Freenow President Alexander Mönch: Missed Opportunity

Munich's decision against minimum prices for rental car providers - from the outside, it seems like a small act. However, the decision by the Munich city council to forego minimum prices for rental cars in app-based transport could have greater consequences than Mayor Dieter Reiter is willing to acknowledge.

Taxi companies are increasingly facing competition that plays by different rules, explains Freenow Germany President Alexander Mönch. | Photo: Freenow
Taxi companies are increasingly facing competition that plays by different rules, explains Freenow Germany President Alexander Mönch. | Photo: Freenow

Alexander Mönch, Germany and Austria head of the mobility provider Freenow, does not hold back with criticism. The city has missed an opportunity, he accuses - a chance to "create fair rules for all mobility providers." Instead, says Mönch, an entire industry is being left in the lurch.

These are words that clearly describe the situation in the urban mobility market: Taxi companies are increasingly facing competition that operates under different rules. Rental car platforms like Uber or Bolt offer rides at prices below what many taxi operators consider economically viable. The consequence: a divide emerges - economically, but also socially.

Mönch speaks of a "structural imbalance." Of a market that is no longer in equilibrium because it circumvents rules and endangers livelihoods. He describes a competition in which not the better offer prevails, but the one that operates with fewer obligations—and with lower costs. In this system, minimum prices are not a bureaucratic obstacle but a "basis for fair income."

The withdrawal of Freenow from the rental car business is a statement—but also a warning signal. They no longer want to be a platform for a business model that "only works at the expense of drivers," says Mönch. The accusation is directed less at individual providers and more at the political framework that makes such a model possible in the first place.

That in the industry, rental car drivers struggle with precarious incomes despite full working weeks is no secret. Mönch calls it by name: demonstrations which only take place if paid for. That is not democratic discourse, but an economic reflex.

For cities like Munich, the question arises as to what kind of mobility they want to promote in the future. One that relies on innovation and platform logic – but ignores social standards? Or one that reconciles both?

The decision against minimum prices is often celebrated by its supporters as a renunciation of regulation. Mönch sees it more as a political failure. "It's not about ideology, but about economic reality," he says. A reality that is fought out on the backs of those who transport people from A to B every day – often under conditions that are barely livable.

"Taxis are not a dying model," says Mönch.

But to remain part of a fair mobility mix, political support is needed. That seems to be lacking in Munich for the time being. Whether this is a signal for the rest of the country – or a misunderstanding with consequences – remains to be seen.

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