Uber Strikes A Deal With New York Taxis
Taxi companies and Uber have been bitter rivals for years now. However, Uber and New York City Taxis recently came to a deal.
Written by Aleena Juarez
Reviewed by Kathleen Flear
Uber
is a rideshare on-demand service that has gained a lot of popularity in recent years. Typically, people sign up to become Uber drivers and use their own personal vehicles to complete trips. However, Car and Driver
recently reported that the app will soon include all of NYC's standard yellow taxi cabs. This move is incredibly surprising for some, considering the rivalry between Uber and cab drivers. Will this new partnership heal the troubled relationship between the two?The fight between taxi unions and ride-hailing apps like Uber
For nearly a decade, taxi drivers have been blaming Uber and other rideshare apps for plummeting sales. Most people would agree that booking a ride from your phone is less stressful than hailing a cab. Cab companies also have their own special apps, but these are far less popular compared to Uber or Lyft.
However, according to
Wired
, Uber is also at least partially responsible for the downfall of the taxi medallion system. Back in the 1930s, the medallions were created to curb taxi cab congestion on NYC streets. Only drivers who own (or partially own the medallion through leasing) are allowed to operate taxi cabs.The medallions are also very limited in quantity, with only 13,587 examples made. Before Uber happened, you could potentially sell one for over $1 million dollars. Retired drivers that leased the medallion out to new drivers could have a guaranteed steady income for years.
With the advent of rideshare companies, anyone could use their own vehicle as a shuttle with no such medallion. Demand for the medallions has since drastically plummeted, cutting off revenue and retirement funds for thousands of taxi drivers.
Taxi drivers urged the Mayor of NYC to regulate rideshare drivers in some way, citing safety concerns. Uber responded by making derogatory comments against the Mayor, which inspired a series of lawsuits from both sides.
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Why is Uber going forward with this plan?
Despite their differences, both rideshare services and taxi companies have struggled with profits in the past few years. As of 2022, Uber has lost 22% of its drivers compared to last year. This is largely due to pandemic-related concerns, which have also resulted in fewer drivers for taxi cab companies.
However, Uber is especially struggling in NYC due to some special ridesharing regulations. Only 96,000 vehicles are allowed to have active ridesharing licenses, and many of those vehicles don't get used each day.
According to Uber, both of the former rivals can expect to benefit from the partnership. Uber will have more drivers on NYC roads without having to fight regulations. Taxicab companies will also get more business because customers can select taxi cabs from the widely-recognized Uber app.
MORE: A Ride in One of These Taxi Cabs Should Be on Your Bucket List
When will Uber make the update?
Certain customers will be able to test the update this spring before it opens up to all users in the summer. By 2025, Uber wants to have every taxi cab in the world listed on its app. Car and Driver also speculate that Uber will lower its prices, which had to be raised due to driver shortages, during the summer rollout.
Do Uber drivers need special auto insurance?
Uber won't even allow potential drivers to sign up unless their insurance policies meet their state's minimum requirements. If you live in California, Uber also purchases Injury Protection for each driver. This insurance is always active while you're on the job, covering disability and any medical expenses.
You can also purchase an auto insurance plan through Uber. However, if you shop for plans without Uber's help, the insurance company might offer you special ridesharing benefits and discounts. To find out if you're eligible for these and any other kind of auto insurance savings, download the
Jerry
app.
4.7
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