In the US, Uber's Market Share
In the US, Uber has a sizable market share as a transportation company. According to Bloomberg Eric Newcomer, it has a market share of between 84 and 87 percent in the US. According to Section 2 of the Sherman Act of 1890, the use of this by the firm to have enormous bargaining power in negotiating and entering agreements for the supply of transportation services constitutes a crime. Courts have taken this to demonstrate that monopolies are illegal if they are obtained by banned acts (Letwin 79).
Competition Between Lyft and Uber
Despite the fact that the percentages above are merely averages, it is evident that Lyft and Uber compete for the market share in certain cities in the United States. It is clear that Uber has the power to decide which states to operate in. In Swift & Co. v. United States, 196 U.S. 375 (1905), it was held that the antitrust laws entitled the federal government to regulate monopolies that had a direct impact on commerce. The actions of Uber of not operating in certain states like Wyoming, South Dakota, West Alaska, and Virginia no doubt have an adverse effect on commerce.
Uber's Dominance in New York
In some cities like New York, Uber is beating Lyft by a much wider margin in terms of trips taken by the transport company. Between April 2015 and April 2016, Uber completed 168,528 trips per day compared to Lyft's 26,783 trips, according to Morgan Stanley. This is due to its price discrimination as in some areas, Lyft has a better performance. Such acts are frowned upon by Robinson–Patman Act and regulations by the Federal Trade Commission.
Uber's Anti-Competitive Practices
In a bid to ensure that they are competitive in the United States market, Uber has of late been involved in offering subsidies in an attempt to win the trust of riders and drivers alike. As a result, Lyft has been occasioned a market loss in their efforts to compete with Uber. These practices will automatically be held by courts to be anticompetitive as they are obviously detrimental (Berlie 639). The locus classicus in this position is United States v. Trenton Potteries Co. 273 U.S 392 (1927) where the per illegality of the price fixing and agreement for prices was upheld as an abuse of dominant position.
Conclusion
In conclusion, the action of Uber as a transport firm amounts to anti-competitive practices that go against the antitrust laws in the United States. Generally, the antitrust laws are based on legislations, case laws, and regulations that though they do not criminalize monopoly, frown upon and criminalize the use of the acquisition of monopoly through prohibited acts.
Works Cited
Berlie, A. “The Developing Law of Corporate Concentration.” University of Chicago Law
Review 19.4 (1952): 639.
Letwin, W. Law and Economic Policy in America: The Evolution of Sherman Antitrust Act.
1965.
