In a ride-hailing first locally, a company has been given the green light to operate in Kamloops and could hit the streets by the end of the year.
The Passenger Transportation Board, which licenses commercial vehicles in the province, has approved Kabu to operate in all regions throughout the province. Kabu is owned and operated by Richmond-based Gokabu Group.
KTW is awaiting a return call from Kabu.
A written decision released by the Passenger Transportation Board notes that Kabu Ride Inc. seeks to operate immediately in the Lower Mainland, Victoria and Nanaimo and expand to Kelowna within the first year of launch.
A fleet of 40 vehicles is expected to serve Kelowna and Kamloops by the end of 2020, with the hope of increasing the fleet to match demand, the decision states.
Kabu — which on its website describes itself as a Canadian ride-hailing software-development firm that has operated in the Vancouver area since 2016, providing more than one-million rides — applied on Sept. 3, 2019, for a licence to offer ride hailing in all areas of the province, including Kamloops.
City of Kamloops business licence inspector Dave Jones said he will reach out to Kabu to determine if and when the company plans to operate in Kamloops. Jones said an approved application does not necessarily mean that the company is going to come. If so, he will encourage the company to arrive sooner.
“For us, there’s an opportunity for Kamloops, Kelowna to do quite well in those areas,” he said.
A business licence will be required by those who drive a ride-hailing vehicle, the same one that is required by taxis in Kamloops.
“We’ll just call it a transportation licence,” Jones said, noting some language may need to be updated in city bylaws.
Cab companies are charged a business licence fee of $67.20 per vehicle. Cab companies typically own their vehicles and hire employees. Comparatively, Kabu is a platform and individuals sign up to drive, providing their own vehicle and essentially creating their own business in the process. It will be up to that driver to obtain a business licence.
“We’re not going to treat a ride hailing vehicle any different from a taxi,” Jones said.
The Passenger Transportation Board only recently began reviewing ride-hailing applications, for which it has received more than 20 since the province began allowing the service. The board grants licences based on public need, whether the applicant is “fit and proper” and capable of providing the services and whether the application promotes sound economic conditions in the passenger transportation business in British Columbia.
That last point has been a major sticking point with the taxi industry throughout the province, which has expressed concerns around ride hailing and lack of a level playing field, when it comes to regulation of taxis compared to ride-hailing companies.
Written submissions on the application were submitted by both Kami Cabs and Yellow Cabs in Kamloops, though they are not referenced again in the board’s decision. KTW asked to view those submissions, but was told by PR Associates, a public-relations firm hired to do communications for the Passenger Transportation Board, those submissions cannot be accessed by the public.
Kami Cabs told KTW it wants to the read the decision and speak to the City of Kamloops before commenting on the approval. KTW also has a call in to Yellow Cabs Kamloops.
In its decision, the board wrote that it “is satisfied that granting Kabu’s application will promote sound economic conditions in the passenger transportation business in B.C. …”
Kabu apparently plans to tap into a niche market underserved by other transportation service providers, drawing drivers from the growing pool of newcomers to Canada, including new immigrants, international students and tourists, the decision states.
“Kabu maintains that it is seeking to solve transportation shortcomings across British Columbia where there is a demand for ride hailing and sufficient supply of ride hailing drivers,” the decision states.
“The company has identified an under-served and growing niche market across Canada that focuses on transportation for minority groups … Kabu says that by speaking in their native language and providing services via familiar channels, such as social media channels popular in their home country, Kabu can capture market share that other service providers have shown little or no interest in. Kabu provided information on the size of the markets for tourism, international students and new immigrants to Canada and the United States.”
It will offer drivers a living wage, provide industry-leading driver health benefits reward system, such as subsidized health, dental and disability benefits and a $250,000 life insurance policy.
Drivers will be required to agree to a driver and company policy, have a class 4 license, conduct start-of-day and end-of-day inspections to their vehicle and keep a logbook with dates and times that is submitted weekly, conduct vehicle inspections and provide a new driver abstract.
“It also says that whether and how it opts to work in regions three, four and five will depend on its ability to recruit a critical mass of class four drivers to serve the region,” the decision states.
The minimum rate in Kamloops will be $3.50, set based on taxi flag rates operating in a region and determined by the board. Coupons and discounts to lower rates are off limits.
Grey market rides
The Vancouver Sun noted in a December story that Gokabu Group has been operating Kabu Ride in the “grey space” for more than three years, with hundreds of drivers pulling in more than $10 million a year combined, according to company spokesman Martin van den Hemel.
Last September, the Kabu ride-hailing app was disabled as the company sought to comply with provincial regulations ride-hailing legislation as it applied for a licence.
“We have stay-at-home moms who work for two or three hours a day while their kids are in school,” Hemel told the Sun. “We also have drivers who work 50 hours a week and make north of $65,000 a year.”
In January 2019, Kabu was among a number of ride-hailing companies cited by the Ministry of Transportation as operating illegally in the Lower Mainland.
Approval follows rejections
Last month, the Passenger Transportation Board rejected applications from two companies seeking to establish ride-hailing services in the Kamloops area.
The rejection of Kater Technologies and ReRyde Technologies occurred as the board approved applications from Uber and Lyft’s to enter the Lower Mainland and Whistler markets.
The board cited the business plans of Kater and ReRyde as part of the reasons for the rejections.