The Uber Man and the Taxi Dispatch Center - How Thomas Mohnke Has Conquered an Industry He Has Long Fought.

There are sentences that cause industry-wide frowns. “This trench warfare between taxis and rental cars must stop,” says Thomas Mohnke. Viewed in isolation, one could take this sentence for the appeal of an intermediary. For someone who wants to bring two feuding camps to the table. In fact, he is an entrepreneur who has stood on one side of this divide for years—and precisely on the side that has substantially contributed to the divide's very existence.

Mohnke is the managing director of SafeDriver Group, the general contractor for Uber in Germany, co-founder of the Bundesverband wirfahren, and for a few weeks now the owner of one of the country’s most traditional taxi dispatch centers: the Frankfurt Taxi Central.

For many taxi operators, this development seems like a political case study on power shifts in the platform economy. For years the trade fought against Uber and its business model. Now, of all people, a central actor in this system is taking over one of the most important institutions in the German taxi market.

Co-architect of the Uber model

Thomas Mohnke is not a random winner of the platform economy. He belongs to those entrepreneurs who have made the German Uber system possible in the first place. While Uber in many countries works directly with drivers, the company in Germany had to find other paths due to the legal framework conditions. From this arose a construction that today is regarded as the core of the German Uber business: Uber mediates the rides, SafeDriver or their subsidiary companies organize the operational execution. Mohnke thereby became a key figure of the platform economy in German passenger transport. His economic success does not rely on radio dispatch centers, cooperative models or municipal services. It rests on the logic of digital platforms: mediation instead of provisioning, scaling instead of regionality, data instead of local knowledge.

Exactly this logic has put the taxi industry under considerable pressure in recent years.

The story of unfair competition

From the perspective of Uber and its partners, it is an innovation process.

From the perspective of many taxi operators, the story looks different.

While taxi operations must comply with fare obligations, transportation obligations, operating duties and a multitude of other legal requirements, platform providers were able to grow for years with clearly lower prices. This was also possible because rental car companies are subject to different rules than taxis. There are clear statutory provisions for rental cars as well. But the reality of the past years has been shaped by proceedings concerning violations of the return-to-base obligation, discussions about mailbox operations, investigations against subcontractors and a string of new court decisions.

The taxi associations BVTM and TMV have been criticizing for years that a substantial portion of platform growth has been based on competitive conditions that are hardly comparable to those of a traditional taxi company.

Mohnke regularly rejects such accusations. The political fault line remained clear.

Here the platform industry.

There the taxi trade.

The opponent of minimum prices

This conflict became particularly evident with the minimum fare charges for taxis. Munich, Cologne and other cities have begun to introduce price floors. The background is simple: Municipalities want to prevent mobility from being offered at prices that are not economically viable in the long term. From the perspective of the taxi associations, this is a long overdue correction.

From the perspective of Thomas Mohnke and his association Wirfahren, it is the opposite.

When Munich passed the new rules, the association spoke of a rise in mobility costs. There followed announcements of lawsuits and warnings about restrictions on competition. The argumentation appears noteworthy to many taxi operators. For the same platforms that for years gained market share with low prices are now complaining about state interventions in price formation. For BVTM and TMV this shows a fundamental problem of the platform economy: As long as low prices create market shares, competition is considered desirable. Once municipalities define minimum standards, market distortions are suddenly warned about.

Frankfurt as a strategic move

Against this backdrop, the takeover of Taxi Frankfurt eG takes on special significance.

Frankfurt is not just any taxi dispatch center. With more than 1,400 connected vehicles, it ranks among the largest dispatch centers in Germany. It has built up longstanding customer relationships, regional market knowledge and infrastructure that has been developed over decades. Exactly this infrastructure is now coming under the control of an entrepreneur whose career is closely linked with Uber.

Mohnke speaks of a "strategic partnership".

He talks about digitization, modern dispatching and new services.

That sounds plausible at first. But those who look more closely notice a different process. For the real value of a taxi dispatch center no longer lies in telephone lines or radio technology. It lies in the customer interface.