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Taxi Owners Sue NYC Over Uber, While Court Overrules Class-Action Appeal (thestack.com)
An anonymous reader writes: Taxi owners in New York have filed a lawsuit against cab-hailing app giant Uber, citing damaged revenues and a hefty fall in value of NYC's 'medallion' business. The case against the city and its Taxi and Limousine Commission claims that the regulators have unfairly permitted Uber to steal away business from the regulated cab industry. Getting away without regulation has enabled Uber drivers to compete directly, and drown out official taxi companies. A further lawsuit case hovering over Uber this week, is its request to immediately appeal an order approving class certification filed by its own drivers. The appeal was denied by a U.S. court yesterday.
They are all god awful. People use uber partly because it is cheaper (is it even cheaper in NYC? I thought it cost more than a yellow cab there)...but they also use it because it is seamless, the cars are clean, and the drivers aren't smelly dudes yammering away on their phone. See the use of the more expensive "Uber Select" and "Uber Black" as proof that it is not just about undercutting the taxis.
Most NYC rides aren't dispatched anyways...they are flagged down on the street.
Bottles.
Uber is eating their lunch because cabs SUCK. I have no sympathy at all for those rent-seeking bastards.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
The main difference in the business models is that Taxi companies have to pay hundreds of thousands of dollars for a taxi license/plate/medallion, the supply of which has been artificially restricted by government regulation. This forces costs up for them and prices up for customers.
Given that this is specifically about NYC, which I've done a bit of study on, it's actually worse than you say. NYC taxis are some of the most highly controlled in the world. London's Black Taxis are up there too, but at least they require quality drivers. NYC, from my understanding, is much more concerned with the vehicle, medallion, and operating methods.
Peak price for the medallion was over $1M, and the loan using one as collateral ran roughly 10%. So the 'permit' to operate a taxi in NYC ran, as an opportunity cost, roughly $100k/year. Before the costs of the car, insurance, fuel, and driver. If you figure on 3 rides an hour, 24 hours day, 365 days a year(they hand off the permit to successive drivers in the company), that's 26k rides. Or the permit being $4 for every ride.
2014 factbook: 13,437 medallions, 485k per day. That's 36 rides per medallion(I was figuring 72, double theirs), which increases that to $8/ride. Though I think the value of medallions have dropped from their high, and interest rates are lower. $740k@7% is only $142 per day, or still around $4/ride. ;)
I don't read AC A human right
Look what Amazon has done to local retail in America - decimated it!
Dude, that was, in order:
(1) strip malls put individual storefronts out of business, and raised rents when they were gone
(2) shopping malls put many strip malls and individual storefronts out of business, and raised rents when they were gone
(3) Walmart put many "anchor stores" in shopping malls out of business, which then killed individual mall stores dependent on foot traffic, and killed many strip malls with limited varied compared to Walmart, and remaining storefronts, all by buying in bulk, undercutting prices (even if good had to be sold at a loss to do so), and then raising prices once the others were gone
It's all about driving down aggregate costs (which is one reason many places in California have ordinances on maximum store size: to keep Walmart out, or at least from realizing a high enough economy of scale to drive smaller stores out of business, because they are more or less the same size
Amazon was pretty much uninvolved with any of that.
I don't know much about Uber, I don't see how their model is different from a regular taxi. They both need to pick you up at your current location and then you need to tell them where to go.
I don't see how Uber knowing in advance where you want to go could change the outcome.
No, in fact it's the taxi drivers that usually have more information about rides than Uber drivers.
Once booked, an Uber car can not be flagged someone else, it can not hear about other people needing rides to other locations, and it can not make itself available for other tentative bookings. First in, first out. That's how it works. There is no inventory sitting in queues waiting midway to be processed (if you don't mind me using the metaphors of lean manufacturing).
In the case of a taxi however, even if they're using a taxi app, there is no guarantee that they're coming to pick you up, because someone else could flag them on the way, they may get a more attractive offer of someone needing a ride to the airport (instead of a five minutes ride), they may not like the color of your skin or the way you're dressed or the way you speak, and they're always trying to book their next ride before they're finished with their existing one.
In the case of Uber also, the inability to do double-booking is important, but it's not the only thing that makes the service better. Since the transaction goes through whether you're picked up or not, you better be there when the Uber driver shows up. And the Uber driver better pick you up, because otherwise he'll get a charge back on his account and he'll get a very bad customer rating on his profile (assuming the gps data from both phones do not contradict the story of the customer).
Not only that, but as a user using the Uber app, you're instantly reassured after ordering the Uber car, since you're seeing its dot immediately moving towards you. In the case of a taxi however, even if you were to pinpoint its real-time location on a map, you would probably see the dot moving away from you as it is trying to finish its last ride.
Combine that with the fact that the medaillon system is archaic and highly inflexible, it's no wonder medaillon holders are not happy. During peak hours, Uber drivers can come out of nowhere. Their marginal costs for Uber are constant. In the case of a medaillon holder however, during peak hours, he can't split his medaillon(s) in two. The most he can do is to force a rotation of drivers to use his medaillon 24 hours a day 7 days a week even during low peak hours, to make sure he squeezes out every penny that he can out of that medaillon (or medaillons) so he can try to recoup his investment. And that doesn't solve the problem, that in places like New York or San Francisco, there are not enough taxis during peak hours, so it's not even worth trying to get one during those times. So before services like Uber came along, people opted for public transportation if they could during peak hours, or they opted to bring in their own car, and paid outrageous amounts for parking.
The city is not getting $1m for each medallion. That's the artificial market created by middlemen trading in medallions.
I'm out of my mind right now, but feel free to leave a message.....
The "hard" option is to compete, and taxis can't do that. That'd be hard.
It would be easy to compete if they didn't have to obey the law. If the city would reimburse all of their sunk costs on Taxi medallions, remove the regulations which regulate the prices that taxis can charge and remove the insurance and inspection requirements, then taxis could easily compete with uber and due to their economies of scale, they could crush Uber. But unfortunately, Uber chooses to continue to operate without paying any attention to the rules which other companies in the same sector have to obey.
If you are not allowed to question your government then the government has answered your question.
I drove taxis 25yrs ago, we had computerised dispatch back then (with a dispatcher entering the data), all of them now have their own app where the user fills out their own details. The taxi dispatchers are there to answer the phones, the dispatch company is usually owned and operated as a co-op between the individual taxi owners. AFAIK Uber doesn't offer the "human on a phone" option, it's web form or nothing.
Since there are thousands of taxi owners paying for a few drones in a call center it is an insignificant part of the cost of running a taxi. By far the biggest cost of running a cab is maintenance, fuel, insurance, and the interest you pay on the loan you took out for the "medallion".
If hipsters want to change the law into a race to the bottom for owner-operators, then the first thing they must do is buy back those medallions at a fair price. People have worked their entire lives to pay for a single medallion, a bunch of parasites who believe the law doesn't apply to them are rapidly making them worthless.
And did you exchange a walk on part in the war for a lead role in a cage? - Pink Floyd.