Minister of Transport Miri Regev’s staff has for some time been looking for some significant achievement that will portray her as a minister who gets things done, in a ministry in which, contrary to political interests as elections approach, projects are planned for the long term and take years to complete, and are subject to delays and budget blow-outs. For example, Regev recently inaugurated the planning of the rail link to Kiryat Shemona, even though there is still no budget for constructing it; she presented a nationwide Metronit mass transit bus network, even though only the planning stage has been budgeted; and she was due to lay the foundation stone for the Metro project in the Tel Aviv area - a project she actually opposed.
This week, she started to promote a new reform whereby Uber will be allowed to operate in Israel. Many Israelis who have visited major cities overseas have benefitted from the transport service, which creates competition and offers attractive prices. The reform is a long way from materializing, however. It is unripe, controversial, and requires the courage to confront the taxi drivers, whose strong union has a powerful presence in the Likud central committee.
In advance of the bombastic announcement, all that Regev had done was to order the formation of a professional team to examine the move, to meet Uber and Lyft, which offer similar services, and to formulate recommendations. The professional staff at the Ministry of Transport have already considered the matter in the past. It was the subject of a well-publicized confrontation between Prime Minister Benjamin Netanyahu and then minister of transport Israel Katz.
An investigative report by Shomrim in 2022 revealed that, in its attempt to enter the Israeli market, Uber made contact with Netanyahu at the World Economic Forum in Davos in 2016. At that time, Katz opposed the move, because of the strength of the taxi drivers in the Likud party, and warned that NIS 8 billion compensation would have to be paid to drivers who had paid hundreds of thousands of shekels for taxi licenses, and would need to compete with drivers of private vehicles. Moreover, studies around the world have shown that Uber worsens road congestion, as people use it instead of public transport.
In the background is a dispute between the taxi drivers and the Ministry of Transport over fares. Fares within cities are due to be cut by 5%, while the fare for each kilometer over ten kilometers will rise by NIS 1.50. The new model led the taxi drivers to attack Regev and to threaten to settle accounts with her in the Likud party primaries. Regev’s response now seems to have arrived.
Besides the change in fares, the taxi drivers have also been hurt by the phenomenon of drivers in haredi society who pick up passengers without an appropriate license, via WhatsApp and Telegram, and take payment in cash. This of course affects not just the taxi drivers; it is illegal, and is liable to endanger the passengers. On the other hand, there are many flaws in the official taxi service as well. Enforcement is weak, and complaints are piling up at the Ministry of Transport about drivers who swindle tourists, the chaos at Ben Gurion Airport, and drivers who unlawfully refuse to operate the meter. The drawbacks of the service invite new initiatives that will lead to improvement and lower fares.
Zohar Golan, chairperson of the Union of Taxi Drivers in the self-employed forum of the Histadrut responded sharply to Regev’s initiative. "This is a move that will award legitimacy to all the illegal drivers, mainly in the haredi sector. This is the truth that Regev is trying to hide," he said. "She isn’t suddenly pulling the Uber service out the hat for nothing; she wants to find a solution for a group of potential voters and the haredi pressure group in advance of the forthcoming elections. Regev doesn’t care about the situation of public transport. She is trying to legitimize criminals by the back door in order to garner personal political capital."
At any rate, while the Ministry of Transport is devoting managerial resources to the attempt to bring a controversial service to Israel, government ministries have been astonished to discover that the speed of public transport declined last year in Tel Aviv and Jerusalem.
The rate of spending on paving dedicated bus lanes is NIS 400 million annually, whereas the five-year plan adopted in 2022 budgeted NIS 6 million.
Published by Globes, Israel business news - en.globes.co.il - on September 17, 2025.
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