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Chicago taxi industry sliding towards collapse

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Re: Chicago taxi industry sliding towards collapse

#151

Post by kevindong »

The Uber/Lyft systems are very robust (in the sense that I have no trouble getting drivers to take my ride requests at any time) in Chicago. That being said, I cannot imagine the drivers are making a decent living driving.

Anecdotally: as long as I don't go during rush hour (i.e. 7-9am or 4-6pm on weekdays), I can get from anywhere in the densely populated sections of Chicago (basically, anywhere within 5 miles of the loop) to another section for ~$3~5 via Uber Pool/Lyft Line. At that price point, it's competitive with taking public transit.

I'm interning in Chicago this summer and I've already taken pool/line 10 times, each for ~$3~4 and taking ~20 minutes and going about ~3 miles. Uber/Lyft's algorithms for matching riders up is actually pretty good in my experience, but even then let's assume that each driver has two riders per trip, each paying $4 and each trip taking 20 minutes. In which case, they'd have 6 riders per hour for a total revenue of $24/hour before Uber/Lyft's cut and accounting for their own expenses. I refuse to believe they can actually make a living by driving this way.

Re: Chicago taxi industry sliding towards collapse

#152

Post by cmurf »

basseq wrote: post #3

I'm left wondering... so what? The "personal transportation" market has massively changed. Whether it's for the better or worse simply doesn't matter . Veteran Chicago cabbie John Aikins,67, who is facing foreclosure on two medallions for which he owes more than $330,0000, said he has little hope that the industry can be saved. "It feels like the city is just watching us collapse," Aikins said. "Right now, there are…

Chicago owes a fair and equal competing market and what they've done is permit two totally different regulatory paradigms to exist at the same time: conventional taxes, and new taxies, sometimes also called ride sharing which is obviously bullshit to get around being called a taxi and regulated as a taxi.

Uber and Lyft rides are also investor subsidized, and that is likewise market distorting.

The city of Chicago, like many other cities, simply doesn't know what to do. They lacked the knowledge and/or the courage to either regulate Uber and Lyft etc just like taxis; or end the taxi monopoly and take some role with handling the total collapse of the medallion market (partial buy back perhaps).

But any of these meallion owners should investigate a hair cut negotiation with their lenders or talk to a bankruptcy attorney. There is no good reason for these people to be in debt on a useless asset. It's every bit as much their mistake to loan, as it was the lenders mistake to lend.

Re: Chicago taxi industry sliding towards collapse

#153

Post by spydum »

agotterer wrote: post #137
nserrino wrote: post #25

I probably won't ever take a taxi again, but have some sympathy for the cab drivers who put their life savings in medallions. The city effectively promised them the exclusive right to give taxi rides, but didn't do anything about a non-medallion entity doing that same thing. They put hundreds of thousands of dollars into something meaningless.

Its hard to even consider taking a taxi at this point. I was in Chicago last weekend and considered taking a taxi from the airport into the city. Taxi wanted ~$60 and Uber wanted ~$25. The same thing happened in SF a few months back. The driver wanted $90 to goto Palo Alto and I took an Uber pool for $23. Granted I don't believe for a second that's the actual rate and I'm confident the driver was trying to take advan…

It's worse than just pricing.. I've had several taxis "pretend" their meter stopped working, to try to scam a cash ride.

Re: Chicago taxi industry sliding towards collapse

#154

Post by djohnston »

I'm a big fan of ride sharing and I share your frustration with taxis, but I do think they have a point here.

The judge says: "Were the old deemed to have a constitutional right to preclude the entry of the new into the markets of the old..."

If you're willing to admit that it's the same market, the taxes and fees from the city should be lifted. It's absolutely unfair otherwise.

Re: Chicago taxi industry sliding towards collapse

#155

Post by [deleted] »

bitJericho wrote: post #64
TulliusCicero wrote: post #47

Earlier quoted context omitted.

Yeah, and I bet after Borders shuts down, you'll see Amazon raise book prices sky-high! People always claim this will happen, and it never seems to. If Uber tripled prices, a competitor would start up to cut into their market share.

VCs wont pay for rides forever.

[deleted]

Re: Chicago taxi industry sliding towards collapse

#156

Post by emmelaich »

weberc2 wrote: post #76
alkonaut wrote: post #65

Earlier quoted context omitted.

> As a monopoly, you usually have no reason to change. But they don't have a monopoly and haven't for several years. I mean changing from phone dispatch to apps has to be done in 6-12 months not 6-12 years otherwise yes they will go under. So what you are saying is that they are too slow to change? What's the reason for that? Is it that the taxi operators are small businesses and they are a too diverse group to be wi…

> I mean changing from phone dispatch to apps has to be done in 6-12 months not 6-12 years otherwise yes they will go under. I think you underestimate the amount of work involved in building a rideshare platform. How are taxi companies going to consolidate and find app developers to build a platform to compete with Lyft and Uber in a tiny fraction of the time, not to mention getting the word out about their platform,…

A couple of apps for taxis have appeared in Sydney in less than a year after Uber arrived.

Re: Chicago taxi industry sliding towards collapse

#157

Post by JumpCrisscross »

gehwartzen wrote: post #143
basseq wrote: post #3

I'm left wondering... so what? The "personal transportation" market has massively changed. Whether it's for the better or worse simply doesn't matter . Veteran Chicago cabbie John Aikins,67, who is facing foreclosure on two medallions for which he owes more than $330,0000, said he has little hope that the industry can be saved. "It feels like the city is just watching us collapse," Aikins said. "Right now, there are…

How did Uber get around not having to buy medallions for their drivers? What prevented someone from operating a for profit ride program even before Uber without a medallion?

> What prevented someone from operating a for profit ride program even before Uber without a medallion?

Uber scaled fast while ignoring local regulations. Both parts are important. We've seen from e.g. Zenefits [1] that state regulators are powerful. Local regulators, on the other hand, are slower moving.

Previously, a disruptor might assemble a few happy customers before the regulators slammed down on them. Uber's ability and willingness to scale fast changed that. By the time the local regulators were ready to slam down, entire cities of constituents wanted and liked the service. That changed the political calculus. Uber, and consumers, won.

[1] https://venturebeat.com/2017/04/11/zenefits-fined-1-2-millio...

Re: Chicago taxi industry sliding towards collapse

#158

Post by sanswork »

gehwartzen wrote: post #143
basseq wrote: post #3

I'm left wondering... so what? The "personal transportation" market has massively changed. Whether it's for the better or worse simply doesn't matter . Veteran Chicago cabbie John Aikins,67, who is facing foreclosure on two medallions for which he owes more than $330,0000, said he has little hope that the industry can be saved. "It feels like the city is just watching us collapse," Aikins said. "Right now, there are…

How did Uber get around not having to buy medallions for their drivers? What prevented someone from operating a for profit ride program even before Uber without a medallion?

Taxis are generally allowed to pick up anyone anywhere. Most cities also have a category for car services which are only allowed to pickup pre-booked rides. The licensing for these is generally a lot cheaper and not limited in anyway.

>What prevented someone from operating a for profit ride program even before Uber without a medallion?

Nothing and lots of companies do it.

Re: Chicago taxi industry sliding towards collapse

#159

Post by [deleted] »

orcdork wrote: post #103
thephyber wrote: post #85

Earlier quoted context omitted.

> have some sympathy for the cab drivers who put their life savings in medallions Nope. Nope nope nope nope nope. They were speculators in a bubble market. It didn't matter what percentage of their life savings they used. If you feel sorry for someone who purchased a $300k taxi medallion which had an intrinsic value (the total value a medallion can be used for rental to taxi drivers over X years) which is far less, y…

Can't help but wonder, would you call startup investors "pieces of trash" in the event of a bubble popping? What if they asked the government for assistance, would they be actual pieces of trash then? What if it was the web devs requesting assistance, due to thousands being laid off when said bubble popped - would they be actual people made of refuse then? You don't sound the least bit saddened, quite the opposite.

[deleted]

Re: Chicago taxi industry sliding towards collapse

#160

Post by sanswork »

clock_tower wrote: post #147
gehwartzen wrote: post #143

Earlier quoted context omitted.

How did Uber get around not having to buy medallions for their drivers? What prevented someone from operating a for profit ride program even before Uber without a medallion?

Uber broke the taxi laws and dared regulators to stop them -- and they mostly won that dare. (Remember all that talk about disruption?)

Uber generally didn't break taxi laws since most cities only give medallion owners monopoly over unbooked pickups.

Uber generally broke car service laws by not requiring their drivers to have the local registrations.

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