The free ride is over for Uber and Lyft in New York.
The city will impose the harshest set of regulations on app-based for-hire vehicles on the planet, Mayor de Blasio announced Wednesday.
Hizzoner said the city will extend the cap banning the city from issuing new licenses to for-hire vehicles — there are currently some 85,000 cars working for Uber, Lyft and their app-ride competitors.
Wheelchair-accessible vehicles and fully electric cars will be exempt from the rule.
“For too long, app companies have taken advantage of hardworking drivers, choking our streets with congestion and driving workers into poverty,” said Mayor de Blasio. “That era will come to an end in New York City."
New regulations will also crack down on the amount of time app-based drivers roll around the busiest parts of the city without a passenger in tow.
Come August 2020, Uber, Lyft and their competitors must set up a system that forces drivers to be carrying a passenger at least 69% of the time while operating in Manhattan below 96th St. If a car spends more than 31% of its time below 96th St. without a passenger, its company will be subject to penalties.
City estimates show more than 40% of the for-hire vehicles rolling in that area currently drive without a fare, and the technology within the apps allows the city to crack down on cars that are cruising around, waiting to catch customers.
The city’s new minimum wage laws for app-based drivers require they be paid based on how often they have a passenger. The new regulations will update the current city rules and allow individual companies to establish their own “utilization rates." The city currently has one in place industry wide.
City officials expect these regulations will cut the amount of hours cars spend in Manhattan below 61st St. by at least 20%. It is also expected that the speed of traffic in that zone will increase by up to 10% — traffic is currently crawling along at an average of 7 mph during the day.
“I think the regulations are very strict considering that we are not allowing them to grow the industry,” said Deputy Mayor of Operations Laura Anglin, who noted that the city is likely Uber’s largest market. “We wanted to do it (the cap) in 2015. By the time people realized the exponential growth of the industry, we were seeing them (Uber and Lyft) put 2,000 vehicles on the road a month.”
Transportation consultant Bruce Schaller, who published a landmark report last July detailing the impact of app-based ride-hailing companies on city streets, said the regulations were “really important," but thought the city could reduce congestion without a vehicle cap.
"The risk is that you create another medallion system on the for-hire side with all the unintended consequences that it had with the yellow cabs,” said Schaller. “I’ve been hearing that drivers are renting out their car for a second shift. Once you create an income flow for people who have a vehicle license, you’ve just created a new medallion system.”
Anglin disagreed with that criticism, noting that the Taxi and Limousine Commission now regulates driver expenses as a part of the city’s minimum wage rules. If the cost of car leases skyrocket, Anglin says the minimum wage will as well.
“Right now there’s too many vehicles on the road,” said Anglin. “So why flood the market with more? We will continue to evaluate the cap.”