⚡💾 Uber Sharing Data With Tesla To Understand NYC TLC Drivers Charging Needs
Reports of long EV charging waiting lines increasing, as more EVs from exemption reinstatement come online. Uber is partnering with Tesla to work on EV affordability & NYC EV charging infrastructure
Uber has begun to share TLC driver data with Tesla, with aim of understanding where drivers need charging infrastructure
Tesla, similar to overall US EV market, has a dominant electric vehicle (EV) market share among NYC TLC drivers
Many drivers bought EVs, although they know NYC charging infrastructure is lacking, related to TLC Plate “speculation”
TLC drivers that have access to overnight charging are at significant competitive advantage vs. drivers that rely on “fast charging” stations
Uber/Tesla information sharing might flag Teslas being commercially used, voiding warranties & potentially limiting full access to Supercharger network
Reuters reported yesterday that, starting with New York City, Uber has begun sharing data with Tesla to help determine where drivers need charging infrastructure. Uber is also offering drivers purchase incentives of up to $2,000 for Tesla's Model 3 and Model Y (this is separate from existing federal tax credits).
"We know from listening to Uber drivers that the cost of ownership and access to convenient charging are the top two barriers preventing them from going electric, and we are...(working with) Tesla to tackle both of these issues…"
- Andrew Macdonald, senior vice president of mobility and business operations at Uber
Given, Tesla has very dominant electric vehicle (EV) market share among NYC TLC drivers and fleets, this is a noteworthy development.
EV Charging Lines
As was easily predictable, adding thousands of TLC-plated electric vehicles (EVs) suddenly, was going to overwhelm current NYC charging infrastructure. As many industry participants know, most TLC-licensed drivers park on the street and/or do not have access to a garage/street charger overnight. As some of the ~10,000 new EV TLC Plates become active, driver social media pages have been filled with posts about long EV charging waiting lines across the City.
The TLC is also trying to help drivers find places to charge, creating a helpful frequently asked question (FAQ) page on its website, answering common questions, including where to find chargers.
In addition, TLC recently highlighted Revel’s two charging “Superhubs” located in Long Island City and Williamsburg.
Some Thoughts
We’re going to go on a bit of an EV side road, before returning to the main topic of NYC EV charging infrastructure and Uber sharing TLC-licensed driver information with Tesla. We’ll try to keep the tangent limited in scope, but we think it provides importance context to the NYC EV charging infrastructure discussion and drivers choosing to adopt EVs in the first place, when clearly the City’s current charging infrastructure is woefully inadequate.
In the fleet we still run (less than 25 vehicles), we had one driver leave us when the EV For-Hire Vehicle License (EV FHV License or EV TLC Plates) exemption was reinstated on October 18th, before an (ongoing) New York Taxi Workers Alliance (NYTWA) lawsuit temporarily stopped the reinstatement on November 13th.
We have fairly open, strong relationships with all of our fleet customers, so while we were sad to see the driver leave us, we wished him well and took the opportunity to speak with him. We wanted to make sure we didn’t mess up and understand why he decided to leave.
Notably, this specific driver had a paid off vehicle and was only renting the FHV License from our fleet business for $125 per week. This practice is commonly known as a “TLC Plate Rental”, similar to a Driver-Owned Vehicle (DOV) arrangement in the taxi medallion industry. This arrangement gave the driver the ability to use his own paid off vehicle, which was saving him a lot of money vs. being forced to rent a vehicle that he didn’t or couldn’t own.
We mention this because for him to decide to switch out of a very cost effective TLC Plate Rental arrangement where he had a paid off vehicle, to purchasing a ~$50,000 EV with a new loan, was confusing but, as we assumed, driven by the driver attaching value to “owning” a TLC Plate (FHV License). In fact, this is what he essentially told us. His decision to switch to an EV was not really driven by him wanting to switch to an EV or him believing the necessary EV charging infrastructure exists, but was more related to essentially TLC Plate “speculation”. This is what’s causing unnatural EV adoption among NYC TLC-licensed drivers, which might confuse someone analyzing the market from the outside-in.
If you look at popular TLC-focused Facebook groups, there are several new TLC-plated EVs, owned by individuals, that are already being marketed to lease (how did the regulator not understand this was going to happen?). The TLC, unintentionally, promoted TLC plate “speculation” by many individual drivers, who simply acquired vehicles (w/ TLC plates), to then immediately rent them out.
We’ve run a small/medium-sized TLC fleet for over six years, providing value to our customers and can tell you many of these “get rich quick” TLC Plate speculators will likely not be able to run a profitable mini-rental business with $50,000+ EVs. Many will actually lose their TLC Plates when they can’t keep up with their insurance payments, have to deal with an accident without comp & collision insurance or can’t get insurance in general (many other reasons as well). Our guess is some might even default on their auto loans.
Running a TLC leasing company, contrary to what TLC Chair David Do thinks, is a pretty difficult business that is capital intensive and has volatile margins, especially when you don’t have scale (50 to 100+ vehicles, at least). For example, Hertz, with its immense resources and fleet expertise, is having issues figuring out how to profitably rent EVs to rideshare drivers. Hertz! This is also why our own fleet business focuses on the niche, Uber Black (luxury vehicle) market as well.
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Also, to be clear, an FHV License (TLC Plate) attached to an individual’s name cannot be transferred (sold), but can technically be leased (vehicle / TLC Plate) to another driver (“peer-to-peer” rental). So, while some TLC-licensed drivers believe no leasing industry should exist, some are, in many ways, betting on extracting value from their TLC Plate by eventually leasing it out to other drivers who can’t access their own TLC Plate. Think about what we’re saying. 🤔
When we started our fleet business in late 2016, there was no TLC Plate Cap and as we’ve stated several times we fully support instituting FHV Lease Caps to keep a check on any and all abusive leasing companies or practices AND we believe a mechanism to re-issue or auction retired (“handed-in”) TLC Plates should be created so long-time TLC-licensed drivers can get out of leasing arrangements, predatory or otherwise.
NYTWA attorney Zubin D. Soleimany eloquently stated the same point we are trying to make above to New York State Supreme Court Judge J. Machelle Sweeting, before she granted NYTWA a temporary restraining order (TRO) related to TLC’s shock decision to reinstate the EV exemption to the TLC Plate Cap (FHV License Pause).
“You know, Ms. Selvin [City/TLC Attorney] is talking about owners leasing charges. Petitioner, Taxi Workers Alliance, has repeatedly and formally asked TLC to promulgate rules regulating the charges of leasing of for-hire vehicles, of getting rid of onerous charges. They do it for yellow cabs. You can only pay so much for a yellow Toyota Camry every week. They've refused after repeated entreaties and petitions for rulemaking to do the same for the for-hire vehicle side of the sector.
So to blow up the cap and allow tens of thousands of vehicles to flood the street because some drivers have been paying onerous leasing costs it's like tearing down your house because the roof leaks, you know, patch the leak.”
- NYTWA attorney Zubin Soleimany, Court transcript pg. 32 (EXHIBIT(S) - I (Motion #001) Oral Argument Transcript)
We specifically support a “re-issuance” mechanism vs. a “new issuance” policy because it doesn’t add more vehicles to the City’s for-hire vehicle fleet. This, we believe, reduces negative impacts on overall driver earnings and also addresses valid congestion concerns. Importantly, limited re-issuance vs. new issuance promotes a healthy yellow taxi medallion market. Finally, if a TLC driver chooses to purchase an EV when they have an option to purchase another vehicle type (i.e., hybrid) with a re-issued TLC Plate, that could be seen as more organic EV adoption (vs. forced or related to speculation).
Getting back to our former fleet customer. Here are some high level insights about his EV purchase.
Purchased a Volkswagen ID4
Paid ~$50,000 all-in (downpayment undisclosed)
$800+ monthly car payment (5-year loan at 6.99% APR)
$300+ liability-only monthly insurance premium
DID NOT purchase comprehensive & collision coverage
Note: if lender found out, they would force driver to get this coverage or he would likely be in violation of his loan terms. This ‘comp & collision’ coverage would likely be ~$300 per month in year 1
⚡ Installed charger in driveway he has access to (next to a house) for ~$3,500
We think the last bullet point is key. The driver figured out how to gain access to a overnight charger where he lives, which would solve the waiting line issue many other TLC-licensed drivers are currently facing (Note: “owning” the TLC Plate was still his primary motivator). As previously stated, since most drivers in NYC cannot practically have that arrangement, they rely on charging stations or hubs. It therefore makes sense Uber would work with Tesla to promote building out more NYC-based EV chargers.
Another quick note to mention, the current cold weather spell across the Northeast and Midwest, is also impacting the range of many EVs as the New York Times recently reported. The article actually quotes an Uber driver based in Chicago and the problems he’s facing with his EV. Many of these problems are likely similar to what NYC TLC drivers, who own EVs, are currently facing.
“When it’s cold like this, cars aren’t functioning well, chargers aren’t functioning well, and people don’t function so well either,” said Javed Spencer, an Uber driver who said he had done little else in the last three days besides charge his rented Chevy Bolt and worry about being stranded with a dead battery — again…
Mr. Spencer, the Uber driver, said the economics of driving an E.V. for a ride-sharing service may not work in Chicago winters…‘The payout is the same, but the cost to drivers, with all these extra charges, is much more,’ he said.’”
- NY Times, Electric Car Owners Confront a Harsh Foe: Cold Weather by Emily Schmall and Jenny Gross (Jan. 17, 2024)
Uber NYC & Tesla Working Together
Uber sharing data with Tesla about its NYC TLC drivers might have some unintended consequences.
We wanted to specifically flag two.
It might void Tesla warranty/warranties
It might limit TLC drivers ability to access the Tesla Supercharger network
If TLC, EV Warranty Void?
Firstly, don’t get us wrong, we are believers in an EV future and are encouraged to see EV adoption and investment rates increase, especially here in NYC. At the same time, there are a lot of questions TLC fleets and drivers, who want to adopt EVs, have.
In fact, we first spoke to Tesla in 2017 about adding a couple of pre-owned Model S’ to the luxury-focused TLC fleet we operate. We visited and met with the Tesla service advisors at their sole NYC-area service center in Brooklyn (Red Hook). We test drove the vehicles, which were great. The rates we could achieve by leasing a Tesla Model S would have been financially attractive.
So, why didn’t we buy those Teslas for our fleet? Short answer is when we asked Tesla if the battery warranty would be voided if the car was used for commercial purposes, such as rideshare, they would neither confirm or deny that the warranty would be voided. In short, they might have voided the warranty, or at least that was our assessment after trying to get a definitive answer from multiple Tesla representatives.
While operating an EV can be cheaper than a gas car (“ICE”) in many ways (i.e., no oil changes, very few moving parts), the battery, if not covered by warranty, can completely change fleet/vehicle math if it degrades (loses range) or needs replacement.
“….when we asked Tesla if the battery warranty would be voided if the car was used for commercial purposes, such as rideshare, they would neither confirm or deny that the warranty would be voided.”
- AutoMarketplace
For example, when we started our fleet in late 2016 we began with BMWs. However, we originally wanted to start with Mercedes-Benz. When we went to Mercedes-Benz dealers, they were actually very upfront about the fact that if we put TLC plates on their cars, the warranties would be voided (“commercial use” clause). So, when we saw a video of famous Tesla frenemy Rich Rebuilds, parting a salvaged Tesla after saying the owner junked it because Tesla voided the warranty after they found out it was being commercially used (ridesharing? 🤔), that pretty much scared us away from purchasing Teslas for TLC purposes.
If Uber is sharing NYC TLC driver data with Tesla, that is basically creating a list for Tesla where it can flag which of its vehicles are being commercially used. Following on from the points above, Tesla might then refuse to perform warranty work citing a “commercial use” clause.
If TLC, Supercharger Access Limited?
Given, Tesla Superchargers are meant for all Tesla/other partner OEM EV owners, a charging waiting line in NYC is NOT only going to be filled with TLC drivers. Therefore, it might annoy non-commercial customers, who likely charge their EVs much less frequently, to wait in lines made up of a lot of TLC-plated vehicles.
Tesla’s official Supercharger Fair Use Policy actually flags the use of its network by taxis or Uber/Lyft drivers. Although it clearly states TLC drivers can still use the Supercharger network, as long as it’s on a pay per use basis, Tesla might take action to limit commercial vehicles using its Supercharger network during certain hours. Alternatively, perhaps working with Uber’s data, they’ll actually create TLC-only Supercharging hubs!
It is definitely noteworthy that in 2017, Tesla actually did enact a policy that limited taxis and rideshare vehicles from using its Supercharger network. Now, to be fair, in 2017 Tesla had a much smaller charging network (but also a much smaller fleet of sold vehicles too). For example, if Tesla knew, due to its Uber data sharing arrangement, which vehicles are being used for NYC TLC work, they might start limiting them from charging when non-commercial customer usage is high and direct them to charge during less busy hours.
We’re just speculating, but we do think it’s something to track. Remember, once Tesla identifies where to build new chargers in NYC, that’s a significant investment given real estate costs and the turnaround time to add more Supercharger hubs might be slower vs. other regions.
Whether Tesla will invest so significantly in NYC charging infrastructure, is to be seen. However, in meantime, Revel, and others, appear set to build additional NYC area fast charging hubs, but the pace might not be able to keep up with TLC & City demands.
As always, let us know your thoughts in the comments section below or by emailing us at info@automarketplace.com.
AutoMarketplace NYC covers the for-hire transportation industry and automotive news. Check out AutoMarketplace on YouTube ▶️
It amazes me that the TLC didn’t realize (or did they) that drivers were desperate for their own plates and not really desperate to get an EV. Smh
This was a breathtakingly comprehensive article on EVs with regard to NYC TLC FHV use and the mention of the current frigid weather shenanigans happening in Chicago at the moment to EVs only compounds this issue. Every single NYC City Council member and leaders in the Mayor’s office (including Mayor Adams himself) should be reading this thoughtful analysis. NYC TLC is NOT READY for 100% EV fleet by 2030. Not by a long shot and this well written exposé proves that. Thank you. It is this type of intelligent, hard hitting breakdowns that are needed to overcome the politically expedient motivations that will have a devastating impact to the FHV industry. The TLC already almost destroyed the yellow taxi business. Let’s not have a grander scale repeat for the FHV industry, which truly does cover every nook and cranny of this City-not just the lower half of Manhattan. I really hope NYC will reconsider their EV mandate. Thanks, again. Great work!