Is that an opportunity?

By Don McCurdy


A recent report says that Uber has dissolved its relationship with Walmart. Apparently, the delivery of groceries did not merge well with the transportation of passengers.

If you consider the idea that a package cannot get out of the car and walk to the door, it would be hard to deliver packages in a driverless vehicle.

Since driverless vehicles appear to be the wave of the future, it doesn’t fit Uber’s desired business model. The report goes on to state that Uber will cancel their “Rush” program entirely.

The less than two year old agreement to deliver Walmart’s groceries had Walmart as Uber’s biggest “Rush” program. Lyft is also reported to be delivering for Walmart, but only in one city. Perhaps, they may add a few more cities as Walmart attempts to keep pace with Amazon who seems to be able to deliver anything, anywhere overnight.

Walmart is reported to be working with some startups to get their groceries delivered while Uber is focusing on Uber Eats which is reported to be generating 10% of Uber’s revenue. I would be interested to see how these new delivery startups work out since drivers will soon be in abundance.

Who’s the new guy?

Reports are that Uber’s self driving car accident that killed a pedestrian was a software problem that did not deal with the potential problem until it was too late. While the situation is still being reviewed, Uber has taken the proactive step of hiring a former head of the National Transportation Safety Board (NTSB) to help “advise” them on safety matters.

In what could only be called a wild coincidence the NTSB is investigating the accident and is expected to issue a report in a few weeks. Do you suppose the new guy has any former coworkers at the NTSB that might also help him advise Uber on safety?

The good news is that the new guy is reported to have said that the crash wouldn’t derail the move toward driverless cars. The current Uber CEO is reported to have said that “autonomous vehicles will be safer at maturity.” Yeah, so will teenage boys.

“Bang, bang, you shot me down.”

Reports are that three judges of the 3rd Court of Appeals did not overturn a lower court decision to throw out the case brought by the Philadelphia Taxi Association and 80 taxicab companies.

The complaint was of medallion devaluation, loss of profit and undesired competition.Undesired competition? I wonder what that means? Competition that kicked your butt, or competition that failed to voluntarily comply with local taxicab regulations?

The taxicab industry has been protected by “regulations” for decades, with reliability, service and prices not facing serious competition. The vast majority of cities price fixed the product and had other regulations to keep out real competition.

Taxicab companies have not had to labor under the difficult yoke of “free markets,” with the regulators protecting and controlling them. The article further reports that there was no incentive to innovate or improve service. Wow, where have I heard that before? It’s like Déjà vu all over again.

The new kid in town has the same issues as the old kid in town, except they don’t have to have a medallion. There are other advantages also, like not having a call center. However, the biggest is not complying with all of the taxicab regulations.

Some regulations are absolutely important. Others are simply the regulatory body protecting the independent contractor status of the drivers so the company can stay out of court defending those suits. Either way, it appears Johnny Cab is on the way to save us.

“It’s alive!”

Meanwhile, in Seattle, the federal court ruling allowing the unionization of Seattle Uber and Lyft drivers was overturned by the 9th Circuit Court of Appeals. The suit was brought by the U.S. Chamber of Commerce as part of the eternal debate as to whether ground transportation drivers are independent contractors or employees.

While the line is vague for some ground transportation companies it seems to me that it would be harder to prove the case with Uber and Lyft since the companies exhibit very little control over their drivers. The previous judge, who now has the case back, is reported to have ruled that the state of Washington authorized cities to regulate the ground transportation industry.

The 9th circuit ruled that, while the state law allows cities to regulate what companies charge riders, it does not allow cities to regulate “fees drivers pay companies like Uber and Lyft in exchange for ride referrals.”

I have never heard the ground transportation fees drivers pay as “ride referrals.” While you would have to stretch it a bit to say the same about a day lease or weekly lease a taxicab driver might pay, it most certainly seems plausible to say that drivers are giving a percentage for the referral.

In a previous article I stated this case could have huge ramifications, and that still appears to be the case.

Uh, is that safe?

Okay, so I’m ever so slightly paranoid. My wife bought an Alexa and a Google home device that listens for you to call their name. Who could possibly be paranoid about a listening device connected to the internet in their bedroom? With that in mind it’s no great leap to wonder how long it will take for me to be comfortable in a driverless vehicle.

I am getting old and frankly that isn’t on my bucket list. Now, let’s couple that with the new player in the driverless car market, Didi Chugging. It is reported that Didi Chugging, bought Uber’s Chinese business last year. It is now owner of Uber’s permits to test autonomous vehicles in California.

Now, I know nothing of the company or its driverless cars, and frankly I can see a need for driverless cars as Americans seem to drive more poorly every year, but the idea of riding around in a software controlled car with Chinese software?

I can’t hardly wait for the Jeep Jihadi self driving car to hit the roads. So why is it that the gun laws preclude us from owning our own LAWS rockets?

Hey that’s a smart looking jacket.

Reports are that a new Levi’s jacket will “ping” when your Uber or Lyft ride shows up. Reportedly, the “Snap Tag” on the cuff lights up and vibrates when the vehicle arrives or you can hear its progress on headphones connected to the jacket. Hah, you call that progress, it can’t even summon the car service for you. What’s up with that?

What’s the rest of the story?

A recent “monthly average amount spent per user for Uber versus Lyft” was published recently by CNBC. The survey was of 50,000 of money app Empower users looking at Empower user’s Uber and Lyft data.

One of the interesting things that was missing from the article was the actual number of Uber and Lyft users there are since only Empower’s users were surveyed. The article, while interesting in a lot of ways, did point up the difference between Uber, Lyft and the traditional taxicab industry in their ability to analyze data.

While traditional taxicab companies I’m familiar with shied away from collecting driver income data, Uber and Lyft collect it as a necessary component of their payout system. The virtues of accepting credit cards was preached to taxicab drivers unsuccessfully. It would have been helpful to tell them how much drivers take in every month in credit cards. This may have encouraged them to participate more enthusiastically.

Separating tips from fares would also be an important bit of information since the claim is that credit card users tip better. The protection of regulation stifles innovation, and not only in the taxicab industry.

It’s a crisis!

A recent article stated that a New York City council member, the article used the chauvinist term “councilman,” urged the Taxi and Limousine Commission (TLC) to drop fines against drivers that don’t involve pedestrian safety.

Ydanis Rodriguez, the council member in question, is a former driver and laments that “we are in the middle of a crisis in the taxi industry that is hurting hard working New Yorkers, many of whom are immigrants that came to this country in search of a better future for their families.”

He further is reported to have commented, via email, It is incumbent upon us as policymakers to employ any tools at our disposal to make sure we’re not abandoning these families to their fate.”

Several ideas just jump off the page at me. The first is “as policymakers” the city council is permitted to change the rules for taxicabs to allow them to compete. Are Yellow cabs still chained to the solution of the past and not allowed to accept radio dispatch requests for service?

What if a taxicab company wanted to get payment in advance on dispatched via credit card to protect their drivers. Would that be absolutely unconscionable?

What does elimination of fines do, besides assist drivers who have not followed the rules? What does it do for the drivers who have followed the rules?

Second, are we to be more concerned about the immigrant driver than the industry lifers who have invested a small fortune in a now near valueless piece of tin? The industry is rife with stories about medallion holders on the verge of bankruptcy because of plummeting medallion prices. How does dropping the fines help them?

Regulations cost money, the more you reduce regulations the more you help them. Next time, Mister Ex Taxicab Driver, look hard at the regulations. Are they there for a solid reason or are they fixing a problem that didn’t and doesn’t exist? Are they absolutely necessary for the safety of the public?

You’ve got your heart in the right place, now get your head straight and look at real problems, not feel good solutions that only help a portion of the industry prone to problems.

“His troubled taxi business?”

We’ve all followed the “daring do” of the president’s former lawyer Michael Cohen, yawn, and recent articles about him, both real and imagined. Without boring you with the latest version of “who paid who to shut up about what,” I’d like to address just the headline, “Michael Cohen’s Troubled Taxi Business.”

Has anyone noticed that there seems to be a bit of a problem in the taxi business worldwide? I know, I know, it creates an opportunity to drag Cohen in the mud with CNN even doing his taxes, I’m certain, with their very questionable “standard journalistic ethics.”

While we certainly don’t know the financial situation of Mister Cohen and his family, what his family has, and while he has not been charged with any crime by any prosecutor, that doesn’t mean it’s not okay to drag him through the mud, does it? I mean, hey, he used to work for Trump.

The article is a transcript from NPR, which just warms my heart to know that my tax dollars help pay for the report. “All things considered” I’d just as soon have invested in the 7th at Belmont.

If you have any comments regarding this or any of my articles please feel free to contact me at: - dmc

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