This is a rough saying but that’s the way it is. Originally green cabs were introduced to provide a safe and comfortable option for passengers that live in outer boroughs. But just in a few years after they had appeared, more and more drivers switched to black cars and to other well-known services that use apps in their work.
In 2013, Michael Bloomberg, who was New York mayor at that time, when creating this kind of taxi said that it would be a salvation for New York residents. He promised that this taxi would be much more convenient for move people living or working outside Manhattan. But in fact, at the moment “green taxi” exists only in words, and you can rarely see them on the roads.
And it’s strange because these taxis are equipped with fixed-payment meters as well as the yellow cabs. Drivers do not have to compete that makes their work so much easier. Perhaps the lack of finances at the moment does not allow green cabs to move to a new level of accessibility for disabled people and therefore they just disappeared from the roads. On the other hand, their absence can be provoked by officials who have recently tightened the rules of the “game” for passenger auto-transportation.
The “green taxi” program is now at the lowest point since its implementation. If in 2015 there were 6,300 licenses for this type of transportation and they made about 19.2 million trips, in 2017 the figures significantly reduced: 4,000 licenses that made only 11.7 million trips. The income from trips in May 2015 was almost $900 thousand, and in January 2017 – $331 thousand.
Drivers blame the city for the program failure. At first, drivers were supported by large-scale advertising campaigns. Now everyone has forgotten about their past promises and just let things play by themselves. Even borotaxis.org website simply stopped functioning. Many people who bought “green taxi” licenses before 2015 already tried to get rid of them in 2017 as they could not get out of the financial hole. For drivers it is certainly more profitable to work for private companies that have already filled the roads of New York, but this leaves no choice for passengers and greatly affects the traffic of the city as a whole. Representatives of the TLS promise that they will introduce rules that will increase the demand for green taxi services.
The best cap on Uber would be to fix the frigging subway
New York City is the first city to set a wage floor for ride-hail drivers and to cap the number of ride-hail vehicles on its streets, after the city council passed a package of bills on Aug. 8 and mayor Bill de Blasio signed it into law on Aug. 14. Over the weekend, drivers queued outside Uber’s office in Queens for hours to register their vehicles before the cap took effect.
The mayor has sought a cap on Uber since he failed to secure one in the summer of 2015, an embarrassing defeat made worse by Uber’s use of DE BLASIO mode, an in-app stunt that showed long wait times and no Ubers in the outer boroughs. His stated reason: congestion. The mayor is concerned about the vehicles that crowd our streets and pollute our air. In 2015, de Blasio wanted to cap Uber to “study” congestion. After city council voted last week, he touted the cap as a fix for “the unchecked growth of app-based for-hire vehicle companies” and “the congestion grinding our streets to a halt.”
But let’s be honest, there’s a much better way to cap Uber in New York City: Fix the goddamn subway.
This is not just the opinion of a frustrated and weary straphanger. Research shows that when people have access to good public transit, they use cars less. The opening of the Second Avenue subway in the previously transit-starved Upper East Side offers a good case study. Since service began in January 2017, yellow cab trips have plunged three times faster than in the rest of the city, the local department of transportation reported in June (pdf). Similarly, ride-hail grew more slowly on the Upper East Side than in the rest of Manhattan, and at nearly half the pace of all five boroughs.
Meanwhile, the subway is a dumpster fire—often quite literally. The New York City subway has the worst on-time rate in the nation, at 58% as of January, worse than the year before. Ten lines had on-time rates of below 50%. City comptroller Scott Stringer has estimated the annual cost of subway delays to workers and businesses at nearly $400 million. Yes, newly appointed transit chief Andy Byford has promised to fix it—and to get a dozen “Miguels” up and running by Monday—but things will get worse before they get better.
Where has de Blasio been through all this? Squabbling with the governor, squabbling with the governor about who will pay for the subway, talking up his Millionaire’s Tax, running red lights in his official motorcade, ignoring Byford, and, generally, not taking the subway. The mayor has also gone out of his way to oppose congestion pricing, a plan that not only would curb congestion by charging drivers to enter the busiest parts of Manhattan, but could also generate much-needed revenue to fund the subway rehabilitation.
Uber may have contributed to congestion in New York City but it is certainly not the root cause, nor will capping it fix congestion or do much to help stranded commuters. Local editorial boards were remarkably in agreement on this point, deeming the cap a “last-resort blunt instrument” and the case for it “weak.” Congestion pricing, fixing public transit—either of these would be far better options for reducing congestion than freezing the number of ride-hail vehicles. But this was never really about congestion. The mayor wanted a cap on Uber. And a cap is what he got.
Uber is going on the offensive and plotting clever ways to grow despite NYC’s cap on ride-hailing cars
Uber plans to use creative measures to remain competitive in New York City following the passage of bills that put a cap on and freeze the number of vehicles that may operate within the city for the next year.
On Wednesday, in a 39-6 vote, the New York City Council passed multiple bills that will pause the granting of new licenses for Uber, Lyft, and other ride-share companies for one year while a study is conducted by the Taxi and Limousine Commission (TLC) to determine the effects these companies are having on the city’s transportation industry. The legislation passed by the city also grants a new minimum pay-rate for drivers.
Prior to the vote, City Council Speaker Corey Johnsons said, “We are pausing the issuance of new licenses in an industry that has been allowed to proliferate without any appropriate check or regulation,” before adding that he does not expect the existing service for ride-sharing customers to diminish.
Mayor Bill de Blasio is expected to sign the legislation on Tuesday, which will take effect immediately.
With new regulations in place, ride-sharing companies like Uber will now need to work within the limits of the law to continue to remain competitive.
In a statement to Business Insider, Uber spokesperson Danielle Filson said, “We take the Speaker at his word that the pause is not intended to reduce service for New Yorkers and we trust that he will hold the TLC accountable, ensuring that no New Yorker is left stranded. In the meantime, Uber will do whatever it takes to keep up with growing demand and we will not stop working with city and state leaders, including Speaker Johnson, to pass real solutions like comprehensive congestion pricing.”
But Uber’s options under the license freeze are limited in part because of the company will now be restricted to an existing pool of vehicles.
A company spokesperson told Business Insider that Uber is ready to use creative measures to get around the language of the bills. First, the spokesperson notes that this cap is not a limit on the number of drivers, but rather a pause on the number of new vehicles. This distinction is important, as the company is thinking of reaching out to Uber vehicle owners who may be off the app for two or three days a week and see if they will allow new Uber drivers to use their vehicle when it is idle. This way, the company can ensure it keeps a high number of cars on the road despite a limit on new licenses.
Another way Uber plans to work-around the new measures will be to recruit from within the existing field of livery drivers, which includes yellow taxis and black-cars.
While voicing his support for the legislation, Mayor Bill de Blasio told the New York Times, “More than 100,000 workers and their families will see an immediate benefit from this legislation.”
Uber estimates the number of industry drivers in the area to be closer to 120,000, and an Uber spokesperson told Business Insider that the company believes there are at least 35,000 existing licensed vehicles not being utilized by their app system. In short, Uber plans to recruit black-car drivers into their network.
And while the newly passed bills plan on creating a new minimum pay-rate for drivers, Uber does not plan to oppose those changes to their business model.
An Uber spokesperson told Business Insider the company is “supportive” of a minimum wage or wage floor for their drivers.
The mayor’s office told Business Insider that he plans to sign the legislation on Tuesday, August 14, 2018.
Capping cabs:What’s the right number of taxis (or Uber or Lyft cars) in a city?
When Uber and Lyft first entered the market, offering a ride-hailing service that would come to include tens of thousands of amateur drivers, most major U.S. cities had been tightly controlling the competition. New York City allowed exactly 13,637 licenses for taxicabs. Chicago permitted 6,904, Boston 1,825 and Philadelphia 1,600.
These numbers weren’t entirely arbitrary. Cities spent decades trying to set numbers that would keep drivers and passengers satisfied and streets safe. But the exercise was always a fraught one. New York City now faces an even more complex version of it after the passage of legislation this week that will temporarily cap services like Uber and Lyft.
The city plans to halt new licenses for a year while it studies the impact of ride-hailing and establishes new rules for driver pay. In doing so, it renews an old question: What’s the right number of vehicles anyway?
The answer isn’t easy because it depends largely on which problem officials are trying to solve. Do they want to minimize wait times for passengers or maximize wages for drivers? Do they want the best experience for individual users, or the best outcome for the city — including for residents who use city streets but never ride taxis or Uber at all?
All of these goals are in tension. If you’re a ride-hailing passenger, you may want cars to materialize at your doorstep instantaneously. But a system that can do something like that probably also has a lot of empty cars waiting around, contributing to congestion and lowering driver wages.
The right number then is best thought of as more of a sweet spot in the trade-offs.
“There isn’t a right number — you want to get several right relationships here,” said Bruce Schaller, a former deputy commissioner in the New York City Department of Transportation and a longtime consultant. For years, he had this same conversation with cities eager to optimize their taxi fleets.
Cities began capping taxis in the 1930s, and many that tried deregulating the industry in the 1970s ultimately decided they needed to impose caps again.
San Francisco notoriously never got this balance right: By the dawn of the Uber era, it had about 1,700 licensed cabs.
“It is no accident that Uber and Lyft began in San Francisco,” Schaller said. “It wasn’t just because it was Silicon Valley. It was because they had seriously too few taxicabs.”
He and other researchers suggest the best way to capture these trade-offs is to focus on measures of how heavily taxis or ride-share fleets are utilized — how much time or how many miles they spend with a passenger in tow. Systems that rack up a lot of unproductive travel essentially waste street space, and they’re less profitable for drivers.
Alejandro Henao, a postdoctoral researcher with the National Renewable Energy Laboratory, illustrates what this looks like using data from RideAustin, a nonprofit ride-hailing service in Austin, Texas. When drivers don’t receive enough trip requests, they spend a lot of miles driving around without any passengers, contributing to congestion. As they receive more requests, those wasted miles decline.
Henao’s analysis suggests the optimal target, at least in Austin, occurs when drivers average 3.4 trip requests per hour. That translates to having about 30 drivers for every 100 trip requests there. Beyond that point, adding more trips per driver doesn’t save drivers — or the city — much in empty miles traveled with no passenger in the back. Beyond that point, the system would likely have too many passengers and not enough drivers, and passenger wait times would increase.
These numbers would differ in other cities or circumstances, including if you looked at only, say, downtown Austin. But the principle is the same anywhere, Henao argues: Cities should neither cap these services nor welcome a free-for-all. They should try to optimize the number of drivers to the amount of demand — or nudge companies to do that more effectively, by requiring them to share their utilization rates. Cities could withhold licenses from companies with low utilization, for instance, and reward those with high rates.
In New York, politicians have been reacting to the suspicion that ride-hailing companies have goosed the number of cars on the road to minimize wait times for passengers, at the expense of driver wages and public streets.
“The Uber business model,” Mayor Bill de Blasio said, is “flood the market with as many cars and drivers as possible.”
Uber and Lyft counter that they’re motivated to balance all of these interests — and certainly more so than the taxi industry has been. Both companies support an alternative policy in congestion pricing, a strategy that would manage the supply of all vehicles in crowded parts of Manhattan, rather than targeting the ride-hailing industry.
“Picking a number of vehicles is not the best way to serve residents across entire cities — just look at yellow taxis in NYC who do 92 percent of their trips in Manhattan,” Uber spokesman Josh Gold said in a statement. “Ultimately, we have a natural incentive to keep drivers busy; otherwise they won’t choose to continue driving with us.”
Capping ride-sharing vehicles won’t ease congestion, said Adrian Durbin, Lyft’s director of communications. And it will make it only harder for companies like Lyft to nudge more passengers into shared rides if they’re not able to match passengers efficiently. He points to people who live in neighborhoods that aren’t well served by transit or who need late-night rides.
“Those are the people who are going to be most harmed by caps or cuts to ride-sharing,” he said. “We weren’t just putting drivers on the road for the sake of it. It’s not good for our business or Uber’s to have drivers out there whose cars are empty most of the time.”
Lyft and Uber have not released data on their utilization in New York, although other provisions of the city’s legislation could require them to do so. That makes it harder to repeat Henao’s analysis with trip data in New York. But Schaller has made his own calculations. Cars for the two companies were used by passengers about 68 percent of the time in New York, excluding airport rides, he estimates for June 2017. Ideally, that number could be as high as 80 percent, he said.
Yellow cabs are less productive because they don’t use the same sophisticated dispatch system to pair drivers and riders citywide. For them, Schaller suggests, the sweet spot may be more like 55 percent in New York, and lower in less dense cities.
Research published this summer in the journal Nature by researchers at MIT suggests another possibility: If yellow cabs in New York could centrally optimize routes — more akin to what Uber and Lyft do — they could deliver the same number of rides with 30 to 40 percent fewer vehicles.
Technology has made it easier to identify and manage the optimal supply, far more so than when cities began capping taxis 80 years ago. But cities have to be clear what they’re optimizing for.
And in none of these proposed calculations would the city maximize the interests of the group financially hurt the most by Uber’s rise: taxi medallion owners, some of them immigrant drivers, who’ve seen the value of their assets plummet.
That is a trade-off, too.
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The best cap on Uber would be to fix the frigging subway
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