Tuesday, August 11, 2015

Seattle Taxi Will Never Be The Same

What had been long  rumored has been confirmed---sometime within the next few months, the BYG/Yellow taxi co-op will no longer exist in its current form, replaced by a system where lease-drivers will be renting/leasing taxi medallions on a 3-5 year commitment.  Precipitating factors fueling this monumental change in how Seattle's largest taxi association does business is due to the following antecedents reshaping and configuring our local industry.

Regulatory adjustments transforming "rented" licenses into real, negotiable property, along with the desire to be rid of  debilitating and prohibitive financial commitments monetarily draining the co-op convinced BYG that, like Uber, a more hands-off operational business model made for a more survivable future.  Since the City of Seattle and King County created an uncapped TNC/Ride-share market, it was logical that adjustments had to be made.  Removing the cost and headache of car replacement along with maintenance and repair makes numeric sense, eliminating onerous salaries and overhead. One unfortunate consequence is that some drivers might end up without a taxi to drive.  I am sure the more experienced drivers will survive. More than likely it will be the newcomers who are destined to fall due to this new evolutionary shift, adaption the underlying imperative.  Of course taxi is a "dog eat dog" "cat eat cat" world.  Always has been and always will be, continuing into taxi eternity.

But I must point out that if the initial  municipal response to Uber. Lyft and Sidecar had been less welcoming, it is doubtful this transformation at Yellow would have occurred, at least this quickly.  This is what happens when a regulated industry's pleas fell upon deaf bureaucratic ears.  I am guessing that some city council members are pleased with the outcome, feeling that we in the taxi industry have gotten just what we deserved.  All I can say to that attitude is that bias and nonfactual mythology should never provide the foundation for broad changes in governmental policy. Just because you don't like someone shouldn't immediately translate into punishment, which is exactly what happened here in Seattle and King County.  As I've stated here before, Mayor Murray and the current Seattle City Council members, with the exception of Mike O'Brien, don't like us.  That fact is inescapable. And their recrimination has become our operational reality.  And what can we do about it?  That is a "good question" is my comment.

One Down, Four to Go

Last week's Seattle primary knocked three-term Council-member Jean Godden out of the race, Godden placing third.  As someone who once voted for her, I wish her well yet at the same time I remain unhappy she voted to uncap the TNC industry in Seattle.  Looking at the primary votes, it is unrealistic to think that the four remaining taxi offenders, Burgess, Bagwell, Harrell and Sawant will all lose out in November though Sawant in particular appears to be vulnerable.  I suggest it might be wise to actively support their opponents in the general election while asking for their support for our industry.  We require friends on the City Council, not vindictive enemies.

You Can Bet I Would Have

While driving an extra board cab last Wednesday afternoon, I was hit by a driver who ran a red light.  Minor damage and no injuries but if I had been hurt I would have filed my L&I claim with the State of Washington. One part of BYG's reorganization is that the L&I "over-payment" issue will be rendered moot.   L&I did send me an email.  When I have the time, I will tell you the substance of their reply but suffice to say, none of what is happening is their fault.  I think it is called, "passing the governmental buck" or something like that. The best part of the accident is that my passenger wasn't hurt.  Thankfully my quick foot translated into the front bumper taking the full impact.  Thank goodness for something!

File this into the "You Gotta Be Kiddin'" category!

No matter how long a cabbie has been driving, you will experience something new and different and usually, unwanted.  My last fare this weekend was this very silly woman who kept saying "how good she was looking tonight" and somehow, someway expecting me to respond favorably in a manner I don't want to even contemplate.  Talking over the loud rap music playing from her smart phone, she kept soliciting my attention.  The one thing I did say, as a joke, to her narcissistic self-commentary, was that "It was good that at least one person agreed with her."  meaning of course, her.  Leaving the taxi, she said, "I had been mean to her." for not taking her up on what she was offering.  Hey, she can keep it, thank you very much!  Good grief, Charlie Brown!

Another Example of Unexpected Consequences

The truth is, and it is the truth, is that the folks regulating the Seattle and King County taxi industry have been asleep at the regulatory wheel for a long time.  During the last TAG meeting, the current KC Department of Licensing director said to me that yes, he believes that fingerprints naturally alter yearly, when responding to my question as to "Why are the being drivers forced to have all ten fingers fingerprinted annually?"  He said that proof backing his assertion existed but I have yet to see it.  When I asked him whether he or anyone else at King County were required to have annual fingerprinting, he said, no, that it isn't required. I bring this up only to illustrate the kind of attitude and awareness prevalent with current administrators, having no idea concerning the world their policies create.  Too often the drivers who are licensed to drive taxis, flat-rate for-hire, and now Uber, are clueless to the environment they have entered.  For me, an incident Sunday night at Pier 69 (the Victoria Clipper) says it all, screaming it into the night.

Dispatch was slow in announcing that the "boat was in," leaving only me and the taxi supt in attendance.  A driver pulls up but acts confused because the door leading to US Customs remained closed. As he started to drive away, the Supt shouted "Where are you going?" and I told him, "The boat is here and the door is about to open." and as I was saying that, a Clipper employee unlocked and propped open the door.  Joking I told the driver, "But hey, if you want leave, go!" which prompted him  to take off.

As he was leaving the pier, a bunch of cabs came roaring up, thus signalling to him that indeed he needed to turn around.  Coming back around, he jumped out of his cab, yelling at me, telling his friends that I had told him to leave.  Huh? was the general response, because I am just another driver and anyway, I was just trying to get his attention.  What is troubling about this was his "in general" bewilderment, the gentleman seemingly incapable of interpreting a fairly straight-forward situation.  As I have said, and keep saying, this is what happens when perfectly nice people are put in a situation they are totally unprepared for.  But you can be sure that next year they will again take down his fingerprints, enabling to do what I have no idea.  Amazing, amazing, and I repeat, amazing!  And I'll say it again, "Good Grief!"


  1. Joe, once again, you are telling only part of the story.

    If Seattle was a singular example in terms of the changes that are happening in the taxi industry, then maybe your argument might have some merit, but these changes are occurring in almost every major metropolitan area in the country and, in some respects, internationally as well.

    In other words, taxi service was, in essence, a closed industry.

    Almost everything about it was artificially contrived.

    From the number of cabs allowed on the road to the number of companies that were allowed to operate within a government declared parameter and this formula did create abuses within the system.

    It did effect the overall quality of service.

    It was never a question of whether cabs were liked or not liked.

    It has far more to do with whether the network they designed was up to the task of delivering the kind of service a city needs.

    The question then revolves around what exactly is a cab and whether this means of transportation is part of a "public service" network and, if it is a critical component of a "public service network", then should it become direct part of the governmental framework in terms of providing transportation or not?

    In other words, is the type of regulation that was originally imposed on this industry the right kind of regulation?

    So let's use another industry as a comparison point, the airline industry.

    Undoubtedly, airlines are a critical component of our overall transportation network, BUT, unlike the taxi industry, while heavily regulated, it is not controlled in terms of the number of companies that can operate at an airport.

    Thus, for example, Delta now wants to expand its operations in and out of Seatac and create an international hub for flights in and out of Asia, but, this expansion will put it at odds with Alaska Airlines (the dominant airline at Seatac) because they will now have to compete head to head with Delta in terms of national flights going to and from the airport.

    In other words, more planes will be flying in and out of Seatac by Delta to support its new international hub and there will be greater competition between Delta and Alaska.

    Now, using this as an example, would you want the governmental components to prevent this kind of expansion of service just because it potentially hurts a local company?

    Now, if we base your arguments on just what is liked or disliked in terms of service, then no one loves the services of the commercial airline industry. From the lack of room in economy seats, to additional costs for virtually everything, to how luggage is handled, there are universal complaints across the board.

    So arguments like these are not just based on liking or disliking a company.

    To be continued......

  2. Instead, the argument is based on a different kind of logistic.

    Since Delta wants to expand its services at Seatac, the argument then becomes who pays for the expansion.

    Since Alaska Airlines has a very limited international presence, it does not want to pay for the expansion of international service, while Delta is making a different argument.

    There is another way to look at it; more than 35 years ago, there was Pan Am, TWA and Eastern and for decades these three companies dominated the airline industry. Where are they now? Instead, newcomers have come in their place; Southwest, Jet Blue, Virgin Atlantic and so on. Airlines also created partnerships with airlines that fly into cities they do not fly into, modernized their reservation systems and did a host of other improvements, but if you ask most people who do not fly business or first class, the service still sucks!

    Thus, would you want limits to be put on Delta in terms of service expansion in order to protect Alaska Airlines business coming in and out of Seatac?

    Now, what does this have to do with the Taxi Industry?

    For decades, the taxi transportation network within each locality was dominated by a select group of companies and expansion of service was limited because of the relationship between these companies and artificial nature of the market they were operating in.

    Because there were limits put on expansion and/or even in terms of how a vehicle can operate (this company is designated for street hails and so on), well, let's just say that the previous operational model was not up to the task of delivering quality service.

    Then along comes Uber, Lyft and Sidecar.

    Now, the question evolves to a different kind of premise.

    Since the taxi industry was a closed and artificially contrived entity within each locality, how could new companies enter into the market?

    Your argument revolves around not allowing new entrants and to maintain the status quo, but a politician will ask a different question, should they allow for an expansion of service and what shape should that expansion take?

    Let’s use NYC as an example.

    Because of the artificially contrived nature of their market, the value of a medallion skyrocketed and only a select group of companies ended up owning the fleet. When the fleet was expanded, its numbers were ruled not by need across the city, but by the number of medallions that was put up for auction in order to grow the value of that medallion. These costs were spread down to those who leased, but, in many respects, the task of serving the NYC market in terms of demand always came up short.

    Now, ask yourself a question, if Uber, Lyft and Sidecar just played by the rules and applied for the right to operate within the City of Seattle, would it have been approved to operate?

    In all likelihood, the answer would be NO!

    The question then becomes WHY?

    As in WHY should they be not allowed to enter into the City of Seattle’s market?

    Now, there is no question that the mechanics of how they became legal is questionable.

    After all, they were given a green light to build their market share under the “legal” radar, which did hurt everyone’s bottom line across the board and yes, there are legal dimensions to this argument in terms of compensation for your losses since they did build their market share in an illegal state.

    In this respect, anyone who has been subjected to losses can sue these services and yes, these includes the For Hire vehicles, BUT, the question remains; should they be blocked from operating within the City of Seattle and what are your reasons for blocking them?

    This is why the airline industry is an apt comparison. It too is an important component of a transportation network, BUT, some kind of competitive marketplace is in place, even though it is a heavily regulated industry.

    To be continued......

  3. And the one question you have failed to answer throughout your entire argument is WHY should Uber, Lyft and Sidecar (or whoever else comes along) be denied entry!

    Again, there are differences between how they were allowed to enter the market versus whether they should be allowed to enter the market at all and all your arguments are always based on a complete denial of that entry in order to preserve the status quo, BUT, what if the status quo did not meet the needs and increasing demands of a city?

    In effect, you are arguing that things should remain the same, even if that means that improvements in terms of dispatch technology are sacrificed in order to preserve the status quo.

    Next, why did Uber, Lyft and Sidecar achieve their market share, regardless of whether they were in a “legal” state or not?

    Let’s take just one clear improvement they have made relative to the lack of improvement made at, for example, Yellow Cab, their dispatch system. For example, Uber, Lyft’s and Sidecar’s system is linked to Google Maps. It not only measures approximate time and distance for each trip, it also authenticates the address.

    Now compare this to Yellow’s system and ask yourself how many times each day you are dispatched to a non-existent address and what it just cost you to go to that non-existent address in terms of time and money.

    This is but one example. There is also the shape of the vehicles, the pricing and a host of other reasons why they keep on increasing their market share.

    After all, they did not grow this in a vacuum or because hipsters like playing with their cell phone.

    Even their transactional methodology functions better than a company like Yellow’s.

    You can take issue with their business model, which is, after all, extremely predatory towards both the existing companies within each locality and those who provide the service to their customers, but not with the service they are generally providing.

    You can say that they play by their own rules and are litigation crazy because of how they enter a market.

    You can say that they have built such a large supply chain that it has detrimentally affected the ability of those who work in the industry to make a living, but the remedies to these problems have nothing to do with whether they should have been prevented from entering the market.

    By all means, sue them for the losses during the time they were operating illegally, but preventing them entirely; WHY?

    To be continued......

  4. Yes, Yellow Cab is migrating to a similar business model in terms of passing the costs of operation onto you (while charging you a pretty hefty fee for that migration), but they are not providing you or any of their drivers with a better business model so you can effectively compete against the improvements Uber, Lyft and Sidecar made to the overall service!

    Thus, by accepting their new terms, you insure Yellow’s survival, while not questioning WHY you are accepting these terms and, once again, you are blaming a governmental entity for a business decision Yellow has made in terms of changing the parameters of their relationship between the public and those who are providing the service.

    Even worse and in light of the lack of improvement, your costs are going up, while they insure their profit margin and for the life of me, how you can blame this on the City of Seattle?

    It makes no sense Joe!

    While true that Uber, Lyft and Sidecar did effect your bottom line, as well as the City of Seattle in terms of allowing them to compete in an illegal state, well, now that they are legal, YELLOW IS STILL LOSING MARKET SHARE AND THEIR ANSWER HAS FAR MORE TO DO WITH THEIR OWN SURVIVAL THAN IT DOES WITH YOURS!

    And if you do not answer the question of WHY they lost market share and/or why anyone would want to assume more costs in order to drive a cab (while their market share keeps on sinking), THEN NOT A SINGLE PERSON SHOULD BE SIGNING CONTRACTS LIKE THIS WITHOUT SOME CONCESSIONS TO THE REALITY OF WHAT HAPPENED AT YELLOW CAB!

    Even worse, while blaming the City of Seattle for Yellow’s current predicament (while ignoring Yellow’s own foibles which lead to this decision – after all, is this not the reason why they went behind everyone’s back in order to make a deal with the city to convert their licenses into medallions – how soon we forget the role Yellow played in this part of the negotiations to make the TNCs legal), you choose to ignore other battles that could have been won, such as challenging our current classification of “independent contractor”!

    Hell, I wonder if you even heard the latest rumor in terms of the airport Joe, because even here, they are trying to undermine those single owners who paid thousands to Yellow to be a part of providing airport service, including those who joined up with Yellow to be a part of that contract. Now, according to the rumor mill, Yellow is pushing to open up the airport, at the expense of those who invested thousands to be a part of that original contract.

    Imagine how that will play out.

    But remember, the city is responsible for everything.

    If only that was true!

  5. That is unfortunate that the rumor about 'the BYG/Yellow taxi co-op will no longer exist in its current form' and will be replaced with a new system. I am pretty sure that we are all just hoping that this will all work out for the better. That way everyone can still get the taxi services that they need when the time comes. People have been getting this type of taxi services for years now and it might take some time to get use to.

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