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Uber, lyft and other taxis

Why Tensions Between Uber and Cities Peaked in NYC: QuickTake

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New York City dealt Uber Technologies Inc. a blow recently by halting new licenses and blocking the company from adding drivers in its largest U.S. market. It marked a turning point in the city’s relationship with digital ride-hailing services, which have flooded streets, compounded traffic and pushed taxi owners to a financial cliff. New York’s actions are the latest example of how city and national governments worldwide are trying to corral Uber after years of rules-be-damned growth under former managers. They also show how new Chief Executive Dara Khosrowshahi has tried to balance innovation with political diplomacy.

1. What did NYC do?
New York’s City Council in August passed legislation to freeze new ride-hailing licenses for a year while a task force figures out if more needs to be done to protect drivers and passengers. Wheelchair-accessible vehicles are exempt from the cap. The city’s Taxi & Limousine Commission can also set minimum pay standards for drivers of ride-hailing services. Requiring companies to make up the difference between that pay floor and a driver’s hourly earnings is intended to be an incentive for companies to keep the number of drivers down and balance the supply of ride services with demand.

2. What have other governments done?
Uber came close to being banned in London when regulators in 2017 didn’t renew Uber’s operating license, citing safety and governance shortcomings, such as failing to do proper background checks on drivers. Uber eventually won a 15-month probationary license in June after convincing a judge it had reset its management and culture. The European Union’s highest court also took action against Uber when it ruled in December that Uber is a transport company rather than a digital service provider, making it subject to each member nation’s own rules. Japan, Argentina and Germany have also made it difficult for the company to operate its ride-hailing business in those countries. In the U.S., Seattle passed a first-of-its-kind ordinance in 2015 allowing drivers-for-hire to collectively bargain, although that may now be in jeopardy: A U.S. appeals court in May let proceed an antitrust challenge brought by the U.S. Chamber of Commerce.

3. Why are they cracking down on Uber?
Consumers have embraced ride-hailing services such as Uber and Lyft Inc., leading to an explosion in drivers and vehicles that’s been tough on local governments. The sector has a history of trying to maneuver around regulations and entrenched taxi industries, making it ripe for a crackdown. In New York, app-based for-hire vehicles jumped to more than 80,000 from about 12,600 in January, 2015. The oversupply resulted in some 40 percent of cars traversing the city without passengers. The economic cost from traffic-choked midtown Manhattan streets has been calculated in the billions of dollars while competition has suppressed average pay to about $17 an hour. Six drivers committed suicide within seven months, citing their economic desperation and creating a public outcry that spurred the city council to act.

4. Is Uber as bad as some city officials say?
Uber and other app-based ride companies have won loyal users by offering inexpensive and convenient transportation, especially for people in areas ill-served by mass transit. The services represent a flexible gig for drivers. At the same time, Uber’s size and the allegations of misconduct against it have drawn plenty of scrutiny. Uber offices from Montreal to Hong Kong have been raided by authorities investigating various suspected wrongdoings by the company, employees, or both. It has also come under scrutiny by the U.S. Justice Department for possible violations of anti-bribery laws. Critics have pointed to these alleged misdeeds as evidence of a renegade corporate culture under co-founder and its former chief executive officer, Travis Kalanick, who was ousted amid allegations of discrimination and questionable business practices at the company.

5. Wasn’t Uber’s new CEO supposed to allay those fears?
Yes. After London officials moved to oust the company, he issued a contrite public apology that acknowledged the company had “got things wrong along the way.” Soon after, the company voluntarily suspended its UberPop service in Oslo, avoiding a conflict while the Norwegian government wrote new rules for app-based ride services. A London judge’s decision to grant the company a 15-month license rewarded the contrite approach taken by Khosrowshahi, who flew in for talks with the city’s transport officials just weeks after assuming the CEO role. He followed a similar playbook in New York by huddling with politicians over concerns about congestion and driver suicides, and even supporting a fee on ride-hail trips to help city cab drivers in dire financial straits.

6. How have Uber and other ride-apps affected traditional cabs?
Taxi drivers from South Africa to Canada have staged mass protests of ride-hailing services, Uber in particular. In New York, Uber first affected traditional cab drivers. But as the company grew, all for-hire drivers including limousine services, liveries and Uber drivers themselves saw business decline. New York’s Yellow Cab industry has been capped since former Mayor Fiorello LaGuardia in 1937 created a limited number of medallions when taxi supply increased faster than passenger demand. That strategy survived for 50 years, during which medallions became worth hundreds of thousands of dollars until Uber, Lyft and Via cars created new competition and drove taxi services into a financial crisis. Now, there are so many for-hire cars competing for passengers, few drivers in any part of the industry say they can make a living.

7. Are government actions hurting Uber’s bottom line?
Government regulation has long been a powerful constraint on Uber’s revenue growth, which has already started to slow. Across the world, Uber operates in a highly regulated industry and governments have the power to shut it down altogether, raise taxes, or restrict its footprint. A renewed push to limit Uber’s size in cities would further hinder the company’s revenue growth. For now, it’s hard to tell if the regulatory backlash in New York is anomalous or if it could trigger regulatory contagion globally. Expanding in existing markets is essential to maintaining growth ahead of a public offering next year. The regulatory backlash in New York City was particularly worrying for the company because the city has long been one of Uber’s most profitable markets.

8. What about an Uber IPO?
Increased regulation could hamper Uber’s financial performance, but it’s unlikely to derail Uber’s plans for a public offering in the second half of 2019. The company faces intense investor pressure to deliver on a public offering. Some shareholders would be freed up to sell their shares if Uber doesn’t go public on schedule. Whether Uber can recruit a chief financial officer and the state of the public markets will likely play a bigger role in the company’s IPO timing than government restrictions.

Source: https://www.bloomberg.com/news/articles/2018-08-20/why-tensions-between-uber-and-cities-peaked-in-nyc-quicktake

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Uber, lyft and other taxis

Uber and Lyft Drivers in Chicago Will Hold Rally to Protest Abuse and Low Wages

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Uber and Lyft drivers in Chicago will rally at O’Hare airport Monday in protest of abuses they have faced from riders as well as the low wages they receive from their work, the Chicago Sun-Times reported.

Organizers with the group Chicago Rideshare Advocates are working to organize the thousands of drivers across the city to demand better pay and working conditions. Last week the group rallied outside City Hall with a banner that read, “Uber/Lyft Stop Abusing Workers/Cities.”

Mattia Nanfria, a 41-year-old ride-share driver who also organizes with Chicago Rideshare Advocates said she has been propositioned and attacked by riders. She said that after reporting having problems with some riders, Uber didn’t seem to do much to address the issue. “For all I know, they did nothing, which is a little disturbing,” she said.
To make matters worse, Nanfria said there are some weeks when she makes less than the city’s minimum $12 hourly wage. “The weeks where I’m clearing $10 to $12 an hour, that’s what I lose sleep over,” Nanfria told the Sun-Times.

Chicago city officials have considered following New York’s lead and putting a cap on the number of ride-share vehicles in the city, which has quadrupled to nearly 66,000 drivers in the last three years, according to the Chicago Tribune. The Chicago Rideshare Associates are on board with capping the number of drivers, along with increasing wages and drivers’ safety.

“Nobody wants to ban Uber and Lyft. Nobody wants that,” Eli Martin, a co-organizer of Chicago Rideshare Advocates told the Sun-Times. “We all like this, we just have to make it work better.”
Both Uber and Lyft oppose the proposal for a license cap.

The surge in ride-sharing services in Chicago has hurt business for cab and taxi drivers, while also worsening working conditions for Uber and Lyft drivers.

Earlier this year, Uber’s CEO Dara Khosrowshahi suggested that New York City officials should impose a fee on ride-sharing apps to help taxi medallion owners facing financial burdens from the increase of ride-sharing services. But the New York Taxi Workers Alliance called the proposal “a slap in the face to struggling drivers and an attempt to get out of being regulated.”

Chicago officials have proposed raising the average wage for drivers, which is currently less than the minimum wage at $11.53 an hour after expenses.

The group will hold its rally at the O’Hare Transportation Network Providers’ parking lot from 7-10 p.m. on Monday.

Source: http://fortune.com/2018/09/16/uber-lyft-drivers-chicago-protest/

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More Than 100 Cars Damaged in NYC Mall Parking Garage Inferno; Suspect Arrested: NYPD

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Police have arrested a man in connection to a seven-alarm inferno that tore through a multi-level parking garage at Brooklyn’s Kings Plaza Shopping Center Monday, enveloping the entire area in thick smoke, engulfing more than 100 vehicles and leaving nearly two dozen people hurt.

Police say they’ve arrested Avon Stephens, 23, on an arson charge in the fire at a parking garage at the mall on Avenue U and Flatbush Avenue. A motive wasn’t clear, and details on an attorney for Stephens weren’t immediately available.
The fire call came in shortly before 9 a.m. Monday, and the blaze quickly escalated from a two-alarm to a four-alarm fire, then became a six-alarm inferno within an hour. By 11:15 a.m., it was a seven-alarm blaze. It was under control by noon.

Twenty-one people, 18 of them firefighters, suffered non-life-threatening injuries, mostly related to smoke inhalation and heat exhaustion. Four of the victims were taken to hospitals. Fire officials warned the patient total would likely rise.
A law enforcement source said 137 cars were damaged, and 70 of them were burned to their shells, many of them Mercedes.
The garage holds about 4,000 spaces and fire officials said 120 cars are normally stored there by a car dealership. There were some explosions from car tires burning; officials said there is no risk of collapse.

Citizen app video showed smoke spewing from the garage as bystanders crowded near emergency vehicles, seeking shelter from the shroud of smoke.
More than a half-dozen MTA bus lines were running with delays in the area because of the FDNY activity. The department said more than 200 of its members responded.

A mall spokesperson said to avoid the area until further notice. The plaza was closed, though officials said the fire did not extend to any stores.
Kings Plaza has more than 120 stores, including Macy’s, Best Buy, Sears, H&M, Michael Kors, Express and Foot Locker.

In 2013, it became the subject of a controversial order that temporarily banned people younger than 18 without the presence of an adult after hundreds of teens attacked patrons and vandalized the shopping center, forcing it to shut down.
No one was ultimately charged in that fray, nor was anyone hurt.

Source: https://www.nbcnewyork.com/news/local/Kings-Plaza-Brooklyn-Car-Fires-493470611.html

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Council moves ahead on bills to help taxis

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After years of failing to address the fallout from an upended taxi industry, the City Council is trying to make up for lost time.

Just a month after leading the way to an unprecedented one-year cap on Uber and Lyft vehicles, the council’s for-hire vehicle committee was back in action today with a hearing on nine more bills.

Overall they’re aimed at addressing the economic plight of roughly 6,000 individual taxi-medallion owners and the wider pool of taxi and ride-hail drivers, who now number more than 185,000, up from 30,000 six years ago. The push for more legislation has been fueled by six suicides in the past year by drivers who grew desperate because of their circumstances—and by a sense that the ride-hail industry has lost the ability it once had to block legislation it didn’t like.

The bills include an effort to establish a task force to study medallion values and recommend policies to increase prices and one to ask the Taxi and Limousine Commission to set up a program to provide drivers with health care and other insurance benefits.
If the bills pass, however, it remains unclear when they would bring relief, what form that relief would take and how it would be paid for. The health benefits proposal calls for adding a surcharge to all taxi and for-hire vehicle fares—which would be in addition to a congestion-pricing surcharge ($2.50 for cabs, $2.75 for app-based services) that will go into effect Jan. 1.

Taxi and Limousine Commission chair Meera Joshi, who testified in support of the bills, said it would be better to find a funding mechanism that didn’t antagonize passengers. The FHV committee chair, Ruben Diaz Sr., also spoke up against the surcharge.

The TLC, which will be developing the rules and carrying out the legislation, also will need to find out exactly what the health insurance needs are for the vast majority of drivers.

“That will be a painstaking study,” Joshi said.

Other bills are aimed at fighting predatory practices by car-leasing operators. They would require the TLC to set a cap on costs, ensure consumer-protection practices and prevent leasing operators from making automatic deductions from drivers’ earnings.

Some medallion owners who blame the TLC for allowing Uber and Lyft to flourish declared that the raft of new bills wouldn’t do much good if Joshi remained in charge of developing and enforcing the regulations.

“In our view, there can be no remedy if the remedy and the implementation are left up to the current TLC regime, which is [composed] of leftovers from the Bloomberg administration,” said Carolyn Protz, a medallion owner, who read from a letter from the Taxi Medallion Owner Driver Association.

Joshi was, in fact, appointed by Mayor Bill de Blasio, and much of the regulatory structure that determined Uber and Lyft’s place in the TLC universe was already in place when she started in May 2014.
In an email, Protz pointed out that Joshi was the TLC’s deputy counsel during the Bloomberg administration and that other senior TLC officials are also Bloomberg alumni.

Source: https://www.crainsnewyork.com/transportation/council-moves-ahead-bills-help-taxis

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