Why Brazil needs Uber and Uber needs Brazil

April 26, 2017


Hardly a country has needed Uber so much as Brazil.

Between its huge traffic jams, chasm of social inequality, tumbling economy and ripoff taxi drivers, the nation of over 200 million people had been crying out for disruption. It has exploded in popularity here and is now the phone app’s third largest market after the USA and India and following the same narrative which has unfurled wherever the ride-sharing service has flourished, the taxi industry has declared war on it and regulators don't know what to do with it. 

 

Irate taxi drivers have assaulted Uber drivers and abused passengers and the Uber concierge desk at Rio’s Santos Dumont domestic airport was ripped apart after they became sick of seeing their once captive audience walking past them, smartphones in hand, to get a lift for half the price. Yes that’s right, in Rio an Uber is about half the price of a taxi.

 

 

Like the Uber story elsewhere it has gained the militant support of its users, 13 million Brazilians in total, who demand choice and competition from the stale, overpriced taxi industry. After the service launched in Rio in May 2014 it hit mega-metropolis Sao Paulo two months later which today stands as Uber’s second busiest latin-American market after Mexico City. It’s been a rapid growth story, at the start of last year just 1 million people used Uber in Brazil.

 

Now its over 50,000 mainly UberX drivers criss-cross the streets of 27 cities including Brasilia, Belo Horizonte, Campinas, Goiania, Curitiba, Fortaleza, Porte Alegre, Recife and Salvador. I’m one of the many young people fuelling its growth, I’ve only used Uber here except for when I had my phone stolen and was forced to use taxis which ended up being a slap in the face reminder of why I avoid them.

 

 

We all know as a foreigner in a new country it’s easy to be taken for a ride, the figurative shitty kind. My turn was when I was travelling back from Sao Paulo to Rio needing a late night lift home from the Novo Rio Bus Terminal. I was trapped, no phone and no choice but to walk into the mass of hustling taxi drivers parked outside. One approached me desperate for my business and against my gut instincts I went with him.

 

Getting close to home I pulled my notes out in the dark of the backseat and for the $44R fare I got a $50 to give him, my mistake. He could keep the change I thought so I went to get out the door before he called out to me. He held up a $5R, that’s all I’d given him apparently.

 

 
Confused and not being able to say much back with my terrible Portuguese I thought maybe I’d picked out the wrong note in the dark. I gave him another $50R, actually tipped him, and for the next hour racked my brain if I’d just been scammed with the old note switch or had genuinely picked the wrong one. 

 

I went through all my money and the proof was irrefutable, I had less cash than I knew I should have and an instant realisation why I hated taxis. I couldn’t get a new phone quickly enough. 

 

 

Besides doing away with these scams and dropping the sky-high taxi costs overnight to make it an affordable transport option for many of Brazil’s low-paid battling workers and young people, it’s also opened up jobs for anyone with a relatively new car. How important this is can’t be understated as Brazil’s unemployment rate has nearly tripled from half a decade ago to over 13%.

 

In my trips mainly around the south zone and to centro I’ve met drivers from Rio’s favelas like the coastal Vidigal where one young man was raising a family. Most others have been from Rio’s poorer north zone, many doing it as a second job, old and young, male and female. It's interesting to see how day to day Uber is connecting and distributing wealth between the city’s two often disconnected halves, north and south, rich and working class.

 

 

Criticisms have been levelled at Uber globally about how much drivers, who are independent contractors, earn, saying running costs especially sudden major repairs can leave them at no more than minimum wage or in the red. Uber counters that it offers flexibility that most jobs can’t.

 

The way I see it, Uber taps into a resource many people have, no education or training is required and you can start earning money when you need, especially if times are tough. The company isn’t forcing people to drive with it, it’s an extra option and that's probably how it is for most.

 

Recently a Brazilian judge ruled that Uber and similar app drivers should be considered employees instead of contractors after an Uber driver brought a case against the company. Showing the mindset behind these decisions, one parliamentarian during the discussion declared Uber was “pirate transport”. Uber argues the law effectively tries to turn it into a taxi service and is appealing.

 

 

Reuters reported on the growing number of murders and robberies of Uber drivers in 2016, focussing on the introduction of cash payments last year as potentially being the cause. As a result the company made it necessary for users paying cash to register their CPF, a uniquely identifiable social security number. The story also reported that cash is now used for 30% of Brazilian Uber trips allowing it to grow in poorer areas where credit cards aren’t common.

 

With so many people using it statistically crimes will occur just as they do on the evening news each day. If Uber drivers with cash are open to robbery, then normal taxi drivers must be like bright shiny beacons for crims. Cash opening the app up to poorer, fringe areas giving them a transport service they otherwise wouldn’t have is a great thing and not measurable in cold hard numbers alone. Think of an old woman needing to get to an out-of-area hospital, suddenly it’s a lot easier and cheaper.

 

 

Uber English also kicked off for the 2016 Olympics pairing tourists with drivers who know the language. Even though by virtue of the app’s nature that isn’t overly necessary it’s a nice touch for visitors to a new country, especially one with so many safety concerns as Brazil. If it was left up to the largely monolingual, technology-stunted taxi industry to help the country’s tourism industry beyond the bare minimum door to door drop off, well, don’t expect much. It’s the same story around the world.

 

Uber is now in 570 cities and since it bowed out from China last year Brazil has become even more important to its success. In India its battle against bank-backed Ola has been more difficult than against Brazil’s less-established rivals like Cabify, 99 and Easy Go which pale in comparison to the American company's dominance. 99 says it has 6 million users and Cabify 1 million but I rarely see them used, let alone mentioned in pop culture. 

 

 

No doubt there are many good, honest taxi drivers, but sadly the industry’s archaic nature means the people they need the most, their customers, are open to being ripped off. Uber largely defeats this while bringing so many other benefits that for many it's a no-brainer to use it. 

 

I would have taken more than 50 Uber trips in Brazil with no complaints, just a lot of awesome, semi-struggling conversations practicing my Portuguese from the backseat, Portuguese which is now good enough that I won't allow myself to be taken for a ride again.

 

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I'm Ian Walker, an Australian freelance journalist and travel writer who ditched his job as a full-time newspaper reporter to move to Rio de Janeiro, Brazil.

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