the other hand, dispatches normal people in their own cars to pick you up. If your Uncle Freddie needs a little extra cash, he can get a job with UberX, driving his Honda Civic around to pick people up. The UberX service costs less than a cab.
Uber has operated its black-car service within Philadelphia proper since June 2012, and UberX has been available in the suburbs for some time. But, until now, UberX hasn’t been an option for Philadelphians because, as far as the Philadelphia Parking Authority is concerned, it’s illegal.
The PPA has authority over all taxis and limousines that pick up customers within the city. There are rules governing those vehicles, and the PPA enforces them. They even conduct sting operations to catch drivers who overcharge customers or refuse to take credit cards. (Yes, sting operations!)
In February 2013, the PPA’s Taxi & Limousine Enforcement Division conducted one such sting operation against Google-backed car service app SideCar, which is essentially the same as UberX. And after that investigation, the PPA kicked SideCar out of the city.
SideCar argued that the PPA’s authority didn’t apply to them, because they weren’t offering a taxi or limousine ride. It was, they explained, “ridesharing,” the idea that you’re basically just sharing a ride and throwing a guy a few bucks. But the PPA quickly called B.S. on that claim using the logic: If you are taking someone from point A to point B and there is money changing hands in one way or another, you are under the PPA’s jurisdiction.
“They can’t do this,” a PPA source told me then. “They have absolutely no authority to operate here. They have nothing.”
And apparently the same goes for UberX.
A PPA investigator I spoke with after the UberX announcement on Friday told me that UberX is just as illegal as SideCar was.
I asked him if the PPA would be conducting undercover sting operations against UberX this weekend.
“What do you think?” he said. “If we find a civilian car operating as an UberX, we will take the vehicle off the streets. We will impound the vehicle.”