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Uber’s Canadian expansion plans include alcohol delivery and electric bikes, rival Lyft appears stuck in neutral

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Uber wants to start delivering alcohol in Quebec and bring electric bikes to Toronto as it gears up for a $119-billion IPO in early 2019.

Rival Lyft, which is racing to beat Uber to an IPO valued at up to $41 billion, is doing little to expand its market presence in Canada.

While Uber is lobbying for specific legislative and regulatory concessions as part of a nationwide push to open up new lines of business and solidify existing profitable markets, Lyft is lobbying governments across Canada with the goal of “opening discussions.”

The moves—along with a nationwide hiring spree and a $200-million September 2018 investment to expand Uber’s autonomous-vehicle development lab in Toronto—suggest Uber is following through on its commitment towards making Canada a central hub for its global operations. And, that the company is finding receptive policymakers across the country.

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Talking Point

Uber is looking to double its Canadian staff in 2019, start delivering alcohol in Quebec and put electric bikes on the streets of Toronto. Rival Lyft, meanwhile, is only hiring for three positions nationwide, and is lobbying governments across Canada with the goal of “opening discussions.” Both companies are racing towards IPOs this year.

“We are always looking to engage with governments to discuss how the public and private sector can work together to increase mobility options, removing short car trips during the busiest times, as well as increase affordable transportation options to those with limited options,” said Xavier Van Chau, Uber’s public policy lead for Canada.

In Toronto, Lyft lobbied city officials nine times in 2018 and twice so far in 2019; Uber lobbied city officials 168 times in 2018 and 13 times so far in 2019.

Uber has had a number of recent lobbying successes in 2018. In August, the company started delivering alcohol in British Columbia. In October, Uber got permission to operate in Quebec for another year, despite strong objections from the taxi industry and, in December, Saskatchewan passed legislation allowing ride-hailing drivers to use a Class 5 licence instead of limiting them to the commercial licence, which is harder to obtain. Uber had started pushing for that change in August.

One more potential lobbying win for Uber is coming in 2019. The Logic has learned that Quebec may allow the company to deliver alcohol.

Joyce Tremblay—a spokesperson for the Régie des alcools, des courses et des jeux (the provincial commission that oversees alcohol regulation)—said that Article 28.2 of Quebec’s liquor licence act does not permit third parties, including Uber Eats, to deliver alcohol. However, Bill 170 will “create a new type of permit,” said Tremblay. That bill became law on June 12, 2018, but the new type of permit isn’t ready yet, and Tremblay didn’t say when it would be.

Uber’s increased lobbying is coupled with a hiring spree largely tied to the September 2018 announcement of the AV lab in Toronto, which is expected to add 300 positions.

The company currently has over 31,000 active job postings—the vast majority for drivers, but also for 34 corporate positions, including a head of business development in Canada and six other senior Toronto-based positions. Lyft has three job postings in Canada: a Toronto-based general manager and two junior-level positions, one full-time and one part-time. By contrast, in the U.S.—the only other country where Lyft has drivers operating—the company has over 350 job postings.  

“As we continue to expand in the country, we are involved in conversations with officials across Canada to better understand regulatory landscapes, transportation needs, and economic opportunity,” said Fatima Reyes, Lyft’s communications manager for Canada.

Lyft did not directly reply to questions regarding whether it intends to hire more staff, why it is lobbying less frequently or whether it is asking for any specific legislative or regulatory changes.

At the federal level, Uber is lobbying the government for changes to the Excise Tax Act regarding ride-sharing, and the Motor Vehicle Safety Act as it relates to autonomous vehicles (AV).

Van Chau offered few details on what Uber is looking for: “Regulating AVs will be an incremental process, and we look forward to staying engaged with governments at all levels on this.” Earlier in December, though, Uber announced it would start test-driving AVs around Toronto.

Sau Sau Liu, senior communications adviser with the federal transportation department, said Uber is abiding by the guidelines for operating AVs.

“Based on feedback from provincial counterparts, the department understands that Uber has satisfied the safety requirements mandated by the Ministry of Transportation of Ontario, which is responsible for approving trials conducted on public roads in Toronto,” said Liu.

Quebec’s government is the only one Lyft is lobbying with a specific request. The ride-hailing company doesn’t currently operate in the province, but it’s hoping that changes to the province’s taxi act will make it easier for it to do so.

“The company Lyft has indeed approached the Ministère des Transports du Québec (MTQ) with respect to its online platform,” said Mila Roy, communications director for the MTQ. “At this moment, no decision has been made regarding the use of their services in Quebec.”

Currently, Lyft operates in nine Canadian municipalities: eight in the Greater Toronto and Hamilton Area, plus one in Ottawa.

Uber has had plenty of setbacks in its efforts to expand in Canada. The company has been pushing to enter British Columbia for years, but has faced fierce opposition from the taxi industry. Ride-hailing companies will be allowed to operate in the province as soon as fall 2019, but only under heavy regulation. Behind the scenes, though, the company has steadily helped shape the regulations it operates under in a number of provinces.

In 2015, Uber helped build a ride-hailing insurance product that allowed its drivers to abide by laws requiring car owners to own insurance while limiting what, if anything, Uber would have to pay out. Ontario adopted the Uber-designed insurance in 2016; Quebec, Alberta, and Saskatchewan followed with similar ride-sharing insurance products.

“We are engaging with ICBC [Insurance Corporation of British Columbia] in B.C. and MPI [Manitoba Public Insurance] in Manitoba in hopes that they will develop a similar product,” said Van Chau.

In addition to its lobbying, Uber is hiring a number of senior staff in Canada. A senior manager for safety will be responsible for leading “Canada’s national Safety & Standards program to ensure that Uber Canada’s processes and products set the global standard for transportation safety and transparency.” The company is also hiring an Uber Eats manager to “scale Uber Eats across Canada,” and a head of product design “for a new team that will transform how people get their groceries.”

All in all, Uber plans to grow its workforce in Canada from 300 employees to 600 in 2019. According to LinkedIn data, Lyft currently has 111 employees in the country, many of whom list their occupation as “driver.”