Drivers Set To Come Back To Platforms As Enhanced Unemployment Benefits Expire
With enhanced federal unemployment benefits expiring on September 6th, driver supply is likely to come roaring back. Former TLC Chair sees "Taximageddon"
With enhanced federal unemployment benefits expiring on September 6th, Uber and Lyft’s driver shortage problems may be coming to an end. In a recent and wide-ranging interview, Uber’s CEO Dara Khosrowshahi believes passengers fares will normalize by September (i.e., driver shortage issues will start to go away).
‘[Uber CEO Dara Khosrowshahi] said the company is leaning in and investing super-aggressively to bringing drivers back…[Uber’s CEO] predicted that by September, prices will return “to nearly the good old days”’ - NY Times
In fact, former NYC Taxi & Limousine (TLC) Chair Matthew Daus predicted back in June that while the summer months were likely to be pricey for rideshare passengers that he believed the dynamic would “crash to halt when the federal unemployment benefits expired in September”. Daus believes the ending of the additional benefits could actually result in the opposite of today’s status quo where there would be too many drivers/cars looking for too few passengers (even though the City would begin to reopen).
“I fear that there’s going to be a ton of vehicles in the streets searching for work and there’s not going to be enough work until the holidays at least…We’re going to have ‘taximageddon’ in the fall” - Matthew Daus, Former NYC Taxi & Limousine Chair
I think Daus might be right, which likely also further explains the recent decision by the TLC to pull the EV exemption to the FHV License Pause (aka ‘TLC Plate Cap’). The other side to enhanced unemployment benefits expiring, is people (read: passengers) will also have less money to spend, so may opt for more affordable public transport options vs. taxis/for-hire transport.
We are only about 1.5 months away from September 6th. It’ll be interesting to see how this all plays out. What do you think? Do you think a "Taximageddon" is going to happen?
AutoMarketplace NYC Newsletter is written by Dawood Mian, Founder & CEO of AutoMarketplace. He covers the NYC for-hire transportation industry and related news. Search AutoMarketplace for cars, parts, tires, technicians, body shops, reviews, jobs & more. Find great deals at TLCMKT.COM (new site AutoMarketplace.io to be launched soon, sign-up to the newsletter if you are interested to learn more ahead of launch)