INDUSTRY IN REVIEW

By Don McCurdy

That about sums it up.

Recent articles out of Ottawa recognize the battle between good and evil, or Uber and the taxicab industry in this case, with the teller of the tale deciding which is which. One of the articles quoted a “professor of strategic management” who indicated that wherever Uber had disrupted the industry “there’s something wrong with the current system.”

Reports out of the Taxicab, Limousine and Paratransit Association are that the main topic of discussion at their recent event in San Antonio was Uber. How do you deal with Uber entering your market? How do you defend your turf? Well, as the professor stated, there is something wrong with the current system.

Now, if you’re a company it’s pretty easy to wonder what they mean by that. I get that. Since you’ve had it your way for a few decades it seems like it should always be that way. Well the worm is turning and real competition is at the bulwarks.

This isn’t the driver co-op or the “professional driver’s association,” this is competition for the cream, not the crumbs. These boys got some cash, enough to buy some friends. Like you’ve been doing throughout your history, they want to alter the regulatory market to suit their needs. Therein lies the problem and, in my mind, the solution.

Uber can only win if the rules are changed to support their objectives. They’ve proven they have the financial resources to persuade regulators in numerous jurisdictions that the regulators don’t need the kind of regulations taxicabs need.

How did that happen? Well, you did it. You needed to create some separation between the “independent contractor” driver and the company to reduce the company’s tax burden and potential liability in traffic encounters. Separation was also created between the driver’s income and the company’s income. More cabs meant more income for the company, but not the driver.

The taxicab industry taught me a lot of wonderful lessons about life, business and service. Unfortunately, most of them were lessons learned while driving, not managing. How to treat people, how to satisfy a customer, how to deal with problems, how to prioritize. As near as I see it, if taxicab companies are to survive they will have to police their product, something many services have simply been unwilling to do.

The good old days of any warm body in the front seat paying any part of any lease is better than the cab sitting on the lot are coming to an end. All I can say to that is it’s about time.


Why would they need that?

D.C. Police Chief Cathy Lanier says drivers don’t need to carry concealed weapons. Really? How would you know, Cathy? You ever been alone in a high crime area carrying cash without a weapon? Of course not. That would be crazy. Yet that’s what happens with taxicab drivers every day and especially every night. They go where no DC police officer would go without backup.

Reports from every jurisdiction are that taxicab drivers are right up there with police officers and security guards as one the most dangerous occupations, and yet nobody is suggesting disarming the police.

Since there is absolutely no doubt that Cathy’s officers cannot protect DC taxicab drivers why wouldn’t drivers need to be able to protect themselves? The answer is obvious, they do need the ability to protect themselves. No, I’m not recommending that every driver be given a handgun when issued their license, but there is no reason an honest citizen should be denied the fundamental right of self defense.

So Cathy, before you judge whether taxicab drivers “need” to be able to carry concealed weapons to defend themselves, how about you drive a few night shifts at one of the local companies without your hardware? Perhaps it may give you a different perspective on what others “need.”

Across the country taxi drivers are killed and injured every day. Their numbers consistently rival police officers for the number killed and injured in the line of duty. They do all that and they aren’t looking for trouble. I know from personal experience that being the only one in the car without a weapon can be quite depressing.

Good luck with that Secret Service gig mentality. You certainly don’t need to be the one deciding who is allowed to protect him/herself. I find it quite hypocritical that someone, who would seek a job heading up a team armed with firearms assigned to protect someone, say that others don’t “need” the same protection.


Ya think?

The Philadelphia Parking Authority (PPA) is having a little trouble unloading the 46 new medallions they manufactured from thin air. While they’re debating on how to allow “ride sharing” services to service Pennsylvania in Harrisburg nobody seems to want to spend half a mil to buy a medallion that gives them the right to do grocery runs and ghetto calls and nothing more.

Meanwhile, Medallion Financial is taking a dive as investors realize that without protection from Uber et al the taxicab medallion market will make bogus mortgage investments look hot. While the TLPA may not have an effective strategy to deal with Uber the, IATR best start working on how they’re going to protect the integrity of their medallions or the city’s cash cow may start losing some weight.


Strike, strike, strike!

Already? Uber drivers are up in arms in San Francisco and New York. While Uber scrambles to placate regulators about “surge pricing” and other network charging schemes drivers are complaining they’re getting the short end of the stick. Oops, sounds a little like the taxicab industry.

If Uber can’t figure out the optimum number of vehicles to provide reasonable service and maintain driver income the taxicab industry may not have to worry about Uber. Considering their business model, Uber really has no reason to limit the number of vehicles available other than to maintain driver income.

Taxicab companies have been unconcerned about driver income for decades, and it cost them driver loyalty. Uber’s claim to fame is reliable service on the customer side and income on the driver side. Failing to maintain on one side will most certainly have a negative effect on the other side.


Homogenized cabs?

San Francisco, home of the upstart Uber, now has a new ap based dispatch company, Flywheel. Cute, except most cars don’t have flywheels anymore.

But I digress. The Flywheel ap is reported to dispatch trips for a mere 10% of the meter. That’s great. Pay the city for the medallion, pay the company for the mandated “radio” and now pay the ap company for the privilege of servicing their customers.

Ever notice how everybody wants to have his/her hand in the taxicab driver’s pocket? One company visionary is reported as saying Flywheel was the savior of the industry. Gee, who would of thought of a smart phone app as a savior. I missed that one.

The only holdout to the party is Yellow Cab. They have their own ap and a pretty expensive dispatch system. What’s in it for them? Why would the companies need to be on board with Flywheel anyway, the drivers are the ones picking up the fares. If somebody is taking a dime of every dollar I make I would hardly look on them as a savior. My thought would be more of a parasite.



If you have any comments regarding this or any of my articles please feel free to contact me at don@mcacres.com. —dmc

 



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