An agreement between Uber and the New York City Taxi and Limousine Commission will allow drivers of the Big Apple’s iconic bright yellow taxis to claim rides via the app — and get paid like an Uber driver would.
Of course, this agreement comes when Uber is the one suffering lost income from driver shortages and higher fares. It didn’t come in 2018, when cab drivers were taking their own lives over the business lost to Uber. It didn’t come in 2021, when cabbies went on a hunger strike to get debt relief from the New York City’s Taxi and Limousine Commission for the dropping value of taxi medallions in New York caused by ride-share services (they got the relief, not access to the app.) But now that Uber needs them, New York cabbies are in. From the Wall Street Journal:
Uber Technologies Inc. UBER +3.69% is becoming friends with a former foe.
The company has reached an agreement to list all New York City taxis on its app, an alliance that could ease the ride-hailing giant’s driver shortage and temper high fares while directing more business to cabdrivers, whose livelihoods were affected by the emergence of car-sharing apps and the pandemic.
While Uber UBER -0.87% has formed partnerships with some taxi operators overseas, and riders in several U.S. cities can use its app to book taxis if cabdrivers choose to be listed there, the New York City alliance is its first citywide partnership in the U.S. New York, one of Uber’s most lucrative markets, has been a battlefield for the company and the city’s iconic yellow taxis for years.
“It’s bigger and bolder than anything we’ve done,” said Andrew Macdonald, Uber’s global mobility chief. The company expects to launch the offering to riders later this spring.
The New York City Taxi and Limousine Commission will integrate its proprietary app with Uber’s, and passengers will pay roughly the same rates for both. Taxi drivers, the report says, will receive a minimum time and distance rate set by the TLC and will be paid the same amount an Uber driver would be paid when they take on an Uber fare, which might come out to less or more than a metered ride, it all depends on demand.
Uber spent years burning through piles of cash trying to “disrupt” the taxi industry by avoiding long-standing regulation and people were hurt in the process. At least eight cab drivers killed themselves over mounting debt and lost income from Uber siphoning off business. Now that market-disrupter needs the business model that it sought to destroy for so long. Uber now says it wants to list every taxi in the world on its app, according to the Journal.
Meera Joshi, a deputy mayor of New York City who oversees the TLC, said the alliance creates economic opportunities for taxi drivers “without adding more and more cars.”
“The word ‘disruption’ was almost in some way a superficial word,” said Ms. Joshi, who previously served as a TLC commissioner. Uber modernized the taxi industry, lowered the barriers to entry and made riders accustomed to service at the touch of a button. But it didn’t kill taxis or alter the fundamental nature of the service, she said.
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No, Uber didn’t kill the taxi. But it’s “disruption” of the system that turned New York’s taxi medallions from a prize worth more than $1 million into a looming, despair-inducing unpayable debt. It took years, protests and a hunger strike to get anyone to fix the debt problem for taxi drivers, and even then, it wasn’t clear they’d win any relief from the city.
It all seems too little too late.