TNCs Squashing Taxi Industry in San Francisco



Transportation Network Companies (TNCs) Uber and Lyft have been locked in a gargantuan battle across San Francisco that has been so vicious it would give even Godzilla pause. Although the city’s buildings and bridges have remained intact, the same can’t be said of its festering taxi industry. Last week, the San Francisco Municipal Transportation Agency (SFMTA) reported that the average trips per taxicab in the city had declined from 1,424 a month in March 2012 to only 504 as of July 2014 — a nearly 65 percent reduction.

The taxi industry’s health “overall is being impacted clearly” by competing transportation network companies, according to Kate Toran, director of Taxis and Accessible Services for the SFMTA.

“There’s been a real reduction, but obviously this doesn’t tell the whole story,” Toran said. “Part of the story is we don’t have hard data yet from the [transportation network companies'] side to really analyze the full impact on the streets and our air quality.”

Toran has approached the California Public Utilities Commission (CPUC) about conducting a joint study with the SFMTA on the impacts of taxis and TNCs competing in the for-hire transportation industry. CPUC established the new business category in September 2013, and is responsible for regulating TNCs such as Uber and Lyft.

An oft-overlooked result of the rise of TNCs and decline of taxis is the increasing difficulty for those living with disabilities to find a ride. Although many taxi fleets require a certain number of accessible vehicles to be on the road at any given time, which can be dispatched by phone, TNCs currently have no such requirement. This has created accessibility issues for members of the disabled community trying to use Uber and Lyft. Granted, CPUC has mandated that TNCs develop an “Accessibility Plan,” including modifying apps so they “allow passengers to indicate their access needs,” among other things.

Lyft, Uber, Sidecar and two other TNCs filed disability-access plans with the CPUC, claiming they will guarantee drivers don’t discriminate against disabled customers. The companies said they already have or soon will make their apps and websites accessible to blind users, but maintained drivers can still determine whether or not to allow service animals in their vehicles.

A chief challenge facing TNCs as they strive to become more accessible to the disabled community is that they don’t physically own fleets of vehicles — they only provide the technology platforms that allow passengers and drivers to match themselves for a shared ride. Few Uber or Lyft drivers would be willing to go through the expensive and aesthetically disruptive process of modifying their personal vehicles for accessibility. The most realistic solution seems to be TNCs partnering with paratransit companies, which already have the proper vehicles and trained drivers to assist the disabled — but this is much easier said than done.

Toran reported that total wheelchair pickups by wheelchair-accessible taxis dropped from 1,378 per month in March 2013 to 768 per month this past July because it was difficult to get drivers to commit to the program that takes more time and money.

“The ramp taxi program is just a vulnerable program in the taxi program overall because it costs more to operate, maintain and it costs more in gas for the drivers,” she said. “It takes more time to do wheelchair securement, so it’s kind of the first to go.”

To incentivize drivers to join and stay in the taxi industry, the SFMTA waived dispatch renewal, color scheme renewal and driver application fees for fiscal year 2014-15, reduced some medallion-use and renewal fees and eliminated metal-plate fees. The agency is also exploring other ways to make taxi driving more financially attractive, such as reducing fees for medallions, which allow holders to operate taxis. Other ideas include reducing the fee to transfer medallions by 20 percent, eliminating the $500 ramp taxi medallion use fee, lowering the medallion renewal for transferrable medallion holders and allowing taxi wrap advertising.

All of this seems like the last desperate acts of a dying industry. As more and more consumers adopt smartphones and lead app-driven lives, they are going to be turning to apps to drive them. Taxi companies’ only hope for survival is to accept that times have changed and adapt to new technology — a good start would be joining up with companies such as FlyWheel, which uses Uber and Lyft-like technology to connect users to taxis via their smartphones.

As TNCs continue their fight for the hearts and minds of today’s tech savvy consumers, they must not forget that when you disrupt the status quo, many of the responsibilities fall onto you — legally mandated or not.


About Mike Hower

Mike Hower is a writer, thinker, and strategic communicator most interested in the intersection of sustainable business and policy. Currently based in Washington, D.C., he is a graduate research fellow at The George Washington University, where he is pursing a masters degree in Media & Public Affairs and researching the impact of Information Communication Technologies (ICTs) on sustainable development. He is hopelessly addicted to travel and has a borderline unhealthy obsession with his golden retriever, Gerico.
Posted in: Society
  • Dean Clark

    If the taxi industry was not so corrupt these issues would not exist. Taxi companies state when you apply to drive for them, that they are not hiring. Luxor, National, and Desoto cab will not hire a taxi driver if the taxi driver was hit by an uninsured motorist and the driver had to file a workers compensation claim. I know this because I applied. Why Director of taxi services are taxi companies not required to have uninsured motorist? Why are you allowing this type of activity to happen? It is not just about rideshares entering the market, your own taxi companies are discriminating and breaking laws themselves and the city does nothing about it!