The North Africa Journal: February 21, 2018: There is a great deal of jubilation among Morocco’s taxi drivers and the leaders of the transport sector as Uber, the ride-hailing service announced that its last ride in Casablanca will take place on February 23. Present in Morocco since 2015 as part of an Middle East/North Africa $250 million investment, the company has not been able to operate in a market where the legal environment governing the transport sector has not changed for over half a century, preventing it from operating normally, let alone grow. The Moroccan law not only does not recognize Uber, hence operating illegally, but also its very presence has been characterized by a union leader as “toxic.” And because its business is perceived by local taxi drivers as having a cannibalizing effect, altercations between Uber drivers and taxi drivers have been reportedly escalating over time.
The company’s message explaining its withdrawal from Morocco focused on the lack of updated regulation. It mentioned lack of clarity in “integrating applications like Uber into the existing transport model,” a statement that goes straight to the heart of the current 50-year old legislation. Uber statement also mentioned that Morocco deserved “a modern regulation that encourages innovation and competition,” hinting on the monopolistic hold of the current taxi industry. As such, the company’s presence has stagnated, only present in Casablanca, with less than 20,000 rides in three years. With such a small footprint, in a business that requires a much bigger scale to general decent margin, it was just a matter of time for Uber to bail out. There is also the internal pressure on Uber management, whose key shareholders have been pressuring to focus on advanced economies where local regulations have been updated to meet the mobile trends and banking/payment technologies.
For transport industry unions, Uber’s withdrawal is no big deal. The company has had a tiny footprint, and is therefore “not so relevant in the large scheme of things,” said a taxi driver in Marrakesh where Uber does not operate. Quoted in the French press, the head of the Democratic Organization of Transport Professionals said Uber’s exit is simply a reflection of a failed strategy, and Uber “cannot blame the Moroccan authorities. Other ride-hailing services operate in the country in the same conditions.” Still, Uber pledged to return to Morocco as soon as the legislation changes.
