The discussion on the value of New York City medallions continues. A recent article claims that a medallion recently sold for $241,000, down 77% from the $1,050,000 medallions sold for in 2014. Matthew Daus is reported to have stated that a recent bankruptcy case valued an independent medallion at $575,000. Not catastrophic Daus claims, but it was a bankruptcy, right?
Let’s see, at Daus’ estimate a decrease of 45% of the value of an asset isn’t catastrophic? I wonder what would be catastrophic? The article further claims that the industry shared revenue of $1.8 billion between “nearly 13,600 medallions.” Rounding up that would be around $133,000 per vehicle, per year.
I don’t know what it costs to operate a taxicab in New York City these days, but at that amount of revenue being split between the driver, the bank, the vehicle owner and the medallion holder doesn’t seem like a pie big enough to share. Near half would go to the bank if you borrowed the money.
So, the question remains for New York City’s chief medallion price apologist, if your broker had you invest in an asset that lost 45% of its value in two years would you fire him, or shoot him?
Reports are a lawsuit filed on behalf of about 2,000 Miami-Dade taxi license holders has been tossed out because “taxicabs have not, for now, become obsolete,” according to U.S. District Judge Darrin Gayles. Uh, for now? While the judge seems to recognize that the industry is in a serious, or should we call it catastrophic, situation he doesn’t agree that the industry can’t adapt.
I can’t disagree with the judge. While the taxicab industry has been protected by the very government they’re suing everything was fine. Now that they have to compete everything is not so fine. Well, obsolescence or competition, what’s it going to be?
Well, innovation in the taxi industry, what a concept? It’s reported that a Japanese taxicab company has introduced a “Silence Taxis” in one of Japan’s major cities. The concept is that the driver will greet the passenger, find out where he/she is going and then will only speak if spoken to.
The service is reported to be in a trial stage with only a few taxicabs having a sticker on the back of the front sea identifying the vehicle as a Silence Taxi. The company initiated the service after hearing of complaints from passengers about having to chit chat with their drivers. I wonder how they feel about the driver talking on their cell phone the entire trip?
It has been reported that San Francisco taxicab medallion holders will no longer have to pay a renewal fee starting July 1st. According to the report, the SFMTA, San Francisco Municipal Transportation Agency, has been trying to “help” the taxicab drivers during the “tough economic times over the last four years.” But I thought the economy was doing fine. What tough economic times?
One of Luxor’s drivers who purchased one of the now near worthless medallions, David Smith, is reported to have said “this is a bandage over a bullet wound.” The city should be embarrassed that they conned as many people as they did into buying the right to work in a profession going straight down the tubes, but they’re not.
Perhaps, the city might consider returning the money they charged for the medallion that other modes of on demand transportation didn’t require and let everyone operate Uber style with little or no supervision. Of course, with the price of housing in San Francisco being as high as it is, at least the medallion owners will have some place to live, in their overpriced medallion transport vehicle.
While we wouldn’t want to deem the price “catastrophic”, Yellow Cab Co-op in San Francisco is reported to have been sold for “chump change.” San Francisco, birthplace of the dreaded Uber, seems to be suffering poor driving habits though not from competition from Uber.
The industry as a whole has been on a downward spiral for decades, with less “professional drivers” and more warm bodies. Couple that with increasing employer and municipal regulations like in San Francisco and New York City, and you end up with an entire industry headed for ice deliveryman status.
Companies used to be able to absorb big insurance payouts because of their cash flow, but now not so much. Cities across the land are looking for ways to “level the playing field” that they helped to create by protecting and regulating the taxicab industry.
Innovation has given way to public utility status in most major cities. Want to “level the playing field?” Set the insurance mandate, drop the rest of the regulations and let the companies establish their own niche in the market. Do cities engage in price fixing of Uber or Lyft? Get out of the way and let them sink or swim in a free market. Nobody can swim with a 350 pound gorilla on his/her back.
Reports are the New York Taxi Workers Alliance is bashing New York governor Andrew Cuomo for an Uber bill that Bhairavi Desai, executive director for the group, deemed “a move straight from the Trump playbook,” which I suppose is meant to be the ultimate insult for a democrat. The part that gave me a chuckle was the “this bill is bad for workers, and it’s bad for democracy.”
Bad for democracy? I would have to point out to the esteemed director that democracy affords the supreme power to the people, not the government. The government suppressing a class of workers to the benefit of another class of workers is not democracy. Pseudo labor unions dictating demands to the duly elected officials of a representative republic, sometimes mistakenly reported as a democracy, is not exactly a democratic principal.
Also, where would one get a copy of this “Trump playbook?” It would seem to me that hockey, football and baseball teams would be clamoring for a copy of that play book since Trump’s historical, electoral stomping of Bill’s old lady. But I digress.
I would suggest to the esteemed director that encouraging the good governor to include taxicabs in the bill to help get the gorilla off the taxicab industry’s back would be somewhat more fruitful than calling out to the wolf to protect the flock. Perhaps, the director is seeking to achieve the level of power the Italian taxi drivers union demonstrated when they got Uber banned from the country?
This month’s Taxi King update finds our hero in another minor misunderstanding. Reports from NYC are that Mean Gene has not become the “court jester” of the taxicab industry. Oops. It seems the king’s license hasn’t been renewed by the NYC Taxi and Limousine Commission so he won’t be allowed to manage the 800 odd medallions he is reported to have been controlling. No big deal, get somebody with a clean record to get the license and bill yourself as the “Marketing Manager.” It worked for the mob in Vegas, why not New York?
The taxicab industry trade organization, Taxicab, Limousine and Paratransit Association, has been operating a website, whosdrivingyou.org, that extols the virtues of riding in licensed taxicabs over those dangerous Uber and Lyft drivers. It does so by “exposing” all of the nefarious deeds of those nasty boys and girls driving Uber and Lyft.
Now, having been in the taxicab industry for a number of years, I had to laugh hysterically at the idea that a group representing the taxicab industry would be pointing fingers at another group for its behavior.
A case in point is a Salisbury Massachusetts taxi driver appearing in court for his forth driving under the influence complaint. Huh? What company in their right mind would put a driver on the street with three such convictions? After my own experiences with Uber I certainly feel they can be beaten in the marketplace, but I wouldn’t recommend throwing rocks at them from my glass house.
Uber has only exposed a flaw in the industry, a flaw that the TLPA not only recognized but actively supported, protection by regulation. Now they are calling out to the 350 pound gorilla to save them from drowning.
Laredo Texas was on the verge of eliminating taxicab regulations entirely in an effort to “create a fair playing field” in the city for taxicabs and Lyft drivers. After comments from attorney Zone Nguyen on the long standing regulations being a matter of public safety the council voted to keep the regulations.
Nguyen wanted the city to apply the regulations to everyone in the industry, not just taxicabs, but the council decided that the rules would not affect rideshare companies. Oops. The mystifying part of the entire story is that Nguyen was representing the taxicab drivers. “No, please, don’t get off our backs, protect us.” That would be my quote.
The council also stated that over the next six months the staff would work on a “more fair” ordinance. Be careful what you wish for, this could be bad. But not catastrophic.
There is a report circulating that Uber has engaged in some Russia like hacking of Lyft drivers in an effort to get drivers who drove for Lyft and Uber to only drive for Uber. The operation, called Hell, is reported to have occurred between 2014 and 2016. No word from Uber about any of this, but I’d be hiring extra cats to be covering up this litter box if it’s true.
What is up with the New York/Washington DC media cartel? Their “Russia did it” narrative has more holes than the taxi king’s empire but they keep beating the drum like people think it’s real. They sound like a group of busybodies chanting out whatever unsubstantiated rumor their “unnamed sources” can come up with.
If you ever want to get and stay relevant just tell us the truth. Making up stories to support your political agendas may please your corporate masters but it really bores the rest of us.
If you have any comments regarding this or any of my articles please feel free to contact me at: don@mcacres.com. - dmc
