New York City on Wednesday froze new licenses for VTCs and imposed a minimum wage for drivers, two unprecedented measures in the United States which constitute a snub for Uber and its competitors.
This suspension of new permits granted to cars with driver (VTC) aims to give the New York authority for the supervision of vehicles with driver (TLC) time to carry out an impact study to measure the effects of this industry on the city.
As for the minimum wage, according to the text adopted on Wednesday, it will be up to the TLC to determine the amount, but a report that the authority has ordered and validated recommends an hourly wage of 17.22 dollars.
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It corresponds to the minimum wage that will be in effect at the end of 2018 in New York State, i.e. $ 15, increased by an amount considered necessary to cover the costs of drivers. According to the report commissioned by TLC, 85% of VTC drivers earn less than this hourly wage.
Setting a minimum net hourly income of $ 17.22 would result in an average increase of 22.5% for VTC drivers, according to the study.
A double setback
Regarding the repercussions for users of creating a minimum wage, the document estimates that the cost of a ride could increase, on average, by 3 to 5% and the waiting time from only 12 to 15 seconds.
This is a double setback for the big players in VTC, Uber in the first place, but also Lyft, Juno and Via, who have campaigned for weeks to mobilize users on the subject.
For Uber, this one-year break “threatens one of the few transport solutions (in New York) without doing anything to improve the subway or decongest traffic,” according to a statement.
“Don’t let New Yorkers down,” said an advertising spot for the famous platform, suggesting that unlike its drivers, traditional taxis sometimes refused to take clients from ethnic minorities, especially blacks.
“Soon, higher prices and more waiting,” Uber announced in a message sent to its users, inviting them to contact their local elected officials to oppose the text. In 2015, New York Mayor Bill de Blasio had already tried, in vain, to limit the number of VTCs.
A “congestion pricing” under study
“More than 100,000 workers will see the immediate benefit of this law,” the mayor responded in a press release. “And this decision will stop the influx of cars which contributes to the congestion that paralyzes our streets.”
In 2010, before the installation of Uber the following year, the city had about 37,000 VTC and some 13,500 taxis.
Last year, the number of taxis, fixed by the TLC, had not changed, but the VTC, them had more than doubled, passing to more than 83,000.
South Manhattan is now plagued by traffic at an unprecedented density and uninterrupted from morning to night. The situation led Governor Andrew Cuomo to discuss the creation of a tax (congestion pricing) that vehicles traveling in the most congested areas should pay.
A proposal supported by Uber, but to which Bill de Blasio said he was rather opposed. In addition, the explosion of the market for VTC has put taxis under pressure and plunged the value of their license or medallion, which was negotiated, a few years ago, beyond the million dollars.
Six suicides
In less than a year, six taxi drivers ended their lives by clearly suggesting that their gesture was linked to their profession.
“It is not easy to attack the giants of Silicon Valley, but we continued to fight for what we knew to be fair and today the workers have won”, responded the Independent Drivers. Guild, a union that appeared in 2016 to represent VTC drivers.
Several cities and countries have taken action against Uber, including London, which withdrew its license before returning it to it.
In early June, Turkish President Recep Tayyip Erdogan announced that Uber was “finished” in Turkey, after a campaign of protests from Istanbul taxis.
Uber was also banned in Bulgaria and pulled out of Denmark and Hungary after a law was passed making it impossible to operate
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