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Uber CEO's aggressive driving proves contagious

Uber is beginning to reap what it has been sowing. The smartphone-based car service keeps growing by defying the rules of the road, as defined by local regulators and established taxi businesses. Chief Executive Travis Kalanick's aggressive approach, which includes paying fines incurred by its drivers, seems to be working: The latest investment round valued the company at $40 billion. Uber drivers, however, are taking their cues from him.

On a recent Sunday night, a passenger tried to hail an UberX car at New Jersey's Newark Airport. After accepting the trip, a driver with a stellar rating called to ascertain the pick-up point and destination. After learning he would be going to a suburb 10 miles away, the order was dropped. Minutes later, another highly rated driver canceled. "There was a mix-up," Uber said in a text message.

When a third driver called to ask the destination, the passenger hung up, pretending not to hear. The driver arrived and was unhappy to learn he would not be going closer to home in New York. Earning a $17 fare instead of a $100 one to the city also might have darkened his mood.

Uber drivers are technically not allowed to reject a trip on the basis of the drop-off location, and can be de-activated for doing so. In fact, Uber professes to "blindly" provide ride reliability, regardless of a customer's background or destination. It says the cancellation rate for drivers is "an incredibly small percentage of trips," but doesn't disclose the figure.

In another sign of how Uber drivers are emulating Kalanick's defiant attitude, some are suing the company for designating them as independent contractors rather than employees. As employees, they would be reimbursed for gas and auto maintenance. A judge recently refused Uber's request to decide the issue without a trial.

A victory for the drivers could undermine Uber's business model, one that Piper Jaffray recently forecast would grow from $625 million worth of rides last year to $68 billion by 2020. The culture Uber is engendering, however, could turn out to be a serious obstacle to reaching that sum.