Sunday, February 18, 2018

I Want To Know Why Seattle's Department of Licensing Believes The Local Taxi Industry Requires 55 Additional Taxis

Within the next few weeks the City of Seattle will once again hold a medallion lottery for fifty-five City-only plates we do not need.  As I have mentioned in the past, when taxis were the only transportation option in Seattle and King County, did the Department of Licensing authorize more licenses when we truly needed them?  No, despite our constant urging  and nagging (and begging), the City of Seattle remained unmoved by our pleadings.  No, they they repeatedly said, we are not going to do it.

Finally, after much lobbying, the Seattle City Council expanded the number of potential licenses by, if I remember, two-three hundred but still that didn't mean they were released.  No, what happened instead was they waited until our market was saturated by 14-18 thousand Uber and Lyft operators, plus an additional 2-3 thousand other assorted quasi-taxis to begin adding to the local taxi fleet.  Why they did this, and continue along this track is anyone's guess.

Logic says this doesn't make any sense but after observing Seattle and King County taxi regulators over the past 30 years its clear logic is not their guiding beacon.  But just what is their primary motivation for doing what they do remains mysterious unless it is a kind of sadism because currently the majority of the taxi drivers are sitting in place doing nothing whatsoever save going crazy. As I keep repeating, we are not having any fun.

In a response to my email, John Megow, Regulatory Compliance and Consumer Protection Manager for Seattle's Department of Licensing said all they were doing was implementing a 2014 authorization releasing 200 medallions, and besides, he told me, he had feedback from many drivers eagerly awaiting their opportunity to become a taxicab owner.  In other words, the malnourished are starving and Seattle will mimic the Old Testament gods and provide licensing manna from taxi bureaucratic heavens.

While what Mr. Megow said is true, it doesn't mean that the decision shouldn't be revisited because our business model is broken and when will it ever be mended and repaired?  The sorry answer is never, never will the taxi business in Seattle and the United States in general return to its previous profitability.  In Europe, and in cities like Reykjavik and Paris, their taxi industry is striving but in the good old USA the reverse is true.  So why add more misery to an already horrible situation, 55 new cabs meaning one thing only, that being a further dilution of a meager market, making it even harder for everyone to make a living.

Certainly statistically there's no justification for medallion expansion, as our local industry profitability three years ago was reduced by over 30 percent, and now I am guessing it is now down to 50 % or less.  Last week a New York City livery cabbie killed himself in front of New York's  City Hall but not before he had written an eloquent suicide note explaining he had been working 100 hours a week to make what once took 40 hours to earn.

This is our situation here and elsewhere nationwide.  All of us our working harder for less money.  And believe me, we are not enjoying ourselves.  Taxi driving has become a living hell.  In a response to John Megow I used one word to describe my experience as a lottery medallion winner: brutal--- meaning I am not having any fun working myself to down to the taxi bone.

The irony concerning ownership is that while business sucks our overhead remains high, the only recent relief coming with a reduction in insurance rates but collision coverage remains prohibitive, so if you have an accident more than likely it means the cab owner will be solely responsible for all related replacement costs.  If you own a Prius that could mean somehow you are going to have to suddenly come up with 14-20 thousand dollars.  Most owners do not have that kind of money in savings so it all translates into further debt.  It is not a pretty picture.

If you win a medallion, this is what you are facing in terms of initial costs.  If you buy, like I did a 2011 Ford Crown Victoria you are going to pay anywhere from 2-6 thousand dollars for the car.  A Prius will cost you anywhere from 14-20 thousand or more.  Painting the car is $500-1000.00.  Initial upfront insurance costs are about $1500.00.  Meter and computer will set you back $500.00.  The annual City of Seattle medallion fee is about $600.00.  Your business license is $110.00  I think the State of Washington business license is another $100.00.  After all this you soon will find that your car now needs tires and brakes and a new battery, translating into yet another $1000.00.

I promise you this is not an exaggeration.  This is my reality, and unless the City of Seattle relents, 55 more innocent taxi souls will be thrown into the fray.  And do I need to remind everyone that it was none other than Seattle and King County who created all this by tossing out their 250 car Uber cap and allowing Uber and others to expand and take over our market?

Is this some kind of cruel joke?  Yes it is, and of course none of us cabbies are in a good mood.  As I pointed out last week, it appears my friend Ali literally worked himself to death.  No, none of this is funny.  When the City of Seattle goes ahead regardless of my warning that it is a fatal idea, let me be clear, there will be no humor in Seattle Cab-land, mirth being our last emotion concerning the subject.

Postscript 02/17/2018

There is an ongoing local myth that the reason we have no business is because we don't have enough cabs to serve the business as opposed to my contention we have too many taxis at the moment and certainly don't need anymore, making a bad situation worse.  What this argument misses is that if we had customers calling none of us would be sitting hours at a time going completely out of our minds.

And as I have said, the costs associated with taxi ownership is high which means the new owners will be forced to work long hours just to cover their overhead in additional to bringing the bread home to the family table.  If anyone thinks working seven days a week while averaging 12-15 hours a days is okay then you are insane because it isn't anything anyone should be doing.  To make a rhyme out of it, you have no life and will never see your kids nor the wife.

So my suggestion is to embrace reality over mythology, recognizing that we as an industry are in deep trouble, a trouble threatening our very existence.  A recent study revealed the amazing fact that even during Uber's "surge" periods, when Uber sometimes charges up to four times or more than standard taxi rates, 6 out of 10 Uber customers still decide to ride with Uber though it is now costing them "a pretty penny!"

Scary, which is why the City of Seattle should cancel the upcoming medallion lottery.  Unless of course you believe in fairy tales like so many of my fellow drivers, that somehow God and the City of Seattle are watching over them, blessing their every move.  Ha Ha Ha! is all I can say to that!  But of course I am not laughing, delirium my current state of mind.











2 comments:

  1. Joey ,
    As you know , this is yet another
    nail in the taxi coffin !! I often wonder , how soon before
    you have drivers ' living ' in
    their cabs ?? Really , I'm
    serious !! As in the early
    '80's with the Reagan Recession
    and a few short years after
    the taxi deregulation of '79,
    how some drivers whom couldn't
    afford to rent an apartment,
    ( which was by todays standard
    very cheap $ 175 - $ 200 ),
    slept in their cabs , ate
    fast food , and shaved / washed
    in hotel restrooms. So my
    query to the city / county
    would be , hey pal , you've
    already bankrupted the
    taxi industry into being
    like a member of a third
    world , all the while
    earning your HUGE governmental
    paycheck , so how soon before
    the drivers start dying en
    masse ?? Think about it.
    Bill

    ReplyDelete
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