Controversy as Shanghai plans to ban taxi apps that show rider’s destination

There may be lots of room to grow for China’s taxi apps, but there’s also lots of room to legislate. And recently Shanghai, one of China’s biggest markets for taxi apps, released a draft of proposed legislature that would definitely change the way some apps work by making it illegal for drivers to be able to see a rider’s destination before they get in the cab.

To be clear, this isn’t actually the law yet. The draft legislation has been released to the public for comment, and the decision to pass it, revise it, or scrap it entirely will be made following this open-comment period. But the proposed ban has already proved controversial within the taxi industry.

The justification for the ban is that it would prevent drivers from rejecting potential fares based on the destination. Drivers are meant to accept fares whenever they’re on duty regardless of the destination, but in practice many drivers will reject potential riders whose destinations are too inconvenient to be worth the driver’s time. Shanghai’s Transportation Committee, which proposed the legislation, fears that allowing drivers to see rider destinations via apps before they even get to the rider could lead to drivers becoming even more choosy, and accepting only riders who intend to travel to convenient locations. Currently, cabs in Shanghai are in high demand especially during peak hours, and passengers traveling toward inconvenient or traffic-congested destinations may find it nearly impossible to hire a cab.

Is this a good idea?

Some industry insiders fear that this regulation, while well-intended, could hold back the development of the industry. Allowing drivers to see rider destinations also has some advantages. It allows drivers, for example, to gas up before taking on a longer fare so that riders don’t need to waste time sitting at gas stations. And it allows drivers to more easily pick up extra fares on the tail ends of their shifts: when heading home, many drivers wouldn’t pick up a random passenger because their destination might be out of the way, but they’re generally much more open to taking on passengers heading in the same direction they are. It could also help drivers avoid traffic and complete fares faster by giving them time before they pick up their fares to check out current traffic conditions and plan the most efficient route to the destination.

Passengers, on the other hand, seem to be pretty happy about the proposed legislature. A reader survey on Sina Tech has found that as of this writing, more than 56 percent of respondents support the change (just over 35 percent oppose it), and more than 50 percent also believe the law would influence how easy it is to successfully hire a cab in Shanghai.

Personally, I agree with the Sina Tech readers here. Although there are definite advantages to allowing drivers to see the destinations of potential fares, they are outweighed by the massive potential downside: drivers steering clear of certain destinations en masse, making cab travel there virtually impossible. It remains to be seen whether Shanghai’s legislators will actually enact this regulation following the public comment period, but given the public support for it, some kind of restriction certainly seems likely.

(Source: Sina Tech)