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Ride-hailing still navigating COVID curveballs

Labour shortages, regulatory policy contributing to struggles among smaller player
Whistle offers ride-hailing services in resort communities such as Tofino and Whistler, where giants like Uber and Lyft have remained out of the picture.

Dylan Green was riding high off all the free media coverage his Tofino company drummed up two years ago when it became the first in B.C. to land a ride-hailing licence from regulators.

“Then, sure enough, we had about a month under our belt before COVID hit,” said the founder and president of Green Coast Ventures Inc., which offers ride-hailing services under the Whistle banner in resort communities like Tofino and Whistler.

While Uber Technologies Inc.and Lyft Inc. have focused their attention on Metro Vancouver, Whistle and other B.C. ride-hailing services have been filling in the gaps in smaller markets rather than competing against the giants. But these local firms say regulatory policy coupled with tight labour markets continue to put a squeeze on smaller providers.

“Getting drivers is a big challenge,” Green said, referring to the Passenger Transportation Board requiring all ride-hailing drivers possess Class 4 commercial licences rather than the standard-issue Class 5 licences.

After operating a bus service in Tofino for about 15 years, Green said he understood the challenges traditional transportation companies faced meeting peak demand in small communities that would see bursts of tourists flood in during weekends or at certain times of the year.

Hiring locals to meet that demand was part of the appeal of launching a ride-hailing company in a smaller market left untouched by Uber or Lyft, but two years in, it’s still a slog recruiting local drivers with Class 4 licences, Green said.

“It has made it difficult for us to meet all of the public expectation of what they were hoping to get with ride-share,” he said.

Unlike Uber or Lyft, Whistle depends on a mix of both employees who drive branded vehicles as well as gig workers who drive their own cars. About 20 drivers are based in Whistler while five are in Tofino.

“It really was a grind until this last summer,” Green said, adding the loosening of travel and other restrictions have ushered in the return of tourists.

Whistle also had to change software providers after the company previously responsible for its online booking platform dropped support for ride-hailing to focus on car-share and scooter-sharing services.

“There’s also more of these niche-use cases like providing only airport shuttle services, although having more local flavours helps quite a bit,” said Kristoffer Vik Hansen, CEO of Spare Labs Inc., whose Vancouver-based company now supports Whistle’s online booking.

Spare Labs marked November by closing an $18 million Series A funding round as demand for its technology – software that makes it easier for cities and transit agencies to manage transportation networks – has surged during the pandemic.

“Some of these providers, they’ve seen a lot of success where, Uber and Lyft are global players, right, so people are looking for more local services,” Vik Hansen said.

Uber and Lyft are available only in Metro Vancouver.

That leaves large swaths of the province without access to ride-hailing from those major providers.

But breaking into those markets remains difficult owing to the same policy and labour issues Green cited, according to Jamil Chaudhry, director of operations at Richmond-based ReRyde Technologies Inc.

His company offers ride-hailing services in Ontario and Manitoba but gave up temporarily on breaking into B.C.

“We couldn’t find the team we needed,” Chaudhry said, adding pandemic-era programs such as the Canadian Emergency Response Benefit, or CERB, may have dissuaded potential drivers from coming on board.

“After eight months of struggle, not finding the candidates who wanted to work, we had to pause for the time being.”

ReRyde plans to relaunch its B.C. recruitment campaign in January or February as it tries to break into markets like Campbell River, Kamloops, Nanaimo, Penticton, Prince George, Vernon and Victoria.

Meanwhile, a November 2021 report from RBC Economics found one-third of Canadian businesses are grappling with labour shortages amid 870,000 job vacancies. Employment in “high-contact” service sector roles remains 278,000 below pre-pandemic levels as of October.

“The labour squeeze will push wages higher – but other benefits, like flexible work arrangements, will also be critical as firms seek to retain or hire employees,” the report stated.

While B.C.’s minimum wage stands at $15.20 per hour, Metro Vancouver Uber drivers’ average net earnings amounted to $24.38 per session hour between July 2020 and June 2021, according to a September report released by Uber and conducted by consulting firm Accenture.

Chaudhry said Metro Vancouver might have a chance to recruit more Class 4 drivers simply because of the region’s density.

“But the other communities who [don’t] have those resources – people are just not going to go out there for a second part-time or casual job to get a Class 4 licence,” he said.