Venture: Uber vs. New York City's Taxi Industry


Since Uber's founding in 2009 by Travis Kalanick and Garrett Camp, the San Francisco-based company has become a leading name in the peer-to-peer ridesharing industry with numerous operations established worldwide. Some of the accomplishments that Uber have accumulated over the years include food deliveries from UberEats and having local and specialized services such as UberAuto, an auto rickshaw service that’s available in India and Pakistan, and introducing UberBoat, a water taxi service that’s primarily found in Istanbul and the coast of Croatia.

Uber has always been praised for providing qualified applicants an opportunity to drive for Uber as independent contractors, which can allow the drivers to have enough extra cash to support themselves and their families. Around the world on every street, boulevard, avenue, and even dirt road, cars with an Uber sticker placed on windshields are now regular sightings in people’s every day lives, especially when they need a quicker mode of transportation to get to their desired destination.

However, the ascendancy of Uber, as well as other ride-sharing companies such as India’s Ola, China’s Didi Chuxing, and it’s equally popular competitor, Lyft, has not gone well with people employed in traditional taxi companies. One particular example is the taxi industry in New York, which had seen five taxi cab drivers commit suicide in the first five months of 2018, particularly one driver who drowned himself by jumping into the East River after he was last seen on May 11.

Another tragic suicide committed by a taxi driver occurred in front of New York City’s City Hall on Feb. 5, 2018, as 61-year-old Doug Schifter shot himself in the face with a shotgun. Schifter had worked between 100-120 hours almost every week for over the past fourteen years and on his suicide note that he wrote shortly before committing suicide, he claimed that the politicians of New York City, specifically former Mayor Michael Bloomberg, current Mayor Bill de Blasio, current New York Governor Andrew Cuomo, had ruined his livelihood and “have each had their part in destroying a once thriving industry."

However, there is still plenty of support for Uber in New York City, especially in regards to employing drivers and picking up passengers of minority backgrounds. During a weekly rally in Harlem, Reverend Al Sharpton praised Uber for its service to minority communities who live on the outskirts of New York City and in response to the proposals on freezing the number of Uber licenses in the city, Sharpton said, "Do you know how difficult it is for black people to get a yellow cab in New York City? This isn’t about Uber. It’s about Us-ah. We need to stand up for us."

The proposals that Sharpton mentioned about were brought up by New York City Council as a way to curb the number of vehicles driving for Uber and other ride-sharing companies, which are believed to have increased the traffic congestion in New York City and led to a decrease in driver wages. As the largest U.S. market for Uber, having a 12-month freeze on new ride-sharing cars can stagnate Uber’s continuing growth and may influence other cities to implement similar proposals.

Al Sharpton’s support for Uber’s service to minority communities and disapproval of the proposed freeze on ride-sharing cars resonate well with black and Latino New Yorkers who have long-standing opinions of traditional, yellow-cab companies that sometimes don’t pick them up just because they’re from certain neighborhoods that are deemed as “dangerous." Uber and their main competitor Lyft have recently joined forces with civil rights groups such as the National Urban League and the NAACP to fight against the New York City Council’s proposed plan to put a cap on new ride-sharing cars. 

The fight against the City Council’s proposals is in reaction to the racial discrimination that New Yorkers of minority backgrounds have faced when trying to catch a ride from a yellow cab. The cap on the ride-sharing cars could have a significant impact on minority passengers as many have stated that yellow cabs refused to pick them up and drop them at their homes all because of the neighborhoods they reside in.

The current situation isn’t the only time that Uber has faced when it involves the legislation relating to ride-sharing services. The company had witnessed New York state legislature approving a new surcharge for ride-sharing services and taxis that drive into Manhattan, with ride-sharing services like Uber having to pay a surcharge of $2.75 and shared vehicles platforms such as UberPool being charged a $0.75 fee per customer.

Uber has also faced its fair share of disappointments over the past few years, including in London where last year, the city government had scrapped Uber’s operating license because it “demonstrated a lack of corporate responsibility in relation to a number of issues which have potential public safety and security implications”. Aside from London’s expected ban of Uber on October 1, the list of countries that have full or partial ban of Uber’s services include Bulgaria, which implemented a nationwide ban of Uber, Denmark, which has instead suspended Uber’s activities due to government regulations, and the ban of UberPop, Uber’s cheapest service, in France, Germany and Italy.

As of Aug. 8, 2018, the New York City Council passed legislation that limits the number of drivers from ride-sharing companies like Uber and Lyft from driving the streets of New York City, as well as allowing more regulators to pass restrictions in the upcoming months or years. This could lead to establishing a minimum wage for drivers and setting caps on the number of cars allowed on the streets. Among the restrictions is the aforementioned 12-month freeze on the issuance of new licenses for ride-share drivers, in which regulators from the Taxi and Limousine Commission will conduct studies on the ride-sharing industry, including how much drivers make, vehicle utilization rates and the impact of ride-sharing on traffic congestion.

Ever since Uber was created by the aforementioned Travis Kalanick and Garrett Camp, Uber has enhanced the reputation of the ride-sharing industry throughout the world when it comes to offering passengers an affordable mode of transportation, as well as providing job opportunities for applicants who simply want to continue putting food on their family’s dining table. Another thing that should be noted is that there should be more cooperation between ride-sharing companies like Uber and Lyft with local taxi cab companies so that there can communication between the two parties can be conducted efficiently and that ride-sharing and taxi cab drivers alike can share the streets without having to worry about losing customers and money.