The Taxi service cemetery--Uber and Lyft Taking Their Toll on Taxi Drivers

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(Harry) #1

After the invasion of Uber and Lyft, taxi drivers all over the US face similar situations. Where many companies have just closed down, and others struggle to survive. A few have managed to squirrel in their app, but for the most, taxi services are like typewriters and film processing camera's, a thing of the past.

One such instance to show the Uber effect can be found in the Green Cab Taxi lot, where it was once a 19-taxi company, it is now down to six and still struggling. Carl Ditlefsen works out of a cluttered office with a lean too covered by a tarp. He works an 11-hour shift and hardly has much work, while he earns minimum wage, his Uber and Lyft counterparts take around $20 per hour gross, and usually find themselves working strong schedules.

Ditlefsen states that "I used to work four or five days a week, and you were able to survive. You weren't on easy street by any means, but you were able to survive. If you keep me busy, that's all I ask."

Another issue that Ditlefsen stated was the fact that they don't make enough for pension, so basically, he has no plans on retiring. He stated "Oh, I don't think there's retirement in sight. You drive until you die. Whether you like it or not, a lot of us don't have retirements to fall onto."

Many, thousands around the nation echoes Ditlefsen’s story. What is sad is that some of the drivers can be so stubborn, fighting in the face of the storm and expecting to survive the hit of lightning time after time. While the writing appeared on the wall way back in 2012, it was not felt until 2015. From 2016 taxi drivers should have realized that the gig economies were here to stay and to expand. When a corporate giant worth billions come to market, small entities that might be consolidated into a group have no real chance. The strength is in the electoral vote, and a large company employing a million voters will always have the power of a decentralized group. This unfortunate fact hit home quite strongly a while ago when one chauffeur driver Doug Schiffer committed suicide by shooting himself in front of NYC city hall.

Most of the taxi services are crashing, Yellow Cabs in San Francisco went bankrupt in 2016, this was due to the medallion value which was initially $250,000 each. Yellow Cab held 500 such medallions but ended up selling all of them for around $800,000.

Mark Gruberg, co-founder of Green Cabs said that Uber and Lyft own even the big paydays such as Halloween, Valentine’s day, and New Year’s Eve. He is also a cab driver, and like many others, they own a medallion that has no value. This devaluation of their main asset, their medallion, has made many drivers financially insolvent. Most drivers have taken out loans and mortgages using their medallion value as part of, or all of the collateral, and now their face value is so low, and their incomes hit so hard that they face personal bankruptcy.

A recent stud performed by Hastings Law Professor, Veena Dubal shows that the effect of Uber and Lyft is more than just financial. Taxi driving was a profession and a community. Now, driving for Uber and Lyft is a personalized, individual affair. There is no meeting point, no taxi rank. Customers seek a comfortable ride for less cost and are feeding the gig rideshare giant. The customers have caused the shift and are the real blame for the demise of taxis.

Based on this finding it is obvious that the days of taxi's in the US is limited. There is no future for the industry, and they will be replaced by both individual drivers as well as fleet owners.

To sum up a once vibrant livelihood, cab driver Joe Desalvo, 74 years old, driving cabs since 1984 said that he took a loan to buy his medallion. He said "I'm 74, and if I was younger I'd just leave. I'd get a second job or do something else, but my time has passed for that. I have to do what I am doing for as long as I can and make it work somehow." Desalvo went on to say, "There are drivers who are applying for food stamps and welfare. I haven't done it, I haven't had to, but this is the first year I've been underwater."

To conclude this article, there is one solution for drivers like Desalvo, if you can't beat them, join them. He should apply to work for Lyft or Uber, as a professional driver he will fit in easily and quickly.


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(Andrew Martin) #2

The writing was on the wall, and yes drivers like myself do take from taxi drivers since we offer an alternative that is both cheaper and friendlier (most of the time). When we factor in the 700,000 rideshare drivers working the US versus the probable 300 incidents a year involving drivers (reported ones), they average out to exactly the number of incidents reported with taxi drivers and much less than workplace incidents (sexual harassment, violence, etc.) I do sympathize with the taxi drivers, and have personally been involved in downsizing as well as being laid-off work due to corporate reasons that left many employees unemployed. Its a very bad feeling, and I also understand why a person can reach a low that makes them think of suicide. I have personally been there myself and managed to pull myself up from the depth of despair by changing my life around 180 degrees. Literally making a new life, a new start, from zero, just building up again. I have to add, that even than I had issues with employment and in one case was in a job for only a week. What did I learn from all of this? I learned that being self employed sucks because you have to constantly fight for a daily income, but it is better than relying on the falsehood of “job security”. There is no such thing, unless you are a government employee, forget about the security BS.
Bottom line: I feel sorry for all the people that cannot adapt to change, for some it is hard, for others easier. In the end, the strong survive and the weak don’t. So my message is “Be strong, wake up every day prepared for a battle, work hard, and enjoy the small moments of happiness you have with your loved ones. If you have a dream, follow it, but have more than one dream, have a dream to follow a dream, because hope is the only true reason we shine.”


(Steve Mann) #3

I read about that poor guy, ad Andrew, you are one strong brave dude opening up like that. I also think that rideshare is not the culprit. I think people need to be prepared to change with the times. Also, if I work part time with Uber and part time with contractual work, then so should taxi drivers. The market is open and free. If their life is so hard, than change it, make it better. Sitting and moaning won’t help.