Still the driving force: Addison Lee boss Liam Griffin vows to fend off app upstart Uber

Addison Lee chief executive Liam Griffin says he won’t be drawn into a price war with rivals

If the tech sector has had the taxi and minicab industry in its sights for a number of years, then 2014 was when war broke out.

“We are in an industry that has seen more change in the last 12 months than it probably did in the previous 20 years,” Griffin says.

And, he insists, Addison Lee — set up by his dad John in Battersea  40 years ago — has been there every step of the way.

“We’ve led this market for a long, long time so there have not been that many surprises,” he says, sitting in his office in the company’s headquarters just east of Regent’s Park.

“The technology and whatnot, we’ve had many of these things in place for the last five years anyway. It’s just that somebody’s obviously come along with a whole new approach to it and has certainly made quite an impact.”

Who that somebody is doesn’t need to be said. At the start of 2014, San Francisco start-up Uber was operating in about 60 cities — by the end, you could use the smartphone app to book a cab in more than 250.

But with that breathtaking growth has come notoriety. Twice last year, the black-taxi drivers in the capital, angry at Transport for London’s decision to give Uber a private-hire licence, held protests.

Meanwhile, the company has also been rocked by stories putting its safety measures in doubt, such as an alleged rape by one of its drivers in New Delhi, as well as attacks on its business practices.

Not that its backers, which include Google, have been put off — in June a fundraising valued the company at $17 billion (£11.18 billion); just six months later, a fresh round brought that up to $40 billion.

“It’s quite phenomenal that if you said, ‘what was the fastest-growing company in the history of all companies — it’s a minicab company’, you’d go, ‘oh, do me a favour’,” says Griffin.

“It’s got to be Microsoft or Apple or Facebook or something else. You would never think it was a minicab firm.”

But for enthusiastic investors, Uber — and its rival apps around the world, which include GetTaxi, Lyft and the UK’s own Hailo — is the latest example of entrepreneurs disrupting a staid industry, a tech firm in the vein of Facebook or Google rather than a traditional minicab company.

“That’s a lovely idea, but that’s not the reality,” says Griffin. “As much as you dress them up, they are no different to us — they are minicab firms. They’ve got an app, we’ve got an app. They’ve got a Public Carriage Office licence, we’ve got a PCO licence. They recruit drivers, we recruit drivers — we all go and get the same customers.”

Once the novelty wears off, he feels, “the valuations will plummet and then we’ll come back to reality”.

Perhaps, but that hasn’t stopped Griffin, 41, taking note.

“It gets the brainwaves working — what should we do, how can we do that? Take some of their ideas,” he says. “They’ve clearly nicked a fair chunk of ours, so we’ll happily go and reciprocate.”

One thing Uber has done is put Addison Lee on the same side as London’s black-cab drivers.

“We never thought that would happen,” laughs Griffin. He sympathises with the protests against TfL, saying the body should not have given Uber a licence.

Like the black-cab industry, Griffin is also a strong believer in the need for drivers to be heavily trained.

“London is a complicated place, and being a minicab driver is not as simple as everybody thinks,” he says.

“We have lots of Uber drivers come to Addison Lee — we’ve had 48 apply this month, and of the 48 we’ve taken on eight or nine. That is because there is a big quality difference.”

He is more positive on Uber’s rivals. Sir Richard Branson-backed Hailo, set up by three London black-cab drivers, has had a tough time of it recently, having to pull out of North America, losing its co-founder and chief executive Jay Bregman, and angering drivers by deciding to work with private-hire vehicles rather than just black cabs.

The reaction to that last decision, says Griffin, “was no surprise to any of us in the trade”, but generally “they are one of the better ones”.

Then there’s Israeli start-up GetTaxi, which near the end of last year announced it was offering black-cab trips for just a fiver — albeit on journeys of 10 kilometres (six miles) or less that started outside Zone Two.

It was a bold move on price, but Griffin says he would only have been worried by it “if I was paying the bill — some of these guys have got deeper pockets than sense”.

Addison Lee has some firepower of its own behind it, with US private-equity giant Carlyle buying a majority holding in the company in a £300 million deal in April 2013.

Last autumn, Carlyle looked as if it was set for a swift exit amid reports that it would sell the company for £800 million, but any such plans seem to have been ditched for the moment.

“[Carlyle] love owning the company, they think it’s a great space to be in,” says Griffin. “They’re ready for the fight, they’re ready to back us and stick with us and to see what the next year or two holds.”

Still, Addison Lee won’t be drawn into a price war: “We believe people are prepared to pay for service. We’re not as expensive as everyone thinks we are — trust me, we’ve had consultants coming out of our ears looking at how we compare on price and the gap is not as big as everybody would seem to believe.”

But he accepts there is a difference with Uber — and it’s something he’s proud of: “We are a premium product — every market has its British Airways and its Ryanair.

“We’re here sitting here as British Airways, but people will always want the Ryanair equivalent.”

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