The South Australian Government has announced that it is regulating ridesharing services, giving the go ahead to startups like goCatch and Uber to offer their services as of July 1.
The changes made to South Australian legislation follow on as a domino effect from NSW and ACT legalising ridesharing a few months ago.
Ned Moorfield CEO of goCatch said the changes are a positive step in the right direction.
“We’re really keen to provide a choice of competition, which is going to be needed in Adelaide. It’s really just us and Uber on the market. We definitely see ourselves rolling this out on the market nationally.”
Moorefield expects to see the changes roll out in Tasmania next and said the service is prepared to go nationwide as soon as all states legalise ridesharing.
To offset any impacts the changes may cause to those who are already working in the ridesharing industry the South Australian government will offer an assistance package. This package includes a $30,000 payment per taxi licence and a $50 a week in compensation for licence lessees, which will be provided for a maximum of 11 months.
The compensation package will cost $31 million and the loss of revenue from plate sales will amount to an estimated $24 million. New taxi plates will be frozen by the government for at least five years.
Jim Triantafyllou, Taxi Council SA president, said these reforms would create a massive cost advantage for new entrants who will now pay less for compulsory third-party insurance.
“The contrasting costs on the taxi industry, based on the regulatory framework, are astronomically higher,” he told Channel 7.
Along with paying less for insurance, ride sharers will also receive government subsidised fares for passengers with disabilities.
Premier Jay Weatherill said legalising ridesharing helps to deliver an equal playing field for taxi operators, chauffeur drivers and startups like goCatch and Uber.
“We want to make sure that all of the existing entrants in the industry have a fair and just transition to the new arrangements,” he said.
While changes to the ridesharing industry need to be careful not to step on the toes of the taxi industry, transport minister Stephen Mullighan explains the government had consulted widely to effect these changes.
The introduction of a new tariff will apply for Friday and Saturday nights to introduce a “long overdue fare increase,” said Mullighan.
Taxis will still have the benefit of working at ranks and being hailed, however the Uber and goCatch disruption to the industry and their enormous success show drivers and customers want better experiences and services.
Of course all drivers and vehicles will need to comply with driver accreditation and undergo police and working with children checks along with vehicle roadworthiness standards.
goCatch has recently announced new sets of developments to improve the whole user experience. Moorfield says goCatch has re-written its dispatch algorithm and now uses Google Directions to factor in traffic data and more easily identify which drivers are best to dispatch to a job. The competition between goCatch and Uber is strong, however Moorfield believes the Aussie startup has the right tools in place to capture the local market.
The South Australian market is small in terms of Sydney, and ranks fifth nationally among taxi volume. However the new reforms in SA is just another part of the government’s acknowledgement of the power and popularity of the ridesharing economy.