On August 8, the New York City Council decided toNew York City Council has decided to the on-demand chauffeured transport industry, dominated by Uber and Lyft. New legislation, which mayor Bill de Blasio soon ratify, has a dual objective: to reduce the traffic jams that increasingly paralyze the city, and to guarantee a minimum income for drivers. Concretely, it freezes for one year the issuance of licenses to new drivers and establishes a minimum wage for existing drivers.
Hailed by the drivers, this decision is strongly criticized by the platforms, which have mobilized for several weeks, in vain, their users against legislation that will stop the growth – until now vertical and uninterrupted – of one of their bigger markets. Beyond the halt, several questions arise.
The quest for virtuous integration
Was such a decision avoidable? Not really: the status quo, marked by conflicting interests between the public and the private sector, was not tenable. Will this new legislation make traffic easier? We can debate it at length. More interesting: what will be its impact on the future growth of on-demand transport?
Paradoxically, this decision can, under certain conditions, give on-demand transport with a driver, and more broadly to all the new mobility services, the second chance they need after a first period of recklessness. If the city and the platforms give themselves the means to do so, this decision could indeed mark the beginnings of a virtuous integration of new forms of mobility into the city’s multimodal transport offer.
Regulate and understand
The activism of New York and its choice of an approach by experimentation are a first condition in the achievement of this objective. Unlike many cities which either watched, without intervening, private actors disrupt traditional modes, or prohibited any form of innovation to protect their historic systems, New York initially put itself in the position of regulate (via a licensing system) and understand (by imposing data sharing) without slowing down, until today, the development of a new service popular with city dwellers.
Now that this service has reached a critical mass, this break will allow the city to better understand its advantages and disadvantages. This approach echoes the policies pursued by Singapore, London or Dubai, quasi “city states” in terms of mobility and often cited as examples to follow.
To allow the revival of new forms of mobility, there are nevertheless other conditions to be fulfilled.
A fragmented governance
First, any decision impacting on-demand mobility should be taken as part of an overall reflection integrating all modes of transport. However, in New York, as in Ile-de-France, the governance of mobility services and transport infrastructure remains fragmented. To succeed in orchestrating their mobility, cities must have the corresponding decision-making means and financial means.
Second, New York must move from a model favoring a posteriori regulation to win-win partnerships with private actors. Partnerships aimed at establishing complementarity between Uber or Lyft and public transport already exist in some thirty cities in the United States, but here on a large scale.
Thirdly, New York must equip itself with new measurement tools, allowing to really understand the advantages and disadvantages of different services and to overcome flashy but irrelevant figures, such as the number of vehicles.
Everyone’s eyes are now on New York, and we expect a lot from it: if the city and the platforms cooperate intelligently, this year of observation can be an opportunity to learn how to turn a technological utopia into a powerful one. public policy tool – from which Paris could draw inspiration.
Joel Hazan is associate director of the Boston Consulting Group in Paris; Pierre-Francois Marteau is a consultant at BCG in New York.
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