05/20/2014 09:50 EDT | Updated 07/20/2014 05:59 EDT

Uber taxi app fuels Montreal, Toronto fare wars

Cabbies in Montreal and Toronto want their cities to put the brakes on Uber, the popular car service app that taxi firms say is disrupting the industry.

The online car-hailing service allows users to summon a ride simply by pushing a button on their smartphones. Uber has been a hit among clients in about 70 major cities worldwide since its 2012 launch, but the taxi industries in the only two Canadian cities with functioning Uber programs worry the app is driving business away.

Uber prices vary city to city, and users have in the past complained about price hikes at times of peak demand such as rush hour or during severe weather. The app introduced a "surge drop" feature earlier this year that lets users know when rides will get cheaper.

Unlike taxi or limo companies, Uber Technologies Inc. isn't licensed as a private car hire business and reasons it doesn't need the same kind of authorization, because it's a tech company rather than a dispatcher.

But that doesn't sit right with Canadian transportation regulators and taxi companies.

Dory Saliba, president of Quebec's committee for the development of the taxi industry, wants municipalities to do more to ensure the car service is playing by the rules.

'Protect the customers'

"They should protect us, they should protect the population, they should protect the customers, too," he said.

When an Uber-summoned car arrives in Montreal, it's a licensed cab. However, the taxi company isn't necessarily aware their driver is responding to an Uber call. The app only shows the user where the closest car is to them so the potential client can agree to a set fare, which is paid later by credit card.

In some other cities, the person behind the wheel may not be licensed as a taxi driver at all. Drivers would apply to be Uber affiliates on the California company's website, and Uber takes a cut of their earnings.

The business model is worrisome for Toronto taxi companies.

"I don't think it's fair," said Christine Hubbard, the operations manager of Beck Taxi. "You require a licence to operate in any city, and the idea that they are projecting themselves as a company unlike others that are already operating and that are licensed is false."

Hubbard said Uber is essentially a dispatch company.

Brussels bans Uber

But Jean-Nicolas Guillemette, the manager of Uber's Montreal operations, said that all Uber is doing is bringing high-tech to the act of hailing a cab.

"We don't do any dispatch, we don't do any publicity in taxis, so that's why we're not a taxi company," he said.

The City of Toronto is already taking Uber to court for operating without a licence.

There has also been international resistance, with taxi drivers in London, San Francisco and Paris staging protests. In Canada, the pressure forced Uber to give up its attempts to get a foothold in Calgary and Vancouver.

The Brussels Commercial Court banned Uber last month. Any driver there caught working for the service faces fines of up to 10,000 euros.

City officials in Montreal are watching to see how the issue will play out in Toronto before potentially laying charges against Uber.

In the meantime, Montreal customers like Alexis Cornelier are happy to log onto the app and enjoy the ride.

"I use it when I get drunk," the computer consultant said, laughing. "I really like the fact that we can use an iPhone application for things other than tweeting and Facebooking."