MIT Study Says Uber Drivers Earn a Median Profit of $3.37 per hour & 74% of drivers Make Less than Minimum Wage

by Sean Riley


TechCrunch

Ride-hailing giants Uber and Lyft are delivering pitiful levels of take-home pay to the hundreds of thousands of US independent contractors providing their own vehicles and driving skills to deliver the core service, according to an MIT CEEPR study examining the economics of the two app platforms.

The report catalyses the debate about conditions for workers on gig economy platforms, and raises serious questions about the wider societal impacts of tax avoiding, VC-funded tech giants.

The study, entitled The Economics of Ride-Hailing: Driver Revenue, Expenses and Taxes, and which was carried out by the MIT Center for Energy and Environmental Policy Research, surveyed more than 1,100 Uber and Lyft ride-hailing drivers combined with detailed vehicle cost information — factoring in costs such as fuel, insurance, maintenance and repairs — to come up with a median profit per hour worked.

The upshot? The researchers found profit from ride-hail driving to be “very low”. On an hourly basis, the median profit was $3.37 per hour, with 74% of drivers earning less than the minimum wage in the state where they operate.

They also found a median driver generates $0.59 per mile of driving but incurs costs of $0.30 per mile; and almost a third (30 per cent) of drivers were found to incur expenses exceeding their revenue or to be losing money for every mile they drive.

The research also looked at how ride-hailing profits are taxed, and suggests that in the US a majority of driver profits are going untaxed owing to how mileage deduction is handled for tax purposes — suggesting Uber and Lyft’s business are denuding the public purse too.

From the study:

On a monthly basis, mean profit is $661/month (median $310). Drivers are eligible to use a Standard Mileage Deduction for tax purposes ($0.54/mile in 2016) which far exceeds median costs per mile of $0.30/mile. Because of this deduction, most ridehailing drivers are able to declare profits that are substantially lower. Mean drivers who use a Standard Mileage Deduction would declare taxable profit of $175 rather than the $661 earned. These numbers suggest that approximately 74% of driver profit is untaxed.

The authors add that if their $661/month mean profit is representative then the US’ Standard Mileage Deduction facilitates “several billion in untaxed income for hundreds of thousands of ride-hailing drivers nationwide”.

So what does the study tell us about the ride-hailing business model? “It tells us that it’s a shitty place to work,” says Mark Tluszcz, co-founder and CEO of Mangrove Capital Partners who has described the gig economy model as the modern day sweatshop, and says his VC firm made a conscious decision not to invest in gig economy companies because the model is exploitative.

“It tells you that it’s a great place if you’re a company. It’s really a poor place to be an employee or be a worker.”

The exploitative asymmetry of ride-hailing platforms comes because workers have a certain amount of fixed costs but the platform intermediary can just hike its commission at will and lower the service cost to the end user whenever it wants to increase competitiveness vs a rival business.

“At the end of the day there are a certain amount of fixed costs [for drivers],” says Tluszcz. “You have to buy a car, you have to get insurance, you have to pay for gas… And if you as an intermediary, which those platforms are, are taking an increasing amount of commission — 10%, 15%, now 20 in most of their markets — and then you’re using the price of the trip as a way of beating your competitor… then you as a driver are sitting there with basically all of your fixed costs and your income is going down and frankly the only way to cover your costs is to spend more hours in the car.

“Which is frankly what’s clearly illustrated by this study. These people have to spend so much time to cover their costs when you break it down to an hourly revenue, it’s a pitiful amount. And by the way you have no social coverage because you’ve got to take care of that yourself.”

At the time of writing neither Uber not Lyft had responded to a request for comment on the MIT study. But an Uber spokesperson told The Guardian the company believes the research methodology and findings are “deeply flawed”, adding: “We’ve reached out to the paper’s authors to share our concerns and suggest ways we might work together to refine their approach.”

Tluszcz was quick to dispatch that critique. “MIT is not some second tier organization that did this study,” he points out. “For me that’s a reference moment when MIT says look, there’s an issue here… There’s something wrong in the model and we can tolerate it for a period of time but ultimately we’re creating this lost generation of people.”

“These business are built on situations in the market that are not realistic,” he tells TechCrunch. “They took advantage of a hole in legislation… Governments let that happen. And it made all of sudden services cheaper. But people have to eat. People have to live. And ultimately there’s only 100% of a cake.

“Cabbies in the UK are not millionaires; they make a decent living. But they make a decent living because there’s a certain price-point to offer the service. And in every industry you have that. There is a certain fair price point to be able to live in that industry… And clearly right now, in the ride-sharing businesses, you don’t have it.”

In Europe, where Uber’s business has faced a series of legal challenges, the company has begun offering some subsidized insurance products for platform workers — including one for Uber Eats couriers across Europe and a personal injury and insurance product for drivers in the UK.

 

In January in the UK it also announced a safety cap on the number of consecutive hours drivers on its platform can accept trips, after coming under rising political and legal pressure on safety and working conditions.

Last year Uber also lost its first appeal against an employment tribunal that judged a group of Uber drivers to be workers, not self-employed contractors as it had claimed — meaning they are entitled to workers rights such as holiday and sick pay.

Uber also had its license to operate in London withdrawn last fall, with the local transport regulator citing concerns about safety and corporate responsibility as key considerations for not renewing the company’s private hire vehicle license.

Tluszcz’s view is that such moves prefigure a more major shift incoming in Europe that could cement permanent roadblocks to business models that function via intentional worker exploitation.

“The flaw in the [gig economy] model as a worker is so big that it seems to be quite clear that European governments are going to be looking at this and saying this is just not the European ethos. It’s just not,” he argues. “There’s going to be a moment when all these things are clashing. And I think it’s a cultural clash that we have really, between European values of equity and American values of just pure market capitalism.

“You can’t expect somebody making $3.37 an hour to take a part of that to contribute to retirement and social coverage. What the hell do you live on?” he adds.

“We’re creating the next lost generation of people who simply don’t have enough money to live and those companies are fundamentally enabling it under the premise that they’re offering a cheaper service to consumers… And I just don’t think Europe will put up with this.”

Last month the UK government confirmed its intent to act on this area by announcing a package of labor market reforms intended to respond to changes driven by the rise of gig economy platforms. It dubbed the strategy a ‘Good Work Plan’ — billing it as an expansion of workers rights and saying “millions” more workers would get new day-one rights, coupled with a tighter enforcement regime on platforms and companies to ensure they are providing sick and holiday pay rights.

“We are proud to have record levels of employment in this country but we must also ensure that workers’ rights are always upheld,” said the UK prime minister, also emphasizing that her goal was to build “an economy that works for everyone”.

It’s likely to publish more detail on the employment law reform later this year. But the direction of travel for gig economy platforms in Europe looks clear: Away from being freely able to exploit legal loopholes and towards a much more tightly managed framework of employment and workforce welfare regulations to ensure that underlying support structures (such as the UK’s national minimum wage) aren’t just being circumvented by clever engineering and legal positioning.

“This for me is an inherent dilemma one has between capitalism and some level of socialism which we have in Europe,” adds Tluszcz. “This is a clash of two fundamentally different views of the world and ultimately as a company you have to be a company that views your role in society as one of being a contributor — and tech companies can’t hide behind the fact; they must do the same.

“And unfortunately all these ride-sharing businesses, and including most of these gig economy companies, are just trying to take advantage of holes and frankly I don’t see them at all looking at their reason to be as at least having a component of ‘I’m good for the society in which I operate’. They don’t. They just simply don’t care.

“That’s a dilemma we have as consumers, because on the one hand we like the fact that it’s cheap. But we wish that people could all have a decent living.”

Whether US companies will be forced into a less exploitative relationship with their US workers remains to be seen.

Tluszcz’s view is that it will need some kind of government intervention for these types of companies to rethink how their models operate and who they are impacting.

“Tech companies frankly have an equal amount of responsibility to be great corporate citizens. And right now it feels — particularly because many of these tech companies are born in the US — it almost feels like this Americanism about them says I don’t have to be a good corporate citizen. I’m going to take advantage of the world for me and my shareholders,” he says.

“I’m a capitalist but I do think there’s some moral guidance you have to have about the business you’re building. And the US tech companies, around the world — certainly in Europe — are being highly criticized… Where is your moral compass? And unfortunately, today, sitting here, you have to say they lost it.


$100 Million in Speed Trap Revenue: Speed-camera tickets doubled last year in D.C., new data shows

by Sean Riley


The Washington Post

The District issued almost a million speed-camera tickets last year, according to data released Wednesday, cementing the city’s regional reputation as a “speed trap” for residents and visiting motorists alike.

The number of tickets — which led to $99.2 million in revenue for the city — was nearly double that issued the previous year, according to AAA’s Mid-Atlantic chapter, which obtained the figures through a public-records request to the District’s Department of Motor Vehicles.

The District’s citations also far exceeded those in neighboring jurisdictions, according to the data collected by AAA. The District issued 994,163 speed-camera tickets, compared to 529,993 in Montgomery County and 263,302 in Prince George’s County. Virginia is prevented by state law from using speed cameras.

A D.C. police spokeswoman said the department could not independently confirm AAA’s figures.

The dramatic increase could revive debate about the cameras, which have caused controversy in many cities across the country where they have been set up.

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In the District, being caught by a camera results in a ticket that can range from $50 to $300, depending on speed.

Research has shown that the presence of speed cameras leads to safer driving. But many motorists have mixed feelings about them, and some have argued that their true purpose is to serve as a cash cow for the governments that use them.

AAA Mid-Atlantic spokesman John B. Townsend II said the extraordinary number of tickets issued during the 2016 fiscal year suggested that the cameras were not deterring speeding and that they may be set up in a manner to “entrap and ensnare motorists as they come into the city.”

“What is astounding to us is the sheer number of tickets,” Townsend said. “Something is wrong when you’re issuing a million tickets a year.”

However, Townsend said he had no proof that the cameras had been set up with anything other than public safety in mind and said the purpose of AAA’s publication of the figures was merely to warn motorists that they should obey speed laws — especially in the District.

“This was more to let people know, and not to call for a policy change,” Townsend said.

Margarita Mikhaylova, a spokeswoman for D.C. police, said officials did not know what specific factors might be behind the sharp uptick in tickets but that “we would not be surprised that there was an increase given that MPD has improved a number of internal processes associated with our photo enforcement unit.”

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Miami Ends its Red-Light Camera Program: Unfair, Unsafe & Unnecessary

by Sean Riley


National Review

Starting next month, drivers in Miami will no longer have to hold their breath when passing under a yellow light, now that the city council has voted to end its red-light-camera program. In last year’s elections, Francis Suarez, the successful candidate for mayor, made a campaign promise to cancel the city’s 2010 contract with American Traffic Solutions, arguing that the cameras hurt residents with excessively high fines but didn’t make the roads any safer. Other localities would be wise to follow Miami’s lead and scrap their cameras. Red-light cameras are touted by their promoters –– predominantly camera manufacturers and law-enforcement agencies, which profit from them –– as a way to make America’s roads safer. For local officials, it sounds like a win-win: More money for the government and safer streets for everyone. But the data tell a different story: These cameras have actually led to an increase in motor-vehicle accidents in many cities, since drivers either speed up or slam on the brakes at yellow lights, hoping to avoid a ticket.

A 2016 report from the Florida Department of Highway Safety and Motor Vehicles found that intersections with red-light cameras saw increases in nearly every type of accident in the years since the cameras were installed. Rear-end crashes went up 11.41 percent, angle crashes went up 6.42 percent, and crashes involving injuries went up 9.34 percent. Fatalities from accidents doubled. Similar trends can be seen across the nation. Cities including Los Angeles, Chicago, Philadelphia, and Washington, D.C., have all seen increases in crashes at intersections where red-light cameras have been installed. In Los Angeles, the number of accidents increased at 20 of the 32 camera-equipped intersections. Three other intersections saw accident numbers remain the same, and only nine saw a decrease.

Sometimes the cameras help reduce one type of accident but increase another. In Chicago, the city with the most red-light cameras, the cameras may have lowered the number of T-bone (broadside) collisions by 15 percent, but the number of injury-causing rear-end accidents went up by 22 percent. One could argue that T-bone collisions are often more dangerous than rear-end crashes, but the most recent data from Illinois’s Department of Transportation show an increase in traffic fatalities in Cook County, which contains Chicago, despite the ubiquity of these cameras.

Even though the perceived safety benefits have been disproven wherever these cameras have been tried, some in government defend them as revenue-raisers for cities strapped for cash. This line of thinking is perverse and backward. Cities shouldn’t be able to extort money out of a resident who passes under a light right as it turns from yellow to red. If the light in the other direction has yet to turn green, that driver is putting nobody in harm’s way. This is essentially another tax imposed by cities on their residents, and a highly unfair and regressive one. In Miami, officials expected to collect $10.5 million during the current fiscal year on citations from the cameras. Of that, $4.4 million would go to American Traffic Solutions and the rest to the city coffers. That money will vanish when the city and American Traffic Solutions end their contract. But, as Suarez put it on Twitter, “It is necessary to defend #Miami’s most vulnerable residents from continuing to be overburdened by these excessive fines.”

Cities should instead consider stationing law-enforcement officers near dangerous intersections and allow them the discretion to pull over those who are truly driving in a dangerous manner, instead of simply ticketing every driver who has the misfortune of passing under a light as it turns from yellow to red. If someone does run a red light and cause an accident, witnesses can corroborate the story and proper charges can be brought.

Some cities have gotten especially carried away with their revenue-raising ambitions. In Chicago, officials were caught speeding up yellow lights so they would turn red quicker than the city’s minimum of three seconds. That led to 77,000 additional tickets’ being written in 2014, creating $8 million in new revenue for the city. If it weren’t for inquiries from the Chicago Tribune and Inspector General Joseph Ferguson, citizens in the Windy City would have had no idea that this abuse was taking place.

The sketchy dealings of red-light-camera companies are not unique to Chicago. In Columbus, Ohio, the CEO of RedFlex, the city’s red-light-camera vendor, was charged with bribing city officials in exchange for a contract. Similar actions have reportedly taken place in 13 states throughout the U.S. If the goal of red-light cameras is to make roads safer, they’ve been a complete and utter failure. All these cameras are good for is extorting money out of drivers without making the streets any safer.


DC DMV computer glitch affects 70K tickets; erroneously sends nearly 2K to collections

by Sean Riley


WJLA.com

A major computer glitch has impacted 70,000 speed camera tickets issued to drivers.

Roughly 1,900 of the 70,000 tickets should have been dismissed, but the DC Department of Motor Vehicles sent 1,773 of the tickets to collections.

The following statement is attributed to a DMV spokesperson from January 23, 2018.

In June, our ticket processing vendor determined approximately 70,000 tickets submitted on-line for adjudication and suspended for mail adjudication were not properly processed. A recent programming change resulted in these tickets not being pushed to the workflow queues for hearing examiners to review and decide. Once the issue was discovered, these tickets were pushed to the hearing examiners’ queues to review and decide. DC DMV regulations require us to answer a Request for Reconsideration within 180 days or dismiss the ticket. The vendor identified the requests for reconsideration that were more than 180 days (approx 1,700), and they were administratively dismissed by DMV. A letter was sent to customers informing them of this legal requirement, the dismissal of the ticket and that they were not required to do anything further.


Vast Majority Of Maryland Speed Camera Revenue Comes From PG County & Mo County

by Sean Riley


Wamu.org

Montgomery and Prince George’s Counties are responsible for more than three-quarters of Maryland’s speed camera tickets according to a new analysis by AAA Mid-Atlantic. More than 1.5 million speed camera tickets were doled out in Maryland between July 1, 2016 and June 30, 2017, and the combined number of tickets from Montgomery and Prince George’s Counties account for 76 percent of the state total.

Over that period, Maryland netted a grand total of $62,237,840 from fines, which cost motorists up to $40 a pop. “It is so shocking that so many drivers have a wanton disregard for safety,” John B. Townsend II, AAA Mid-Atlantic’s Manager of Public and Government Affairs, said in a statement. “In the course of three years, motorists incurred nearly five million speed camera tickets that carried $188,478,440 in fines, a mind-boggling sum.”

Are drivers in Montgomery and Prince George’s Counties more likely to be wanton speed demons, or are there other forces at work? According to AAA Mid-Atlantic, the answer lies in the number of photo-radar cameras in those counties. More than 83 percent of the state’s 432 speed cameras are in Montgomery and Prince George’s Counties. County police departments are responsible for about half of the cameras, while the cities of Bowie, Takoma Park and Hyattsville have set up additional cameras of their own.

Tickets are issued to drivers traveling at least 12 miles per hour faster than the speed limit. Local jurisdictions are required by state law to appoint an ombudsman to investigate contested tickets. Maryland speed cameras can only be posted in school and work zones, though in Montgomery County, a network of neighborhood speed cameras were grandfathered into the program.

The AAA analysis also shows that there has been a slight decrease in the number of speed camera tickets over the past 3 years, from 1,599,594 in FY15, to 1,556,441 in FY16, to 1,555,946 in FY17.

Virginia does not allow speed cameras, while the District very much does. D.C. collected close to $100 million in revenue from speed cameras in 2016. A speed camera fine in the District costs between $50-$100 per ticket.


More Than 4,000 Uber Drivers Fail Maryland Screening

by Sean Riley


WashPost

Maryland has booted more than 4,000 of the state’s ride-hail drivers off the roads since December 2015, because they failed to meet the state’s screening requirements, despite passing Uber and Lyft’s background checks, according to the Maryland Public Service Commission.

The commission, which regulates ride-hailing in Maryland, said 6 percent of the app-based drivers have been booted since the state began processing ride-hailing applications at the end of 2015. The vast majority — nearly 97 percent — were driving for Uber, commission spokeswoman Tori Leonard said Monday. The review included 74,000 drivers.

Leonard said drivers can be rejected for a multitude of reasons, including criminal and driving history issues, failure to verify identity, too little driving experience, and being on a limited-term temporary license. The state doesn’t conduct its own background checks, but rather, processes applications, reviewing information provided in Uber and Lyft’s reports for compliance.

Leonard said a “good portion” of the rejections dating back to 2015 were not for criminal or driving-history related reasons, meaning they “would not present a safety issue,” but it was unclear if that pool made up a majority.

Uber said the PSC’s criteria for determining compliance often relied on subjective factors, rather than objective criteria. But it lauded Maryland for adopting new rules for vetting drivers earlier this year.

A breakdown of the rejections was not immediately available. The Boston Globe first reported the Maryland figure in a story that weighed Massachusetts’ ride-hailing background checks against other states’ screening methods.

Uber derided Maryland screening requirements as too vague in an August letter to the commission.

The “Commission’s regulations do not contain specific criteria to determine whether an individual’s criminal history should preclude them from operating as a [driver] in Maryland,” read the  letter from an Uber attorney. “Instead, the Division utilizes non-public guidelines for this review.”

Maryland later adopted an alternative screening process with more specific requirements, which would allow Uber and Lyft keep operating in the state without conducting fingerprint-based background checks preferred by some law enforcement officials. Uber had threatened to leave Maryland if fingerprint screening was mandated.

Instead, Maryland regulators said the ride-hailing companies should subject drivers to screenings that encompass their entire adult life — rather than simply going back seven years — and address concerns about identity verification, the comprehensiveness of record searches, and timely follow-up requirements.

[Md. approves alternative screening process for ride-hailing drivers, amid threats Uber would leave]

The revelation that thousands had been disqualified from driving, despite meeting Uber and Lyft’s initial requirements, was fodder for those who say ride-hailing companies are too lax in their screening.

Massachusetts has banned more than 8,200 of nearly 71,000 drivers who had already passed ride-hailing companies’ background checks, according to the Globe. Among them were 51 registered sex offenders and hundreds of others who were barred for sex-related crimes and violent incidents, the Globe reported.

It was unclear what proportion of drivers booted in Maryland were disqualified for safety reasons. Lyft said its drivers were most often disqualified for licenses marked “not acceptable for federal purposes” — a type of license issued to immigrants living in the country illegally, among others.  Still, the removal of thousands of drivers renewed concerns over the the efficacy of Uber and Lyft’s vetting.

The Virginia Department of Motor Vehicles did not respond Monday to an inquiry on whether similar issues were found under its ride-hailing law, which went into effect in mid-2015.


A Florida law would require TNCs to have $1 million in insurance coverage whenever their drivers are doing a run

by Sean Riley


TampaBay.com

Years of fighting among local governments, the Legislature and ridesharing companies such as Uber and Lyft could soon come to an end.

Lawmakers have sent to Gov. Rick Scott legislation that would prohibit local government from regulating the companies. Instead, the companies would need to meet statewide insurance and background check standards only.

The vote was unanimous in the House and nearly so in the Senate.

"This strikes the right balance of regulation and making sure that there's plenty of access for Floridians," said Sen. Jeff Brandes, R-St. Petersburg, who has sponsored the legislation in the Senate for the last four years.

Uber and Lyft have argued that being subjected to different rules in all 67 counties and more than 400 cities and towns made it hard to do business.

"We go from a patchwork of local regulations that were in conflict to each other to a statewide regime that provides harmony, stability and certainty for riders and drivers alike," said Colin Tooze, spokesman for Uber.

With the news of the law passing, Tooze refused to say what, if any, expansion Uber plans in the state.

Scott's office Wednesday said the governor is reviewing the bill.

Taxicab companies have fought against standardizing regulations statewide for ridesharing companies they compete with, saying that they hold Uber and Lyft to different standards than other vehicles for hire. Historically, local governments have been allowed to regulate taxi and limo services.

"Obviously we remain concerned about the lack of a level playing field," said Yellow Cab Co. of Tampa owner Louis Minardi, who is also president of the taxicab trade group the Florida Taxicab Association.

The bill's passage Wednesday ends years of infighting among lawmakers, particularly in the Senate, where leaders were reluctant to preempt local governments on ridesharing.

This year, the taxis' lobbying efforts fizzled.

Opposition among legislators also was hard to find. The only no vote in either chamber was Appropriations Chairman Jack Latvala, R-Clearwater.

Asked by the Times/Herald if he would talk about his opposition Wednesday, he rushed off the Senate floor and said, gruffly: "No."

If signed by Scott, the law would require ridesharing companies to have $1 million in insurance coverage whenever their drivers were engaged in a ride, as well as heightened requirements when logged into their smartphone apps but not driving a passenger.

Additionally, there would be statewide standards for background checks.

Brandes said it is also a step forward in what he views as the long-term future of transportation: a network of driverless cars run by ridesharing companies.

For Uber drivers, the move settles uncertainty in some jurisdictions, including Key West and Broward and Hillsborough counties, which at varying times in recent years banned Uber and Lyft or ticketed their drivers.

"I think it was totally ridiculous that Uber had to be held hostage by each county and each quasi-governmental entity," said Marla Garris, an Uber driver who lives in Pinellas County. "It doesn't need to be gridlock with local government. We as Floridians need to be on the same page."

In Hillsborough, Uber and Lyft fought a more than two-year battle with the Public Transportation Commission, the agency that regulates for-hire vehicles.

Under pressure from local taxicab and limousine firms, the agency ticketed Uber and Lyft drivers for operating without commercial insurance and permits. The dispute ended when the agency's governing board in December narrowly approved a temporary agreement to regulate the companies.

Kevin Jackson, PTC interim executive director, said the Senate bill isn't just taking ridesharing regulation away from the PTC but from all local government in Florida. That raises the question of who will protect and represent ridesharing passengers, he said.

"From the customer standpoint, my question is where do they go for relief when there are problems or if they have a complaint or concern?" Jackson said. "I'm not sure who will be a strong responsive department or agency to handle those types of inquiries. "

Under the bill, regulation of ridesharing would fall to the Florida Department of Financial Services.

PTC board member David Pogorilich, said ridesharing drivers should have to pass fingerprint background checks and carry the same level of commercial insurance as is required of taxicab drivers.

"The traveling public are the ones who will suffer as a result of this," he said.

The bill will also pave the way for ridesharing firms to capture more airport and port pickups.

Although local authorities are precluded from regulating ridesharing firms, airport and port authorities would be able to negotiate deals to charge fees for passenger pickups similar to those it already levies on taxicab firms.

Uber already has such agreements in Miami and West Palm Beach where it pays $2.50 for every airport pickup. A spokesman said the company will likely begin negotiations with Tampa International Airport in the next few weeks.

Taxi companies would still be regulated by local officials for now, which didn't sit well with some drivers interviewed at TIA.

They say the PTC has done little to help them and that regulations they must follow put them at a competitive disadvantage. A bill to abolish the PTC is also under consideration in Tallahassee.

"We pay more than Uber. Uber doesn't pay anything," said Wilfrid Jeanty, 39, who has driven for Yellow Cab for seven years. "I don't care who's in control as long as it's equal. We don't feel like we're treated fairly."

Miguel Sanchez, a taxicab driver with 5 years' experience, said Uber should be subject to the same rules as taxicabs.

"I'm not feeling good. Nobody here is feeling good," he said.


San Francisco Government agencies increasingly in conflict with Uber

by Sean Riley


SF Examiner

So many San Francisco government entities are tussling with Uber right now, it’s a wonder City Hall’s basement eatery, the Mint Cafe, doesn’t also have a grievance with the company.

Two San Francisco transportation agencies filed legal missives Monday arguing Uber’s lax criminal background checks allow “sexual predators” to drive for the company, while Uber itself on Monday filed a legal motion against the San Francisco Treasurer’s Office to contest the release of Uber drivers’ addresses as public record when they file for business licenses.

Additionally, Supervisor Ahsha Safai has requested the City Attorney’s Office explore litigation to reveal Uber’s impact on traffic congestion. And San Francisco business interests asked for help to curtail the ride-hail company’s traffic impacts, the San Francisco Examiner has previously reported.

Meanwhile, the San Francisco County Transportation Authority is also drafting a “white paper” on ride-hails to mitigate their impact on traffic congestion, at the behest of Supervisor Aaron Peskin.

Uber’s conflicts with The City are no surprise to Ed Reiskin, director of transportation of the San Francisco Municipal Transportation Agency.

“I’ve been seeing this pattern for many years now,” Reiskin said. At Uber, “there’s not a willingness to engage with The City on concerns, which are many.”

Uber did not respond to requests for comment on their background checks.

The SFMTA and the San Francisco International Airport jointly filed legal arguments for stricter criminal background checks for Uber drivers Monday with the California Public Utilities Commission, which regulates ride-hails like Uber and Lyft.

Much to Reiskin’s dismay, the CPUC’s regulatory authority over Uber and Lyft leaves little legal ability for the SFMTA to do anything about Uber’s criminal check system, its impact to traffic or other issues concerning The City.

“I met with business leaders last week. They say, ‘Can’t you do something about all these vehicles?’” Reiskin said.

“It’s frustrating to be the director of transportation of San Francisco,” he continued, and to see Uber’s “incredible adverse impact on San Francisco and have no ability to do anything about it.”

It’s a matter of safety, according to the SFMTA’s legal filing.

The SFMTA argued Uber’s criminal checks did not identify many drivers with criminal histories that should have disqualified them to drive, one of which allowed a driver with “criminal convictions involving lewd acts against a child and sexual exploitation of children,” to drive on its platform.

These drivers were only discovered after research performed by District Attorney George Gascon, who previously sued Uber, the SFMTA wrote in its filing.

Uber uses third-party criminal checks that rely on name checks only, whereas taxi drivers use fingerprint checks linked to the FBI’s database. The SFMTA urged the CPUC to adopt a system similar to the taxi industry’s, as names can easily be faked.

In legal filings, Uber argued its third-party checks are as effective as FBI criminal background checks, but did not directly address those with criminal histories found on its platform.

Meanwhile, Uber’s fight with the Treasurer’s Office intensified as Uber moved to rebuff its subpoena for driver data, which it needs to request drivers file for business licenses to drive in San Francisco.

Uber San Francisco’s General Manager Wayne Ting wrote in a statement that the treasurer published drivers’ home addresses without their consent.

“We’ve asked The City to allow us to get the consent of drivers and to remove their personal information from the public website, but they have refused,” Ting wrote.

San Francisco Treasurer Jose Cisneros said in a statement, “Uber will not get special treatment on taxes in San Francisco. My duty as treasurer is to fairly enforce the law, and I am confident this subpoena will be enforced by the court.”

Steven Hill, who helped craft San Francisco’s ranked-choice voting system and is the author of “Raw Deal: How the ‘Uber Economy’ and Runaway Capitalism are Screwing American Workers,” said Uber’s privacy woes are far-fetched.

“If you open a business, you forfeit a degree of privacy,” Hill said, noting that Uber has treated its drivers as independent contractors — essentially small-business owners — who are now required to file the same data as any business.

At the Board of Supervisors meeting Tuesday, Peskin said The City’s recent legal win against Airbnb set the stage for future tussles with Uber.

“Businesses should be treated fairly and equally under the law, and that includes powerful special interests like Uber,” he said.

Yet even as San Francisco wrangles Uber on multiple fronts, state lawmakers are working to seemingly circumvent cities with state laws that would enact the ride-hail giant’s interests.

Senate Bill 182, authored by state Sen. Steven Bradford, D-Gardena, would allow drivers to file for one business license to operate statewide, instead of city by city, which may circumvent Cisneros’ effort to request drivers file in San Francisco.

Bradford’s bill outlines concerns, and reads, “Since most [ride-hail] drivers only drive part-time, it is cost-prohibitive to secure licenses for every jurisdiction that they work in.”

As state lawmakers draft more bills loosening ride-hail regulations, Uber has stepped up its statewide campaign contributions.

Though the Examiner found no contributions to Bradford from Uber, the ride-hail giant contributed $50,000 last November to the Technet Political Action Committee, which contributed to lawmakers across the state, including $3,000 to state Sen. Scott Wiener, D-San Francisco, in November 2016.

Locally, opposition to Uber is on an agency-by-agency basis, with one exception.

When Uber ran self-driving cars without permits that the California DMV said were needed, Mayor Ed Lee spoke directly to Uber CEO Travis Kalanick and demanded he remove the vehicles from city streets.

But as far as these larger regulatory concerns go?

“Mayor Ed Lee has been missing in action on these companies for several years now,” Hill said. “It’s a big problem. It means The City is not speaking in one voice.”

Correction: An earlier version of this story incorrectly referred to a legal motion made by Uber against the Treasurer’s Office’s subpoena as a lawsuit.


Uber’s headaches continue with criminal probe of its use of ‘Greyball’ software

by Sean Riley


ThinkProgress

The Justice Department is investigating Uber for its use of software that helped drivers dodge local transportation regulators trying to catch the company operating illegally, Reuters first reported.

The criminal probe, which is in the early stages, comes two months after the New York Times reported that Uber used so-called “Greyball” software to operate in areas where the the service was restricted and to avoid government officials worldwide.

Uber has been subpoenaed by a grand jury in Northern California to provide documentation regarding how and where the Greyball technology was used. The main issue is that at the tool was used to trick certain users, showing them a different version of the app with false location data on Uber drivers.

The ride-hailing company suspended use of the program in March but also admitted that the software was intended to help drivers get fares in areas where the service wasn’t yet approved.

Greyball was created in 2014 for primarily international use and was a part of the company’s “Violation of Terms of Service” program, which focused on potential abuse of the service. Greyball used data from consumers’ devices, credit cards, and GPS information to obscure Uber drivers’ true location.

Although Greyball’s official and legal use was for TOS violators, the company also said it was used to test new features, ascertain physical threats, marketing, anti-fraud tactics, among other things.

The federal investigation is the latest in a long list of woes mounting for Uber this year. Thousands of customers deleted the app after the company’s lukewarm response to President Donald Trump’s immigration travel ban and subsequent protests in January. The following the month, the company became embroiled in a sexual harassment scandal and is still continuing to feel the effects.

Additionally, CEO Travis Kalanick has had to do damage control after a video leaked of him berating a driver who questioned the company’s employment and pay policies. Uber is also in the midst of a legal battle with Google over alleged stolen self-driving car technology.

Uber hasn’t publicly commented yet on the preliminary federal investigation.


Are Uber Black drivers in D.C. being targeted by Hack Inspectors?

by Sean Riley


WJLA

Is the District targeting Uber Black drivers? 7 ON YOUR SIDE Investigative Reporter Scott Taylor dives into complaints about profiling that has some drivers upset and facing thousands of dollars in fines.

The I-Team watched as an Uber Black driver dropped off his passenger in the heart of the District and quickly gets pulled over by an enforcement officer with D.C.'s For Hire Vehicle Department.

"Why did you pull him over?" ABC7 News asked.

"Safety and compliance inspection," An enforcement officer said.

"Why was that?" ABC7 News asked.

"We can do that," The enforcement officer said.

Uber Black drivers say random stops by enforcement officers are creating tension on the streets.

"Of course they are profiling us," Kamran Mahdi, who drives for Uber Black, said. "Of course we know that."

Drivers say they are getting hit with multiple citations during a single stop.

"$3,700 in tickets. I can't pay that," Mahdi said.

The citations include: failing to provide a manifest, loitering in a taxi or limo area, unlicensed D.C. limo operator and more.

"Four tickets in and you are already over a $1,000," Taylor said to Uber Black driver Khalid Khan.

“I'm not done. Limousine owner permitting unlicensed operator $500," Khan said.

The I-Team discovered D.C.'s database that tracks tickets needs an upgrade. It only tracks two groups, one for taxi cabs and everyone else is tossed into another group.

As of Friday, the District had no idea how many tickets are being handed out specifically to Uber Black drivers.

D.C.'s For Hire Vehicle Department Director Ernest Chrappah says he hasn't received any official complaints.

"Do you think your enforcement officers target Uber Black drivers?" Taylor asked Chrappah.

"No. They are not trained to do it. It is illegal. What they do is apply the law evenhandedly to everyone,"Chrappah said.

Last year, enforcement officers wrote more than 15,000 tickets. Approximately 581 citations, or only three percent, included Uber, Lyft and other private for hire vehicles.

"He towed away my car and the cost of everything came into the thousands," Humberto Misteroni, who has driven for Uber Black, said.

"DCTC has to change their tactics. These are old tactics. 50 years ago. 60 years ago," Mahdi said.

Creating more tension? Only during rush hour and with a Special Event decal due to Safe Track can Uber Black pick up and drop off without leaving D.C.

“Extremely difficult to a point I don't even want to go thru DC," Misteroni said.

After ABC7 News started asking questions about Uber Black citations, Chrappah created a program that allows drivers a voice.

"We launched the Ombudsman program," Chrappah said. "If you have an encounter with a vehicle inspection officer and you feel something was off, you have the right to report it to us confidentially and we will investigate."

Chrappah admits the department needs to do a better job.

“The Government doesn't need to know everything. However, being in a position where we can inform the public about the disproportionate number of tickets is something that is worth pursuing," Chrappah said.

Uber DC and the District recently reached an agreement to resolve $986,000 worth of contested citations.

Following the agreement, Uber DC and the District both released statements. Read them below:

Uber DC spokesperson: “With this agreement, Uber DC and the DFHV have made substantive progress toward resolving legacy issues on behalf of the black car drivers who choose to partner with us. At the same time, we’re working together to make meaningful contributions toward a better, smarter, and more inclusive local transportation system in the District.”

D.C. Department of For-Hire Vehicles: “The resolution to legacy ride sharing regulatory compliance issues builds trust and fosters a climate of cooperation between regulated entities and the regulator. This settlement builds on the efforts of DFHV to ensure that residents and visitors continue to have access to safe, affordable, and accessible transportation. As part of the agreement, Uber will contribute $25,000 to increase access to wheelchair accessible transportation services and $240,000 to help reduce costs and encourage more shared rides on uberPOOL to and from DC metro stations. Uber will also pay an additional $160,000 to the District to resolve this outstanding issue.”


Transportation Analyst says Uber Is Making NYC Gridlock Worse

by Sean Riley


NYCStreetsBlog

2/27/17     The controversy over Uber’s impact on Manhattan traffic has been settled. Uber, Lyft, and other app-based ride services are unequivocally worsening gridlock in the Manhattan core as well as northern Manhattan and the western parts of Queens and Brooklyn, according to a report released today by transportation analyst Bruce Schaller.

The new ride services, known as transportation network companies, or TNC’s, last year caused a net increase of 600 million vehicle miles traveled in the five boroughs — a 3 to 4 percent jump in citywide traffic, Schaller found. This trend marks a troubling inflection point — for the first time in many years, car-based services, not transit, account for most growth in travel.

To head off a downward spiral of increasing traffic and declining transit use, it’s incumbent on Governor Cuomo and Mayor de Blasio to prioritize projects with wide-ranging impacts on the transportation system: subway signal upgrades, citywide off-board fare collection for buses, a comprehensive expansion of bus lanes and transit priority at intersections, and road pricing that factors in the impacts of TNC’s.

In 2013, the last year before Uber’s presence was felt, use of subways, buses, and bicycles grew substantially (see below). But by 2016, net growth in travel by Uber and other TNC’s far outstripped growth in those modes (see HERE).

Most of the upsurge is occurring outside the city’s Central Business District (Manhattan below 60th Street), Schaller reports. Nevertheless, he identifies growth in use of TNC’s as a prime cause of the 11 percent slowing of traffic in the Manhattan CBD from 2013 to 2016 noted in the mayor’s management report last September.

Schaller is highly regarded in transportation circles, and his report — “Unsustainable? — The Growth of App-Based Ride Services and Traffic, Travel and the Future of New York City” — will be widely read and carefully studied. Before serving as a top deputy to transportation commissioners Janette Sadik-Khan and Polly Trottenberg, Schaller’s career included stints at MTA NYC Transit and the city’s Taxi and Limousine Commission, and his annual NY Taxicab Fact Books made him the go-to expert on for-hire vehicles.

In his new report, Schaller set out to determine not just how fast Uber and the TNC sector have grown, but which modes they are displacing. Here are some key findings:

  • In a marked reversal from the transit-oriented growth that lasted from 1990 to 2014, growth in for-hire vehicle use (TNC’s, yellows, greens, and all car services combined) is outstripping growth in transit ridership, making it the city’s leading source of growth in non-auto travel.
  • The estimated 7 percent net addition to vehicle mileage caused by TNC’s in Manhattan, western Queens, and western Brooklyn is the same magnitude as the decrease in vehicular travel that was expected from the 2007 Bloomberg congestion pricing proposal.
  • These trends only became apparent in the last year and a half, as TNC ridership tripled between June 2015 (the end of the period that City Hall examined in its December 2015 for-hire-vehicle transportation study) and the fall of 2016.

These developments are virtually certain to continue, Schaller asserts, fueled not just by the convenience, dependability, and cachet of Uber and other TNC’s, but by their low fares. Traditionally, a ride in a taxicab was four to five times as expensive as a subway or bus ride, which acted as a brake on usage. Now, however, “TNC fare offerings for shared trips during rush hour in Manhattan put TNC fares at less than twice the transit fare, dramatically weakening the disincentive to travel by auto,” Schaller concludes.

The resulting “reversal from transit-led to TNC-led growth in travel,” as Schaller characterizes it, “will have profound implications for the city’s transportation network if current trends continue.”

The app-based ride services were expected to confer an efficiency upgrade as they replaced taxi cruising (driving between fare trips) with swift arrival of the nearest available vehicle. Instead, deadheading is more prevalent with TNC’s, as Schaller found by painstakingly examining trip records available from the Taxi and Limousine Commission. Whereas taxi cruising tends to add seven to eight miles for each 10 miles of fare trips, the app-based vehicles tack on 12 to 13 miles. The difference is a big force-multiplier to gridlock.

The prospect of unconstrained growth in TNC traffic — and the concomitant worsening of gridlock and rise in emissions — lends new urgency to efforts to improve subway and bus performance.

Instead of dubious projects like Cuomo’s AirTrain to LaGuardia and de Blasio’s Brooklyn-Queens streetcar, the city’s political leadership needs to shift focus and deliver projects that will speed up the transit system as a whole. Modernizing subway signals to allow trains to run closer together, speeding up bus boarding with off-board fare collection, and prioritizing transit on city streets are “far more critical than headline-grabbing but low-ridership distractions like the LaGuardia AirTrain and BQX streetcar,” Schaller says.

The report also “raises the need to return to the subject of road pricing,” he writes. The Bloomberg congestion pricing proposal won’t suffice, he notes, since it would have let for-hire vehicles operate all day and run up congestion costs while paying just one toll.

The Move NY plan devised by traffic guru and former City Traffic Commissioner Sam Schwartz surmounts that problem via the on-board GPS now found in all TNC vehicles as well as yellow and green taxis. Charging for-hire vehicles by the mile and by the minute in the “taxi exclusion zone” (south of 110th Street on the West Side, and 96th Street on the East Side), as Schwartz proposes, would discourage their use and also add to revenues to finance transportation improvements.

Read Schaller’s report and take the time to digest its implications. It touches on virtually every consequential transportation trend and policy question facing the five boroughs and stands as the most thoughtful and thorough analysis of New York City traffic and transportation issues since the Bloomberg years. Give it a deep dive, and join me in congratulating Bruce for advancing the discussion on many fronts.


Prius plug-in solar roof is not safe enough for U.S. markets, report says

by Sean Riley


Toyota’s new Prius plug in hybrid might be eco-friendly, but apparently it’s not safety-friendly — at least, not enough for American roadways.

The next-generation Prius plug-in, called the Prius PHV, comes complete with a roof topped with solar panels that recharge the onboard batteries with the sun’s rays. Or it does in Japan and Europe, anyway.

In the American market, Toyota has had to remove the solar panels on its latest green machine. Its reinforced-glass panels don’t pass America’s strict rollover crash tests.

Toyota doesn't have the technology to create solar panels resilient enough to meet U.S. standards. At least, not yet.

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Koji Toyoshima, chief engineer of the Prius plug-in, told Automotive News that the carmaker hopes to remedy this within the lifespan of the current Prius — which is to say, within the next five years.

Toyoshima points out that a lot of recharging could happen without any plug at all, in areas like California and Arizona that see a lot of sunlight.

Until Toyota figures out how to make stronger solar panels, plug-in hybrid owners that want to charge their car off the sun will have to buy solar panels for their home.


Fed-up taxi industry threatens to yank wheelchair-accessible cabs in NYC

by Sean Riley


NY Post

2/13/17 The flailing yellow-cab industry appears to be trying to blackmail the city into bailing it out — threatening to yank its wheelchair-accessible cabs off the street.

David Beier, president of the Committee for Taxi Safety, which represents 20 percent of the city’s yellow-taxi medallion agents, told The Post that medallion owners are near the breaking point.

He claims the industry’s financing is in jeopardy because a major medallion lender was taken over by state authorities last week. And owners gripe that app-based competitors, such as Uber and Lyft, are getting a free ride regarding regulations.

“Without the necessary financing in place, there may be no choice but to shut down the entire accessible-taxi program within months,” Beier said, referring to the city’s more than 1,400 specially equipped cabs.

Hundreds of standard cabs could follow suit because of the plummeting values in the taxi-medallion market, industry advocates said.

Beier’s group and others are demanding that the city either bail them out or start coming down hard on regulating the app-based services — or do both.

The threats aim to ramp up the pressure on Mayor de Blasio, who has called on the industry to start innovating instead of complaining about competition.

Under the terms of a settlement of a 2013 federal lawsuit by advocates for the disabled, 50 percent of the city’s taxi fleet must be wheelchair-accessible by 2020.

The city and the taxi-fleet owners, which operate about 60 percent of the 1,497 accessible yellow cabs, are both required to meet the mandate. The entire yellow-taxi fleet consists of 13,587 medallion vehicles.

Taxi advocates grumble that the special vehicles are costly to maintain. City officials have shot back that there are government subsidies available to cover much of the extra costs.

Dustin Jones, of United for Equal Access New York, said Hizzoner will ultimately be held responsible by disabled riders if the special vehicles disappear.

“If Mayor de Blasio lets the accessible-taxi program die, he shouldn’t expect New Yorkers with disabilities to vote for him this year,” he said.

But de Blasio has indicated he has no interest in either bailing out the taxis or subjecting the app-based cab companies to more regulation.

When a yellow-cab driver called in to his weekly WYNC radio show Feb. 3 asking about a possible bailout, de Blasio said he’d rather leave it up to the market.

“I think you will see some leveling off [of the market] over time, and that could strengthen the medallion values again, but I am not ready to commit to reversing course,” de Blasio said.

“I also think there were free-market dynamics that created an opening for Lyft, Uber and others, and the taxi industry has to learn from that . . . in every way possible.”

Allan Fromberg, spokesman for the Taxi and Limousine Commission, said, “Frankly, it is surprising to me that, with New York City being the only city in the nation that licenses and regulates app services like Uber and Lyft just as it does for all other for-hire service providers, this group prefers to cloak its beef with competitors in a speculative ‘prediction’ that accessible taxi service will disappear within a matter of months.”

City Hall spokesman Austin Finan echoed that sentiment Monday in a statement to The Post.

“Yellow cabs are an iconic part of New York City, but it’s on their industry to adapt and keep pace in the vibrant and growing for-hire market,’’ he said.

Beier said the taxi industry is “committed to providing accessible service, but the city’s failure to create a level playing field with Uber could make that impossible.

“Although the TLC claims Uber is regulated just like the taxi industry, the reality is that Uber has an unfair advantage because it is not required to utilize accessible vehicles.”


Uber drivers in Survey Say They Earn $15.68 an hour but disparities are significant

by Sean Riley


WashPost

A survey of Uber drivers found that their average salary is $15.68 before deducting expenses  – or just a little above what labor advocates have been pushing for the minimum wage.

The survey of active drivers for Uber, Lyft and other rideshare services also found that Lyft is overall a better deal for drivers, both in pay and satisfaction.

But what’s perhaps most striking were pay disparities uncovered by the survey: African American drivers for Lyft and Uber reported making an average $13.96 an hour, compared to $16.08 for all Uber and Lyft drivers. Women earned less than men at $14.26 an hour.

In other words, the new gig economy is looking in some ways like the old one.

“The trend is, honestly, I think, not positive,” said Harry Campbell, who conducted the driver survey for his blog, The Rideshare Guy. “The pay is becoming more akin to a service worker like McDonald’s or like Burger King.”

[Is Uber the next big thing that goes kaput? This guy thinks so.]

Unlike the broader economy, however, the survey — which can be found here –found that younger drivers earned more. That finding that could mean that older drivers are less enthusiastic about driving at night and weekends, when fares are at their highest, Campbell said. It could also mean that older drivers encounter more hassles trying to make the technology work.

“The number one complaint I hear from older drivers? There’s no phone call to call at Uber,” Campbell said. “And it could be things as simple as just navigating the app.  Someone like me, who’s only 30, grew up with apps and smartphones and really understands how to troubleshoot, how to overcome the smallest of little problems. . .”

Campbell, of Los Angeles, is a former Uber driver who quit his job as an aerospace engineer to blog full-time about rideshare services. In 2013 he launched the Rideshare Guy, which gets more than 400,000 unique visitors a month.

Earlier this month, Campbell sent his survey to nearly 30,000 blog subscribers. He received 1,150 responses, up from 453 drivers last year. Most came from subscribers, with additional responses from social media or the blog itself, he said.

An online study of drivers conducted for Uber by Benenson Strategy Group found higher levels of satisfaction and more diversity. The Uber survey – which drew on 601 interviews in December 2014 and 833 interviews in November 2015 – said more than 80 percent of drivers were satisfied overall, especially with its flexible schedule. Twenty-four percent were African American, and 20 percent were Latino, Uber’s survey found.

Campbell said that, based on his discussions with drivers and the results of the Rideshare Guy survey, the fast-growing fleet of rideshare drivers is made up of older, college-educated white people who are hustling for pocket money in their spare time, often because they’ve been downsized from other jobs or they’re finding retirement tougher than they thought. A wage of $16 an hour doesn’t sound too bad until you start deducting the cost of fuel, car payments, taxes and so on.

“When you look at it, you know, 15 bucks an hour is not a lot of money,” Campbell said. “Yet Uber is still touting that this is sort of this new way of work. But I think the only thing new about it is the flexibility, to some degree. I think that’s the only value proposition to some.”

More than 78 percent of survey respondents identified themselves as white, compared with about 7 percent for African Americans and Latinos. More than 53 percent also said they had at least a bachelor’s degree, compared with a national average of 33 percent.

More than half the respondents said that less than half or very little of their income comes from driving for a rideshare firm. Only 201 people, or 17.5 percent, said all or almost all of their income came from working for Uber or the other companies.  The survey found, to no one’s surprise, that one of the most valued things about driving for Uber was flexibility.

The Rideshare Guy’s survey found that Lyft drivers gross $17.50 an hour on average and that drivers liked working for Lyft more than Uber: nearly 76 percent expressed satisfaction with Lyft, compared with about 49 percent for Uber. The study also found that Uber drivers prefer taking passengers arranged through a single call over UberPool’s service for multiple fares.

“[F]or me, that wasn’t necessarily a surprise, but it was for some people, seeing that Lyft drivers are a little happier [and that] Lyft drivers make a little more money,” Campbell said. “That’s sort of something I’ve always felt literally from day 1 when I started driving for Lyft and Uber three years ago.” [MORE]


Has Uber’s day of reckoning arrived?

by Sean Riley


WashPost

Uber has been burning capital for some time now. This includes not just real money but also that intangible commodity known as goodwill.

In recent weeks, Uber has taken the sort of beating that most taxi companies get only from a poorly maintained city street. A string of embarrassing disclosures has led some longtime company observers to wonder how long the ride-hailing service will be around — or at least how long co-founder Travis Kalanick will be its chief executive.

“Uber is doomed,” Jalopnik pronounced last month in an article explaining why the money-losing venture would end up in a ditch. And that was before the run of bad news accelerated. The Atlantic’s CityLab also sees a cloudy future for Uber, but not as dark as others may forecast. Among the painful disclosures in recent weeks:

  • Uber developed a secret weapon to evade regulators. Known as “Greyball,” the software was designed to fool hostile traffic officials into thinking they were hailing rides through the app when in fact Uber was making sure that drivers avoided picking up undercover agents who might be part of a sting. On Wednesday, the San Francisco-based company said it would stop using the tool to thwart regulators. Use of the software was first reported by the New York Times.
  • Former employees say that Uber, which launched a self-driving vehicle project in San Francisco last year without the approval of California state regulators, later blamed human drivers for serious lapses caused by its technology, the Times also reported. Citing accounts from former employees and Uber documents, the news organization said the company’s autonomous cars blew through six red lights because of flaws in its mapping technology.
  • Kalanick received the sort of publicity no one would want after Bloomberg published a video of the CEO arguing with one of his drivers about pricing policy. “I lost $97,000 because of you. I’m bankrupt because of you,” the driver says in the video. Kalanick’s temper heats up as the exchange continues. “You know what, some people don’t like to take responsibility for their own,” Kalanick says in the video. “They blame everything in their life on somebody else. Good luck!”

The argument — which was captured by a dash cam — went viral, leading Kalanick to issue an apology later.

  • A self-driving car company that had been created by Google filed a lawsuit accusing Uber of stealing technology. The lawsuit, filed by Waymo, says a former tech wiz who now works for Uber raided his former employer’s servers before leaving.
  • A barrage of stories suggesting that Uber has fostered a male-dominated libertarian corporate culture that Ayn Rand might find creepy and over-the-top. Susan J. Fowler, a former site-reliability engineer, said in a blog post last month that sexual harassment was common and sometimes winked at by higher-ups. The company’s frat house rep has become so well known that former Uber employees now have to “prove” they’re not jerks, according to an account in the Guardian.

For some, Uber’s turnabout is the stuff of Greek tragedy, a form of divine justice directed toward a company whose credo has been growth at all costs, even if it meant breaking all the rules.

“It’s sort of the culture that got them there,” said Harry Campbell, a ride-hailing driver who runs the Rideshare Guy blog. Now, many people are acting as if they’re not so sure they like what they used to cheer on, back in the days when Uber was the upstart overturning the taxi and limousine business city by city, before the underdog became the uber-dog.

Campbell said the two most devastating stories in the recent cycle of bad press for Uber are the sexual harassment allegations and the dash cam video — and that might be enough to knock any company off balance.

“Now, with the pile-on, it shows it’s more systemic,” he said.

Steven Hill, who wrote about Uber in his book about the sharing economy, compared Uber’s alleged deception about its autonomous vehicles to the practices of Big Tobacco. Uber is betting big on developing an autonomous fleet of driverless taxis, but it has also been accused of deceptive claims about its self-driving program before. Last September, Uber launched a self-driving demonstration in Pittsburgh that was designed for maximum media attention. It was supposed to show that the company was making progress in its plan to put a fleet of autonomous vehicles on the road. [MORE]


Las Vegas Taxi Union Demands State Crack Down on Competition from Ridesharing Apps

by Sean Riley


Reason.com

A Las Vegas taxi union is asking the state to step in and squash competition from ridesharing services like Uber and Lyft and "illegal" drivers who were "taking food out of the mouths of" taxi drivers, as Theatla Jones, a representative of Local 4873 of the Industrial Technical Professional Employees Union, wrote in a letter to legislators obtained by The Nevada Independent.

"Working in the Las Vegas taxi industry was traditionally a solid job where a driver could support his family and enjoy benefits such as health insurance, dental/vision care, retirement benefits, vacation pay, and safety bonuses, but those days are gone unless we secure your help," Jones wrote to legislators. Taxi drivers "desperately need your help to survive due to unfair competition from and lack of regulation

Jones offered sixteen proposals and The Independent reports that one Democratic state senator says he's planning to introduce legislation Monday that incorporates some of them. Jones' proposals include "public safety" measures like FBI background checks, drug testing, and 24-7 commercial insurance, some of which most ridesharing services already do. "Taxi drivers have reported that they recognize [ride-share] drivers who have been terminated from taxi companies due to drug and or alcohol issues," Jones adds.

 

She claims that ride-share app drivers perform "cash runs" on the Vegas Strip and that taxi drivers said there was "a huge problem with vehicles that are not even 'real' Uber and Lyft" drivers. "All a driver needs," Jones continued, "is a small U or Lyft sticker in their window and they can start transporting passengers for cash." So-called "gypsy cabs" are not a new phenomenon and it's hard to imagine confusing a ride arranged on a smartphone app and one arranged on the street for cash.

Jones also wants rideshare drivers to be "trained to deal with 'Strip road conditions'" and to let the Taxi Authority enforce rules she claims the Nevada Transportation Authority doesn't have the resources to. She also offers proposals for taxes, including that the state demand state-issued decals with "full permitting and registration with tax authorities," enforcing fines for "off-APP trips," and forcing "Uber and Lyft to keep drivers off platform unless taxes paid."

Jones further offered proposals under the guise of "consumer/labor protection" to constrict the use of ridesharing apps, including that all trips be hailed "a minimum of 10 minutes in advance" and no surge pricing as well as "no excessively low or predatory pricing permitted from the" ride-sharing service.

Jones complains that ride-share drivers don't go to residential areas and "will often only come to your house if he/she can surge price you for several times the normal fare," a total misunderstanding of how surge pricing works. "The free market will not solve this problem," she says, of a problem of lack of access to taxis in residential urban areas that services like Uber have helped solve in recent years by connecting would-be drivers to underserved residents.

"You and the Democratic Party are in a position to help my members this session," Jones closed, "and I respectfully request your help to support my member's full time jobs." The Independent notes taxi companies gave 50 state legislators $476,200 in the 2016 election cycle. Jones is doing what cartels all over do, looking to government to maintain crumbling monopolies. Taxi drivers and companies would be better off competing for customers and drivers than looking toward more of the kind of needless and constricting regulations even the union admits the state doesn't have resources to effectively enforce.


Pirate Taxis in NJ are posing as Uber cars to steal fares, lawsuit says

by Sean Riley


NJ.com

Hundreds of Uber drivers in South Jersey are suing the Atlantic City Yellow Cab Co., alleging taxi drivers have been fraudulently posing as drivers working for the rideshare service to steal their customers.

United Drivers South Jersey -- a rideshare drivers group that serves South Jersey, Atlantic City and Philadelphia areas -- filed a class-action lawsuit Tuesday in Atlantic County Superior Court on behalf of 240 Uber drivers, according to a statement issued by the group.

The Uber drivers allege that taxicab drivers in Atlantic City have been depriving "authorized Uber drivers of customers and fares that they otherwise would have received," said United Drivers South Jersey on its Facebook page.

The owner of Atlantic City Yellow Cab Co., Murray Rosenberg, called the lawsuit "outrageous," and flat out denied the allegations.

"There's no validity whatsoever," he said.

n a post last month, the United Drivers group said customers' trust was being broken by "lying, greedy cabdrivers trying to scam them and the whole Uber system in general."

The group has also posted videos that it claims shows taxicab drivers posing as Uber drivers and stealing their customers.

The lawsuit, according to United Drivers South Jersey, includes claims under the New Jersey's Racketeer Influenced and Corrupt Organizations Act, or RICO, which is a state law to combat racketeering in commerce.

The group also alleges that taxicab drivers are "putting riders at risk" because posing as Uber drivers invalidates their insurance.

Earlier this year, Gov. Christie signed a law to license and regulate ridesharing companies after years of that industry's own controversy and regulatory battles with the state.

"It is the hope of United Drivers that the taxicab companies will take immediate steps to stop this dangerous practice," United Drivers South Jersey said on its Facebook page.


NYC Taxi drivers rally over dropping medallion values - Down 70%

by Sean Riley


ABC

Some taxi drivers now suing New York City over the sinking value of their taxi medallions.

Drivers say services like Uber and Lyft have created unfair competition, and they blame the city for not creating a level playing field.

"Ask the credit unions at least to restructure some of the loans," cab driver Steve Howell said.

Howell started driving a checkered cab in the 1970s and is still working at 65. The drivers protested on the steps of City Hall Wednesday, asking Governor Andrew Cuomo for a bailout.

"Today I lose everything," drier Pardeep Sharma said. "They got my house. I don't know what I can do now."

The hard-fought medallions necessary for them to do business went for more than $1 million each just a few years ago, but they have now lost more than 70 percent of their value.

"Why isn't the city protecting our interests, that they sold to us for billions of dollars?" asked Carolyn Protz, of the Taxi Medallion Owner Driver Association.

The drivers' attorneys liken the situation to what happened in 2008, when homeowners lost out but the banks were bailed out.

"Many lenders are refusing to renew because of the uncertainty of the market," one driver said. "Even though the borrowers never have missed a payment."

At one point, Mayor Bill de Blasio came outside, saw the drivers and kept walking.

"When the smoke clears, another segment of the middle class will have been destroyed with the help of these fraudulent middle class defenders," driver Sergio Cabrera said. "Work hard. Play by the rules. So we can take your assets later."

They blame de Blasio and Mayor Michael Bloomberg before him for welcoming the new services like Uber.

"This was a great American story until two, three years ago," attorney Brad Gerstman said. "And now it is becoming one of the biggest immigrant crises in New York City."


Can’t regulate Uber, so Indianapolis commission looks to deregulate taxis

by Sean Riley


CBS

Red tape is to partly to blame for the rapid decline of Indianapolis’ taxi industry.

Or so say the taxi drivers.

State law doesn’t allow Indiana cities to regulate ride-sharing apps like Uber and Lyft.

A newly-formed city-county council taxi reform commission is looking into the regulations local taxi drivers currently face and if they can diminish the disparity.

“The taxicab companies have been treated unfairly because the Uber is not being regulated,” said Osman Djama, the airport taxi advisory committee chairman. “The taxis are being regulated.”

Right now, the city regulates everything from where taxi companies dispatch calls to where drivers wait for customers and even the colors of these cars.

They license drivers, testing them on names of major streets and the locations of hospitals and sports venues.

Complying with the rules and paying a list of fees costs drivers hundreds or even thousands of dollars a year. It’s money Uber,  Lyft and their drivers largely don’t pay.

The commission is looking at how much of that, in the age of ride-sharing, is still necessary.

Djama believes regulations put them so far behind, burying their companies with additional costs as they lost revenue. That doesn’t leave much money to keep up with apps in terms of convenience, even without a long list of regulations.

“They will struggle, but if the city developed apps, it would be the same as Uber and Lyft,” said Djama, referring to the idea of the city spearheading development of an app allowing users to request a cab.

But even then, taxis wouldn’t be the same as Uber and Lyft.

As the commission discussed, their business model is different.

The requirement that taxis look like taxis, for example, helps people who try to get in a cab that just happens to be waiting where they are.

Taxis also serve people who don’t have smartphones or credit cards, a requirement to use Uber or Lyft.

And there are somepeople who just prefer cabs.

Those people, commission members say, do still need protection.

They’re debating the line between protection and regulating the minutiae, like where taxis dispatch calls or how they keep records, which right now adds thousands of dollars in operating costs every year.

“The business is shrinking,” said Djama. “The companies cannot keep up with those [calls] dispatched as well as the expenses that they carry.”

Whether the changes will help them win back a generation that doesn’t think about taxis anymore, remains to be seen.