Sunday, June 5, 2011

Screwing the livery cab drivers

Before I say anything more about taxis in New York, I should point out that I have a financial interest in this issue. I have a business relationship with a livery car service, and another business relationship with an insurance agent for livery cars. If they go out of business it could affect my income.

I should also point out that they're not very reliable customers, they're a small part of my income, and I don't feel much loyalty towards them. If I felt it were necessary to achieve my goals (listed above), I wouldn't hesitate to promote policies that could reduce or eliminate their ability to pay me. But I do know them, and I think that's something you should know.

The fact is, as I wrote a month ago, the availability of taxis does contribute towards our goals, as it complements the public transit system to provide a complete transportation solution. This is supported by a recent guest piece for the Urbanophile showing maps of taxi hail density in Boston. However, in order to be really convincing that map would have to show taxi hails per capita and per workstation, to control for population density.

In the comments to my last post, Stephen Smith asked, "But would legalizing outer borough livery hail really affect the price of medallions? If the numbers that I common hear recited are true – that only 3% of all medallion fares come from outside Manhattan below 96th and the airports – then they should experience a 3% drop in value, at most."

This is an excellent question, and it seems pretty clear that Stephen is right - the livery cabs are not a threat to the medallion owners. The other explanation is that the outer borough taxi hails are perceived by the medallion owners as a potential revenue source that the livery drivers are squatting on. The city is essentially asking for a $300 million bribe, and promising in return to drive the livery cabs out of the street-hail business so that the medallion cabs can take over.

The livery cab owners (and their insurance agents) are pretty mad about this, and are planning a rally for Monday. The plan needs to be approved by the State Legislature, and the livery owners are trying to get it modified. Will they succeed? Maybe, if it comes down to fairness. The livery cab owners have put in years of "sweat equity" picking up lower-income passengers. Why should the medallion owners get to muscle in, just because they have some extra cash?

The livery drivers will probably not succeed if it comes down to raw power: 22,000 middle-class Latinos and Pakistanis against the politically connected, financially endowed owners of 13,000 medallions. The outer-borough populist politicians have generally not bothered to say anything in support of the livery cab owners. The main exception is the Dominicans and Puerto Ricans. Some of them, like Assemblymember José Rivera, have actually driven livery cabs in the past.


NYC taxi photo said...

you're going to have to say more on how you feel the livery cab drivers feel they're being cheated.

Bloomberg introduced an idea that would give livery cabs more business by becoming more like medallion taxis, which would in turn give them even more credibility to be hailed illegally in parts of the city where they still can't be hailed. of course the plan was rejected because it would damage the value of a medallion which now costs btw 650,000 dollars and over a million dollars. paying for a medallion is paying for such permissions, and shouldn't be limited after such a contract is purchased.

also, my business on some days is 40% reliant on pick-ups on the street in Brooklyn and Queens. I do realize that the market doesn't allow for yellow cabs to be everywhere in the city and we do need another class of cabs which are cheaper to run so that a decent wage can be earned while serving the entire city. However I do not see what the livery drivers are complaining about.

NYC taxi photo said...

if you really think that the value of an outer borough hail only medallion would be worth a mere 50,000 dollars?????? in comparison with 650,000.

Than you can sign me up as the first scab to buy one of these and stop driving a yellow cab, it'd be a hell of a lot less stressful just to own a car and not have to search through manhattan traffic all day.

why is it that the people who do all the thinking never do all of the work?

Cap'n Transit said...

Taxi Photo, I understand that you're upset about this, but I'm not following what you're saying. Your individual business may be 40% reliant on Brooklyn and Queens, but the GPS data show that "97.5% of yellow taxi trips originate in Manhattan or at the airports."

The medallions guarantee a right to pick up street hails. They do not guarantee any limit to competition. The idea that the city has entered into binding contracts with 13,700 entities that will forever constrain its transportation policy is, frankly, ludicrous.

I think you should be able to switch to a less stressful job picking up passengers in Queens. But the current proposal from the City essentially shuts out most of the current livery car owners from the "borough taxis," because it would require the borough medallions to be bought as a package with a citywide medallion and three other borough medallions - $850,000 total at a minimum.