AutoMarketplace founder Dawood Mian explains why Uber is limiting access to its NYC drivers app, what the TLC can do and what we believe drivers should ask for
Do you work "full-time" (i.e., 40+ hours per week) on Uber / Lyft? To be honest, for part-timers (i.e. less than 15-20 hours per week) it might start getting difficult.
Thank you Automarketplace for allowing me not only to comment but also being part of a friendly debate of ideas here in the comment section. Your insights about the industry are always accurate and there's no possible way that we can't learn something new or be on top of the news about the industry while reading your articles, it's an honor to feel that everybody has a voice among the well respected NYC TAXI industry. Once again, thanks.
Thank you for commenting and taking the time to share your opinions! The whole point of this publication is, in many ways, to promote information sharing and debate (the TLC industry desperately needs this, as we all know). If people feel comfortable sharing their thoughts, even if it's disagreeing with our own opinion, we think that's great! Interestingly, the data also shows its good for overall engagement levels. Hopefully we'll see you in the comments section again soon 👍
One of the main reasons i believe Yellow collapsed when Uber enter the market was mainly because there wasn’t enuf cabs to satisfied the demand but I understand that medallion owners didn’t want more medallions added but that bit them in the behind because here came Uber and added 100k vehicles which took most of Yellow cabs passengers.
What many people don’t understand is that the passenger pool is the same, one is street hail and the other e-hail but essentially its the same.
The medallion is not worth what is once was because Yellow isn’t doing anything special anymore.
Let me ask u a question, if FHV plates were sellable would a driver buy a FHV plate or would they buy a Medallion?
At this point unfortunately i believe the Yellow medallion will turn into the Green cab permit unless the city shifts the tide toward Yellow but time and time again we have seen that the city is not interested.
Great points and re-telling of history from someone who lived it. The taxi medallion industry got too greedy with limiting supply. This is a very interesting question you posed - "Let me ask u a question, if FHV plates were sellable would a driver buy a FHV plate or would they buy a Medallion?" - gut is they will buy the cheaper TLC plates, but only issue is if Uber or Lyft deactivates a driver the TLC plate isn't worth that much. The pitch taxi medallion owners can make now is "no one can deactivate you" (you own a part of the franchise). Another sneaky thing slipping under the radar which we will cover soon is yellow cabs being dispatched by Uber are not subject to UR! (as you might know)
To tell you the truth, there are so many options with FHV as opposed to Yellow and also Yellow is limited to Manhattan and airports.
Uber and lyft are not the only options, i understand that they control 80% of the market but I can still make a better living than in Yellow even without uber and lyft.
Obviously yellow still has a market but that vehicle supply needs to be reduced, even at a lower 9k active Yellow it is not low enough for the drivers to make a decent living.
Just to add 80% of the market, excluding yellow cab trips. In terms of just "traditional" black, livery, lux limo bases Uber/Lyft actually control 90%+ of that market at this point. It's kindof crazy. Agee with you though, non-taxi FHVs have a lot of options and is still generally preferred
While i definitely support the idea of limiting vehicle and also TLC driver licenses supply, but i look at this as a long term plan that the Taxi and Limousine Commission should’ve consider to start long time ago, a process like this can take years while in the works. As far of completely removing the Utilization rule i totally disagree with and here are my reasons;
Even if let’s say we have limited supply of drivers (Tlc licenses) and vehicle licenses there is a big group of this drivers that the only reason they are in the business is because they want to drive for uber or lyft, because they have waitlists all these drivers are waiting while driving for NEMT’s or livery bases in the meantime with the hope they can sign up for uber at some point, even at a point where theres no more drivers to hire the amount of total drivers will be too many, but to be honest i don’t know if this is what TLC wants to do as a short or long term solution since one of the reasons they keep it the way it is its because “drivers constantly get in and out of the industry”.
Plain and simple from my perspective while respecting Automarketplace’s opinion if TLC gets rid of the utilization rule just like that every single driver that’s on uber and lyft waitlists will be signed up with the apps and all we going to have left is a higher mile and minute rates than other markets, but the amount of drivers is going to be higher than the riders demand, unless the same goes way above pre-pandemic levels which is most likely not to happened as fast as statistics show. As you cited there’s other consequences such as leasing prices going up, etc.
Realistically speaking a quick solution to this nightmare it’s on TLC’s hands to find a legal way to enforce utilization rule the right way,(because if we are honest uber lockouts means drivers are definitely not making the same amount money because they are being limited but they are trying to be online and even if it does looks like uber is keeping the drivers busy those numbers are being manipulated and there should be consequences to that because there is a rule in place). At this point they cant just do everything Uber wants because that would bring consequences as you have previously stated, if anything they have already change the UR floor from 56% to 53% most likely as per Uber request to prevent this lockouts. Wether Uber has a point or not as far of the UR being industrywide altogether with Lyft, TLC should not let them use the “Divide and conquer” method and lockout drivers while they figure out their disagreements with TLC rules and in the process mess with the drivers livelihood and pay.
Thanks for the very thoughtful commentary. Some additional thoughts.
- Agree, at this very moment, with clear driver/vehicle supply oversaturation, the initial period of *no UR* might be tough on driver earnings. Perhaps getting rid of UR is done in phases, but the long term goal must be to more effectively control the supply side of the market (note: TLC will have a lever to pull, if supply is too low as well). The supply / demand of the market needs to be brought back into equilibrium quickly at this point, in our opinion (TLC can't control demand directly, but supply they can). Also, imagine if the economy starts slowing., demand might start to fall
- Another, more technical point re. UR, is any new company that passes the 10,000 trip per day threshold will almost immediately go out of business because it'll be near impossible for them to keep an "any TLC driver can sign-up" dynamic, abiding by the HV UR floors only a much larger Uber can pull off and then Uber will argue the "new" Company is dragging down industrywide UR so Uber has to do more lockouts. This is a core reason why Juno couldn't survive NYC and why Revel will have a hard time growing / surviving (not its infrastructure business, but its rides business). UR is creating this paradigm where Uber is getting more entrenched as the monopoly player.
- Eliminate cross-base dispatching: "All these drivers are waiting while driving for NEMT’s or livery bases in the meantime". We're not promoting this idea, but it would address this concern. In order to work for a "traditional" base, a driver has to essentially choose to work for a HV or non-HV base though. It will take away driver options to work (seems like Uber might do this anyway re. asking all its drivers to get HVFHS base affiliations). The traditional black car, livery & luxury limo sectors will suffer, but then a "new normal" will be reached.
Just some additional thoughts for you to consider 👍
Definitely agree with some of the points you guys and @Lenny have brought up, totally agree, the problem here will be the time to adjust to the no UR, but also no UR means uber and lyft will let every single driver on the wait list to join no exception and will encourage others to do so as well meaning driver will earn way less, the market will more oversaturated even if not one more licensee is allowed to enter the business and the only way to overcome that is with demand which we all know that grows very slow year over year.
Removing the UR without protecting minimum pay rules all it will do is remove the lockouts but create a bigger problem.
Eliminating cross app dispatching will be a total disaster in my opinion.
As far of the the whole industry being monopolize by just Uber I totally get your point but if UR was enforced the right way since the beginning uber and also lyft would've just hired the amount of drivers needed to service the demand as it grows, which also would've made sure both companies stay alive in the business, somehow this companies need to understand that on strictly regulated market like NYC there's only a certain amount of money you will be able to make and that the rest is going to go to expenses (such as driver pay) and that you have two options in order to do business in markets like NYC you either decide to be greedy and exit the same door you came in through or do business by following regulations, again if TLC would've not been flexible with certain things since the beginning NONE of these companies will do business like there's always a way around these regulations,
Note if there is a vehicle cap in place as well then Uber / Lyft can't take everyone off the waitlist because there are only X amount of vehicles if you will. So, they'll be a limit. In your opinion, what is the right way to enforce UR to avoid its negative impacts?
Again I agree with the caps but that seems to be the long term solution, enforcing the UR in my opinion will be by modifying the rule while specifically prohibiting data manipulation from the apps because in fact that's what lockouts exactly are, if the UR floor has to be dropped to 50% industrywide (which might be easier for the apps to achieve if they commit to not hiring drivers unless is strictly needed) it will not affect driver pay as much and ultimately it will give the TLC time to work on the caps and every negative aspect that removing the UR could bring later on, once the caps and everything else is under control we can get rid of the UR.
Does this show favoritism towards the apps? Yes but also towards the drivers if it wants to be seen that way.
That will offer a solution to the current situation and a plan to fix the issue once and for all.
Even if TLC is not interested in a short and long term solution to the problem let's hope the lockouts don't bring any other issues that may arise by limiting times online ( they might have thought of that already but even though we are two years ahead of the green rides initiative neither TLC or the City will like that percentage goes not even a 0.5 percent down) but what do I know? time will tell.
If they eliminate cross base dispatch will destroy most of us. I currently work for 6 bases, if i had to only pick one my income will immediately be cut in half.
The market is so saturated that if the TLC truly enforced the UR then Uber and lyft would leave the market because they won’t be able to pay the higher rates to all the drivers. Same way JUNO went bankrupt shortly after the UR was implemented in 2019
The data is there and they should use it in order to be able to know exactly how many drivers they need without exceeding it except for when drivers get deactivated permanently, simply exit the business or decide they want to drive for NEMTs or livery bases instead, the data it's enough for them to be able to forecast what the demand is and will be and when they should let drivers in and when not to, and lyft should follow that as well, That being said they will have two options they either continue to be greedy or just go, other than using the "screw the drivers si TLC can make things better" option. If anything they will adjust accordingly they'll do whatever it takes to stay, a 70%+ market share in a city with a lot of purchase power, even lyft with way less market share will think about it twice.
I would like to know what I am going to do to pay for my car and my insurance if I can't work this is not good for anyone.
Do you work "full-time" (i.e., 40+ hours per week) on Uber / Lyft? To be honest, for part-timers (i.e. less than 15-20 hours per week) it might start getting difficult.
Thank you Automarketplace for allowing me not only to comment but also being part of a friendly debate of ideas here in the comment section. Your insights about the industry are always accurate and there's no possible way that we can't learn something new or be on top of the news about the industry while reading your articles, it's an honor to feel that everybody has a voice among the well respected NYC TAXI industry. Once again, thanks.
Thank you for commenting and taking the time to share your opinions! The whole point of this publication is, in many ways, to promote information sharing and debate (the TLC industry desperately needs this, as we all know). If people feel comfortable sharing their thoughts, even if it's disagreeing with our own opinion, we think that's great! Interestingly, the data also shows its good for overall engagement levels. Hopefully we'll see you in the comments section again soon 👍
Definitely will, thanks again!
One of the best info on the lock out situation
Which ever way you look at this,it's always the driver that suffers
Unfortunately the UR formula was created to help the drivers and unfortunately it has been the opposite
Do you think they should change the UR formula? If yes, in what way? How would you go about this right now?
One of the main reasons i believe Yellow collapsed when Uber enter the market was mainly because there wasn’t enuf cabs to satisfied the demand but I understand that medallion owners didn’t want more medallions added but that bit them in the behind because here came Uber and added 100k vehicles which took most of Yellow cabs passengers.
What many people don’t understand is that the passenger pool is the same, one is street hail and the other e-hail but essentially its the same.
The medallion is not worth what is once was because Yellow isn’t doing anything special anymore.
Let me ask u a question, if FHV plates were sellable would a driver buy a FHV plate or would they buy a Medallion?
At this point unfortunately i believe the Yellow medallion will turn into the Green cab permit unless the city shifts the tide toward Yellow but time and time again we have seen that the city is not interested.
Great points and re-telling of history from someone who lived it. The taxi medallion industry got too greedy with limiting supply. This is a very interesting question you posed - "Let me ask u a question, if FHV plates were sellable would a driver buy a FHV plate or would they buy a Medallion?" - gut is they will buy the cheaper TLC plates, but only issue is if Uber or Lyft deactivates a driver the TLC plate isn't worth that much. The pitch taxi medallion owners can make now is "no one can deactivate you" (you own a part of the franchise). Another sneaky thing slipping under the radar which we will cover soon is yellow cabs being dispatched by Uber are not subject to UR! (as you might know)
To tell you the truth, there are so many options with FHV as opposed to Yellow and also Yellow is limited to Manhattan and airports.
Uber and lyft are not the only options, i understand that they control 80% of the market but I can still make a better living than in Yellow even without uber and lyft.
Obviously yellow still has a market but that vehicle supply needs to be reduced, even at a lower 9k active Yellow it is not low enough for the drivers to make a decent living.
Just to add 80% of the market, excluding yellow cab trips. In terms of just "traditional" black, livery, lux limo bases Uber/Lyft actually control 90%+ of that market at this point. It's kindof crazy. Agee with you though, non-taxi FHVs have a lot of options and is still generally preferred
I completely agree with most of your points; eliminate UR and limit plates and TLC licenses.
First off the TLC needs to come up with a good number of FHV like was done with Yellow medallions (~13k).
While i definitely support the idea of limiting vehicle and also TLC driver licenses supply, but i look at this as a long term plan that the Taxi and Limousine Commission should’ve consider to start long time ago, a process like this can take years while in the works. As far of completely removing the Utilization rule i totally disagree with and here are my reasons;
Even if let’s say we have limited supply of drivers (Tlc licenses) and vehicle licenses there is a big group of this drivers that the only reason they are in the business is because they want to drive for uber or lyft, because they have waitlists all these drivers are waiting while driving for NEMT’s or livery bases in the meantime with the hope they can sign up for uber at some point, even at a point where theres no more drivers to hire the amount of total drivers will be too many, but to be honest i don’t know if this is what TLC wants to do as a short or long term solution since one of the reasons they keep it the way it is its because “drivers constantly get in and out of the industry”.
Plain and simple from my perspective while respecting Automarketplace’s opinion if TLC gets rid of the utilization rule just like that every single driver that’s on uber and lyft waitlists will be signed up with the apps and all we going to have left is a higher mile and minute rates than other markets, but the amount of drivers is going to be higher than the riders demand, unless the same goes way above pre-pandemic levels which is most likely not to happened as fast as statistics show. As you cited there’s other consequences such as leasing prices going up, etc.
Realistically speaking a quick solution to this nightmare it’s on TLC’s hands to find a legal way to enforce utilization rule the right way,(because if we are honest uber lockouts means drivers are definitely not making the same amount money because they are being limited but they are trying to be online and even if it does looks like uber is keeping the drivers busy those numbers are being manipulated and there should be consequences to that because there is a rule in place). At this point they cant just do everything Uber wants because that would bring consequences as you have previously stated, if anything they have already change the UR floor from 56% to 53% most likely as per Uber request to prevent this lockouts. Wether Uber has a point or not as far of the UR being industrywide altogether with Lyft, TLC should not let them use the “Divide and conquer” method and lockout drivers while they figure out their disagreements with TLC rules and in the process mess with the drivers livelihood and pay.
Thanks for the very thoughtful commentary. Some additional thoughts.
- Agree, at this very moment, with clear driver/vehicle supply oversaturation, the initial period of *no UR* might be tough on driver earnings. Perhaps getting rid of UR is done in phases, but the long term goal must be to more effectively control the supply side of the market (note: TLC will have a lever to pull, if supply is too low as well). The supply / demand of the market needs to be brought back into equilibrium quickly at this point, in our opinion (TLC can't control demand directly, but supply they can). Also, imagine if the economy starts slowing., demand might start to fall
- Another, more technical point re. UR, is any new company that passes the 10,000 trip per day threshold will almost immediately go out of business because it'll be near impossible for them to keep an "any TLC driver can sign-up" dynamic, abiding by the HV UR floors only a much larger Uber can pull off and then Uber will argue the "new" Company is dragging down industrywide UR so Uber has to do more lockouts. This is a core reason why Juno couldn't survive NYC and why Revel will have a hard time growing / surviving (not its infrastructure business, but its rides business). UR is creating this paradigm where Uber is getting more entrenched as the monopoly player.
- Eliminate cross-base dispatching: "All these drivers are waiting while driving for NEMT’s or livery bases in the meantime". We're not promoting this idea, but it would address this concern. In order to work for a "traditional" base, a driver has to essentially choose to work for a HV or non-HV base though. It will take away driver options to work (seems like Uber might do this anyway re. asking all its drivers to get HVFHS base affiliations). The traditional black car, livery & luxury limo sectors will suffer, but then a "new normal" will be reached.
Just some additional thoughts for you to consider 👍
Definitely agree with some of the points you guys and @Lenny have brought up, totally agree, the problem here will be the time to adjust to the no UR, but also no UR means uber and lyft will let every single driver on the wait list to join no exception and will encourage others to do so as well meaning driver will earn way less, the market will more oversaturated even if not one more licensee is allowed to enter the business and the only way to overcome that is with demand which we all know that grows very slow year over year.
Removing the UR without protecting minimum pay rules all it will do is remove the lockouts but create a bigger problem.
Eliminating cross app dispatching will be a total disaster in my opinion.
As far of the the whole industry being monopolize by just Uber I totally get your point but if UR was enforced the right way since the beginning uber and also lyft would've just hired the amount of drivers needed to service the demand as it grows, which also would've made sure both companies stay alive in the business, somehow this companies need to understand that on strictly regulated market like NYC there's only a certain amount of money you will be able to make and that the rest is going to go to expenses (such as driver pay) and that you have two options in order to do business in markets like NYC you either decide to be greedy and exit the same door you came in through or do business by following regulations, again if TLC would've not been flexible with certain things since the beginning NONE of these companies will do business like there's always a way around these regulations,
Note if there is a vehicle cap in place as well then Uber / Lyft can't take everyone off the waitlist because there are only X amount of vehicles if you will. So, they'll be a limit. In your opinion, what is the right way to enforce UR to avoid its negative impacts?
Again I agree with the caps but that seems to be the long term solution, enforcing the UR in my opinion will be by modifying the rule while specifically prohibiting data manipulation from the apps because in fact that's what lockouts exactly are, if the UR floor has to be dropped to 50% industrywide (which might be easier for the apps to achieve if they commit to not hiring drivers unless is strictly needed) it will not affect driver pay as much and ultimately it will give the TLC time to work on the caps and every negative aspect that removing the UR could bring later on, once the caps and everything else is under control we can get rid of the UR.
Does this show favoritism towards the apps? Yes but also towards the drivers if it wants to be seen that way.
That will offer a solution to the current situation and a plan to fix the issue once and for all.
Even if TLC is not interested in a short and long term solution to the problem let's hope the lockouts don't bring any other issues that may arise by limiting times online ( they might have thought of that already but even though we are two years ahead of the green rides initiative neither TLC or the City will like that percentage goes not even a 0.5 percent down) but what do I know? time will tell.
The cap is too high
If they eliminate cross base dispatch will destroy most of us. I currently work for 6 bases, if i had to only pick one my income will immediately be cut in half.
Agree, wouldn't be in favor of cross base dispatching being eliminated
The market is so saturated that if the TLC truly enforced the UR then Uber and lyft would leave the market because they won’t be able to pay the higher rates to all the drivers. Same way JUNO went bankrupt shortly after the UR was implemented in 2019
The data is there and they should use it in order to be able to know exactly how many drivers they need without exceeding it except for when drivers get deactivated permanently, simply exit the business or decide they want to drive for NEMTs or livery bases instead, the data it's enough for them to be able to forecast what the demand is and will be and when they should let drivers in and when not to, and lyft should follow that as well, That being said they will have two options they either continue to be greedy or just go, other than using the "screw the drivers si TLC can make things better" option. If anything they will adjust accordingly they'll do whatever it takes to stay, a 70%+ market share in a city with a lot of purchase power, even lyft with way less market share will think about it twice.