Uber Is Now Legal

How the caper went down

After entering the Mexican market in 2013, the transportation ride-hailing business giant, Uber, has finally and legally been cleared to operate in Los Cabos; although not at full capacity. For instance, in Guadalajara, Mexico City and the other 41 cities Uber operates in Mexico, the phone app taxi service, is operational 24 hours a day. In Cabo, the Uber service hours are currently only from 10: 00 AM until 8:00 PM. The lack of qualified drivers with vehicles and the slow process of getting them approved and ready for the road., might be the reason why Uber has yet to get their Cabo business going at full 24-hour speed. And the fact that Uber has been fought harder here than anywhere else in Mexico. The taxi cartel is strongest here, and they are not amused. But the Supreme Court decision was not to be trifled with, so here they are.

One of the final hurdles the transportation company had to over come was announced in Mexico City on October 12, that a ban on cash fares for ride-hailing companies was struck down by the Mexican Supreme Court; which ruled by an overwhelming 8-3 vote; that such a ban was unconstitutional. Considering that Mexico is a country where 60% of its population does not have or use a bank account, and therefore, lack a credit or debit card, cash fares are imperative for the success of Uber. “We are celebrating this resolution,” said Sergio Romero, the company’s legal director in Mexico. “Our operation, and all the people that now are now  paying for their trips in cash, are now protected by the Supreme Court.” Rival ride-hailing service Cabify also applauded the decision, saying in a statement that it would democratize access for consumers without bank accounts. More than 50 percent of Uber’s trips in Mexico are paid for in cash, Romero said.

As reported by Rueters.com, transportation is regulated by states in Mexico, and a complicated patchwork of ride-hailing regulation has emerged since Uber’s arrival in 2013. For example, while cash fares are banned in Mexico City, they are permitted as soon as drivers cross into the surrounding state of Mexico. “I think it is a step in the right direction (for ride-hailing companies) to see a higher court take a stand and set the rules of the game,” said Edgardo Rivera, a former country manager of Cabify who is now co-chief executive of Bancompara, a loan comparison start-up. Ruling on another aspect of the regulation, the Supreme Court rejected a cap on the number of ride-hailing drivers who can work at any given moment, handing another win to ride-hailing companies like Uber and Cabify and Adalante.

The few local non-tourist area taxi drivers I spoke with for this article, said none of them would consider leaving their taxi driver career for a new one with Uber. In a quora.com blog, Daniel Baldor, a former driver at Uber said, "When I went on my short stint as an Uber driver, earnings were somewhere around $3,000 to $4,000 MXN per week in Mexico City; a sprawling metropolis of 8.85 million people. Earnings would be significantly less for an Uber driver in Los Cabos’ population of 267,000. Baldor further explained that his figures were “green” numbers (this is what is paid to the partner/driver once Uber takes their cut). Which theoretically translates to something around $12,000 - 1,6000 MXN per month. “I was in a 30% earnings model because I didn’t own the car. The car owner is paid by Uber, and I got paid 30% out of that. The upside being that the owner paid for gas refills, which were somewhere around $700 MXN per week, sometimes twice that much on a good week.''

Daniel Baldor also provided the following advice and information on his blog; 1) A Conductor, means you own the car. This cuts out any kind of middleman, and thus you’re doing all the work and earning all the money. 2) A Socio means a driver owns a car that has been fully paid off. 3) Uber ridership goes up and down every single week. There are good weeks, there are bad weeks. You don’t want to tie up your Uber income to car payments, as it’s possible you’d run into a month where your Uber income is lower than your car payments. 4) An odometer is going to rack up a lot of kilometers every day. Some Uber drivers spend a lot on their dream cars, then are shocked by their maintenance fees as they end up servicing their cars a lot due to the heavy usage the Uber car gets. An uberkit.net website stipulates an Uber driver in the U.S. working full time, earns about $45,500 dollars a year. Uber.com states that partner working with Uber in New York is guaranteed $5,000 take home pay for 200 hours of work in a month. Cabo is a much smaller city and earnings in Mexico per year would be significantly less. Maybe. Remember, ride hailing companies need only be competitive with the taxis, which charge an ungodly amount of money, way more than a Mexico City cab driver. The market will sort itself out.

Of course, the other troubling aspect of Uber in Los Cabos in the lack of an address for pick ups, wherefore, someone might actually have to walk to a location available on their maps, as I had to walk a block away for a pick up at a Moderna Pharmacy. A whole block. For a ride half the cost of a taxi. Remember, the driver can see where you are holding your phone.

Many locals and frequent visitors to Cabo welcome the Uber option, proclaiming their ire over the taxi mafia decades-long, ''taking advantage of tourists with their outrageous prices.'' Others of course, have voiced their fears of facing the wrath of union taxis "hunting down" Uber drivers, which has occurred years ago in Tijuana, Guadalajara, Mazatlan and Mexico City; and yes, here. Just last week an Uber driver was stopped,, the tourists made to get out, and transfer their luggage and themselves to a taxi.

In terms of savings, a taxi mafia ride from the downtown hotel area to the airport costs $80 US dollars, whereas the same trip with Uber is offered at $32 USD. Stick a fork in the taxi mafia: They’re done.