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New ride firms would fill gap left by Uber

Just a few days after U.S.-based ride-sourcing company Uber pulled out of Budapest due to stricter regulations, new companies are eyeing the gap Uber left behind, according to reports. Estonian Taxify has announced a launch in August, while a Hungarian app may be launched even earlier.

A Hungarian company, previously a sub-contractor for Uber in Hungary, is planning to launch a mobile application for its services in the upcoming days, Hungarian daily Magyar Idők reported on July 26.  

The name of the company has not yet been revealed, but it is believed to circumvent the strict rules on providing taxi services in Hungary by renting vehicles to passengers, according to reports. The company is expected to start operating its service with a small number of drivers and to demand higher fares than Uber charged, while still undercutting traditional Hungarian taxis, the paper reported.

However, the Hungarian company is not the only one planning to fill the hole Uber left behind, as Estonian competitor Taxify has announced the launch of a service in Hungary in August, Hungarian online daily reported.

Taxify, which has Skype and many other tech giants as investors, promises to deliver the same technology and concept that Uber offered, while complying with all the relevant Hungarian regulations. Its mobile applications are available for Android and iOS mobile phones.

Uber announced July 13 that it had decided to temporarily halt services in Hungary after months of demonstrations by taxi drivers led the Hungarian government to introduce tough new laws regulating drivers for hire. If the regulatory environment changes in the future, Uber said it would resume its services.

Uber said in a statement that the new law that took effect on July 24 makes it possible for “Uber drivers to lose their licenses or the license plates of their cars, despite the fact that they have all the necessary licenses and pay the required taxes”.

The company said it does not wish to expose drivers to these risks.

Uber had negotiated with the government in an effort to find legislation that would protect taxi drivers while letting the ride-sharing service operate, but the law finally passed seemed to make it impossible for Uber to work in Hungary.

Hungary’s National Development Ministry alleged in its own announcement on July 13 that Uber would rather leave the country than engage in lawful operations, enter fair market competition with taxi drivers and pay taxes appropriately, according to Hungarian news agency MTI.