By Shandra Martinez
New York has become the first major U.S. city to temporarily cap the number of new licenses to for-hire vehicles such as Uber and Lyft.
Part of a one-year study, the ban aims to curtail the city’s growing congestion and raise low driver wages. The move also could provide a model for other communities that want to rein in an industry that is mostly unregulated.
“There are public safety concerns because Uber drivers don’t have to have a background check that limo companies have to go through,” said Scott Margolin, owner of Coachman Luxury Transportation on Long Island.
His firm owns a fleet of about a dozen motorcoaches, including an Escalade stretch limousine. He worries the ban will lead to a surge of ride-hailing vehicles on Long Island because they aren’t regulated there.
Trips into the city and to nearby airports take longer because roads are clogged with ride-sharing vehicles, he says.
“As a motorcoach is trying to do a pickup, Uber drivers are surrounding the airport,” Margolin said. “A lot of these drivers are sitting in their cars waiting for apps to go off.”
Scott Solombrino, CEO of the Boston and New York-based Dav El BostonCoach Chauffeured Transportation Network, contends the luxury ground transportation industry is being unfairly penalized with the ban.
“We shouldn’t be capped, because we’re not a part of the problem,” Solombrino, a board director of the National Limousine Association, told the publication Luxury Coach & Transportation.
Unlike ride-sharing services, chauffeured transportation services are licensed and follow all labor laws, he said.
Uber, Lyft and black car services now have about 118,000 vehicles in the city, which regulates and licenses them through the New York Taxi & Limousine Commission. Luxury-level chauffeured vehicles account for less than four percent of ride-hailing vehicles, totaling just 4,000 vehicles, according to LC&T.
Uber argues the cap will lead to higher prices and longer wait times when demand is high.
“The city’s twelve-month pause on new vehicle licenses will threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion,” an Uber spokesman said in a statement.
The city will grant new licenses during the year-long moratorium only to vehicles-for-hire that are wheelchair accessible.
The ban tackles two big issues hitting the city, New York City Mayor Bill de Blasio said in a tweet: “Our city is directly confronting a crisis that is driving working New Yorkers into poverty and our streets into gridlock. The unchecked growth of app-based for-hire vehicle companies has demanded action — and now we have it.”
