The priceonomics blog has a great post on traditional taxis (medallion-based systems) vs new ridesharing startups (technology-based systems like Sidecar, Lyft, Uber and Instantcab). Its a great read about the current state of ridesharing in cities and the history and economics of the taxi medallion system.
The article talks about why medallions are outdated:
When this medallion system was introduced in New York City in 1937, there were 11,787 issued. That number remained constant unti 2004. Today there are 13,150.
The economics of being a taxi driver:
UCLA professors Gary Blasi and Jacqueline Leavitt found that taxi drivers work on average 72 hours a week for a median take home wage of $8.39 per hour.
The transformation from medallions to free market:
According to publicly available statements from ride-sharing companies, there is strong evidence that there are already more community drivers on the road than regular taxis in San Francisco. In San Francisco, the transformation from a medallion constrained taxi system to a free market is nearly complete. These ride-sharing companies are all rapidly expanding across the country.
The government’s reaction:
“These medallions are public assets. The value belongs to the people of San Francisco for the benefit of the transportation system.”
– Ed Reiskin, San Francisco Municipal Transportation Agency Director
“I really hope we keep the medallion system and get rid of ride-sharing apps.”
– No one who uses San Francisco Municipal Transportation, ever
Read more on priceonomics »
San Francisco taxi origins and destinations, with magnitude blobs by Eric Fischer
The San Francisco board of supervisors will vote on a law that will require all taxis to transmit their locations to a central system. Additionally, all apps based on hailing cabs (UberTaxi, Taxi Magic, Flywheel) would be required to use the network.
This will have a few effects:
- Create a great new source of data about cab demand and supply for SFMTA to use when deciding how to regulate cabs and potentially allow additional cabs.
- Enlarge the pool of cabs hailable via apps
- Remove app companies ability to regulate which drivers are allowed into their systems, potentially decreasing driver quality and passenger experience
SFist puts it best:
A good number of our cab drivers are unprofessional bigots and goons who don’t represent well for their ilk, smoking in their own cabs, refusing to take credit cards, being homophobic, and refusing to drive to the Sunset and elsewhere.
Uber Taxi charges an additional $1 on top of the cab cost and tip to use its service for hailing a cab. One benefit to using Uber Taxi is that it has vetted drivers and will remove drivers with low ratings from its service. If uber was required to use all San Francisco taxi drivers, no matter how bad thier rating was, there would be less incentive to use uber over other taxi hailing apps.
Uber gets to navigate arcane local, county and state laws and corrupt taxi monopolies in every city where it launches. Denver is no exception.
The Colorado Public Utilities Commission has proposed regulations that will make transportaion services like Uber effectively illegal (or too costly to be viable).
- Non-taxis can only be chartered by time, not distance (section 6301)
- Non-taxis can not be located with 200 feet of a hotel, motel, restaurant airport, or bar, effectively excluding non-taxis from dense areas of cities (section 6309)
- “partnering with local sedan companies will be prohibited” – not exactly sure how this is interpreted, but it sounds bad (section 6001 ff)
It will be interesting to see how this proceed. At this point, Uber has become fairly accepted in most other major US cities, after several other legal battles.
Today Uber announced that it was lowering its rates in San Francisco by about 10%, effective Jan 21, 2013. This brings the cost of using Uber in SF closer to the cost of a Taxi.
The minimum fare of $15 did not change, so very short trips will cost the same. However, most trips will have a reduced price. The old and new prices for regular Uber (black car) trips in SF:
Uber also launched UBERx for everyone today (it was in private beta). UBERx is a lower priced version of Uber that uses hybrid and mid-range cars, not necessarily black. UberX rates:
For reference, San Francisco taxi rates:
||SF Taxi Rates
(includes first 1/5 mile)
|Per Minute of waiting or traffic delay
I crunched some numbers for a few theoretical trips:
||New Regular Uber rates
|Mission to SOMA
(2 miles, 3 mins of waiting)
|Inner Sunset to Marina
(4 miles, 7 mins of waiting)
|Golden Gate Bridge to Caltrain
(7 miles, 15 mins of waiting)
UBERx costs 25-30% more than at taxi (including gratuity) while the new regular Uber rates are about 40-45% more than a taxi. The main benefit of Uber over a taxi is reduced travel time and reduced variability in trip time. By booking a ride through the app, users know exactly how long until their driver arrives to pick them up and can monitor progress in the app. Unlike with taxis, there is no chance they will abandon you and pick up someone else en route, so you can be certain about when they will arrive. For many high value trips, the additional 25-45% cost over a taxi may be worthwhile.
There are other benefits of Uber over a taxi:
- Nicer vehicles
- Consistently friendly and knowledgeable drivers
- No cash or payment needed at end of trip (payment is via app and happens automatically) This speeds up travel time slightly as well.
It should be also noted that Uber launched a new option to request a standard SF taxi through their app. The trip cost is standard taxi rates plus $1 and 20% gratuity.
Uber is worth trying out for your next high-value trip. They currently have options in 26 cities and 7 countries, although not all vehicle options are available in all cities (San Francisco tends to get most of them earliest).
The Bay Citizen did an analysis of all 1700 of the recorded complaints about taxis in San Francisco. Complaints were sent to the city’s 311 compliant line. The 1700 complaints span from July 1, 2011 to June 30, 2012 and represent a 13% increase over the previous time period.
The complaint list is an interesting read.
- 361 complaints about drivers not picking them up because of their appearance
- 206 complaints about being overcharged
- 200 complaints about drivers not taking credit cards
- 130 complaints about drivers not picking them up because of their destination (usually the Sunset or Richmond)
- 40 complaints about drivers charging illegal fees
- 35 complaints about drivers using cell phones
- 25 complaints about drivers smoking
- 15 complaints about drivers not picking them up because they were African American.
SFMTA has one person in charge of investigating complaints.
Poor quality taxi service is one of the reasons why users seem to be so enthusiastic about new ride-sharing services Sidecar and Lyft as well as taxi-replacement service Uber. Payment and overcharging are not a problem as all of these services handle it directly via a smartphone app. Users can complain directly to the company if they have any issues. Lyft, Sidecar and Uber have a lot of incentive to take complaints seriously as users won’t continue to patronize them if drivers are rude, refuse to take them places or drive in an unsafe way. Because trips on these services are booked via smartphone, every trip is tracked so a user has a record of who the driver was, whereas with a taxi and a cash payment unless you remember the can drivers ID you may not know who to complain about.
On Dec 13, 2012 the City of New York’s Taxi commission voted to allow electronic hailing of taxis.
UberTAXI launched in September 2012 but was shut down a few weeks later by taxi officials due to a rule that forbids prearranged rides in taxis in New York. That rule is somewhat unique to New York, in other cities where cabs are rare most rides are prearranged (by calling a cab). In New York, calling a cab to pick you up is illegal. This makes it difficult to get cabs in less busy parts of new york.
The recent approval will allow a one-year pilot program to allow companies to prearrange cab rides. This means that uberTAXI (already live in New York) and other companies like Flywheel can now operate in the largest taxi market in the US.
Uber operates in over 20 cities and 3 continents and uberTAXI is live in San Francisco.
Uber provides a great service, and adding taxis to their array of transportation options (black car, hybrid, SUV) is a great additional transportation choice.