Data leak exposes dubious lobbying by Uber

Data leak exposes dubious lobbying by Uber

New York, Frankfurt, Berlin Ever since he took office, he’s been trying to be sure Aboveboss Dara Khosrowshahi about improving the image of the driving service. However, a massive data leak is now causing the group to be caught up in its past. The data show how Above has been enlisting politicians and scientists for years and trying to influence public opinion and the laws in its own favor with a campaign worth millions.

A former Uber manager revealed himself as the source after the publication. Mark McGann was a lobbyist for the car service broker in Europe. He decided to act as a whistleblower because he believed that Uber deliberately flouted the law. “I’m partly responsible,” he told the Guardian.

He was the one who tried to convince governments and the public of the benefits of the Uber model. Now he has a guilty conscience: “We actually sold people a lie.”

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The analyzes published on Sunday evening show, among other things, the dubious methods with which the Silicon Valley company wanted to gain access to the European markets, including with the help of massive lobbying – for example to Germany to change the Passenger Transport Act.

That’s how he mediated FDP-Politician Otto Fricke, who was not a member of the Bundestag at the time and worked for a consulting firm, organized meetings with politicians, including the Federal Minister of Transport at the time Alexander Dobrindt and State Secretary Dorothee Bär (both CSU). The aim was to change the passenger transport law, writes the “Süddeutsche Zeitung”, citing the documents.

In the documents, Uber representatives described Dobrindt as “open-minded and impartial.” The politician explained to the SZ that he was not aware of a targeted lobbying campaign with him as the declared “main goal”. In meetings with Uber representatives, he only described the legal situation and referred to existing or ongoing court proceedings.

Uber founder Kalanick himself had to resign after several scandals, but became a billionaire with the IPO. Uber’s backers included Menlo Ventures, Google venture, MicrosoftFidelity and the Vision Fund by soft bank.

Lobbying for a change in the law

With capital from well-known financiers, Kalanick has pursued aggressive global expansion for years. However, the driving service met with resistance in numerous countries. Authorities and courts often banned the service in whole or in part. Also in Germany.

The Uber Pop app was particularly criticized: it was intended to enable private individuals to find passengers and take them with them in their own cars, even without a passenger transport permit. That was a violation of the Passenger Transport Act, as several courts found — which didn’t stop Uber from offering the service for a few more months.

Uber now abides by the law. The group only works with drivers who have a passenger transport license. This service is available in 16 cities including Berlin, Munich, Dusseldorf, Frankfurt, Cologne and Hamburg.

Incidentally, an amendment to the Passenger Transport Act has been in effect since 2021. It does not offer major improvements for new mobility providers such as Uber: they are only allowed to accept orders that were previously ordered via app or telephone. “Taxis are still the only ones who can spontaneously pick up passengers,” said the Federal Ministry of Transport. The industry has therefore retained parts of its legally protected monopoly.

Macrons personal commitment

Uber is also said to have exerted massive political influence in other countries. Especially the incumbent French President Emmanuel Macron According to the documents, he is said to have personally campaigned for Uber during his time as finance minister.

There are said to have been four meetings between Uber boss Kalanick and Macron, reports the French newspaper “Le Monde”. A secret agreement is said to have come about, which is said to have made Uber’s business easier.

As finance minister, Macron “naturally exchanged views with numerous companies,” said a spokesman for the president. It was also about lifting certain administrative or regulatory blocks.

On Olaf Scholz, then mayor of the city of Hamburg, said Uber had lost his teeth. He is said to have insisted that the drivers get the minimum wage. A top manager then labeled him “a true comedian,” writes the Guardian.

Economist Haucap: Opinion against payment

Last but not least, Uber tried to influence the discourse with studies and reports from scientists. Renowned MIT and Princeton economists publish papers which made the transport service provider appear as a good employer.

In Germany, Uber hired the well-known economist and former head of the Monopolies Commission, Justus Haucap, to write a study with results favorable to the company and bring them to the media and scientific journals.

When asked by the Handelsblatt, Haucap admitted that it was involved in preparing the study on behalf of Uber. The aim was to analyze the consumer benefits of liberalizing the taxi market. “Whenever the study was the subject of a publication or presentation, it was clearly identified as a study commissioned by Uber,” the economist said.

In addition, all editorial changes proposed by Uber in connection with the study were only considered “if they could be supported by the study authors and were consistent with the scientific results of the study”.

>> Read about this: How Uber used well-known scientists for itself

However, emails contained in the Uber files suggest that Haucap has agreed with Uber to publish the pleasing results in the “Frankfurter Allgemeine Zeitung” (FAZ). A corresponding article appeared there in 2014. Haucap is a member of the Board of Trustees of the FAZIT Foundation, which aims to ensure the journalistic independence of the FAZ.

According to Haucap, in addition to preparing the study, it was also agreed to write a press article. A “Newsletter” article was then billed in March 2015. “Today we can no longer reconstruct what contribution it was supposed to have been,” said Haucap. “But it was definitely not the FAZ article.”

Haucap also explained that there was no connection between the FAZ article from 2014 and his membership of the FAZIT Foundation Board of Trustees. “How could this have been possible: I’ve only been a member of the Board of Trustees since April 2016.”

As the Handelsblatt reported in 2017, Haucap published a study on mobility markets commissioned by Uber in 2015 in the specialist journal “List Forum”, which it publishes itself. In the same year he published a positive article on Uber and other companies in the “sharing economy” in the magazine “Wirtschaftsdienst”. One looked in vain for a reference to the parallel commissioned work for Uber in the Wirtschaftsdienst article. When asked, Haucap explained at the time that the disclosure had been inadvertently omitted.

Haucap’s commissioned works were part of a massive international campaign to steer scientific discourse in the spirit of Uber. To do this, the company, which had a massive PR budget at its disposal, hired some of the most renowned economists from the leading universities, such as Alan Krueger, Joshua Angrist and Robert Metcalfe. With data provided by Uber and with Uber managers as co-authors, they wrote studies that invariably had favorable results for Uber.

In particular, it countered widespread criticism of poor pay and poor conditions for Uber drivers. Unlike other such commissioned studies, thanks to the authors’ big names and connections, these were published in the most prestigious journals, ensuring that they are widely cited and continue to define scholarly discourse to this day.

Uber had emergency buttons during raids

In addition, the documents show that Uber apparently had technical emergency tools to prevent investigators from doing their job. With this type of digital “kill switch”, Uber is said to have made it difficult for authorities to access important data during searches. For example, during a raid in Amsterdam, the company’s own computer systems were blocked, according to the “Uber Files”. That was personally ordered by Kalanick, as the Guardian quotes from emails.

The then Uber boss “never authorized actions that would impede justice in any country,” said his spokesman. He also “never suggested that Uber should benefit from violence at the expense of driver safety”.

In addition, the founder explicitly demanded that Uber drivers deliberately go near protests by taxi drivers, where there was a risk that they would end violently.

Among other things, the documents document how Uber, following protests against the company in France organized a large counter-demonstration in 2016, with “15,000 drivers” and “50,000 customers,” as Kalanick wrote in chat messages published by The Washington Post.

He therefore downplayed the risk of possible aggressive behavior on the part of the other side: “If we have 50,000 passengers, they will not and cannot do anything.” At the same time, he seemed to take risks: “I think it’s worth it. Violence guarantees success.”

Uber stock has had little reaction to Uber Files so far

Uber manager Jill Hazelbaker wrote to the “Washington Post”: “There are many things that our then boss said almost a decade ago that we would not tolerate today.” But nobody at Uber was ever happy about violence against a driver . Kalanick’s spokesman also replied that he had never suggested that Uber capitalize on violence against drivers.

“We have never made excuses for past behavior and have no intention of doing so. Instead, we’re asking the public to rate us on what we’ve done over the past five years and what we plan to do in the future.”

Uber’s share price has lost around half its value since the beginning of the year.

More: The opponent of the German car industry is Tesla – not Uber

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