Taxi owners, drivers, lawmakers debate how to compete with Uber

ROCKVILLE, Md. — With Uber and Lyft already taking a large amount of customers away from Montgomery County cab companies, both lawmakers and taxi owners are catching up to offer services to help the industry survive.

A public hearing between owners, drivers and lawmakers on Tuesday was a lot less contentious than one late last month.  The three parties agreed there needs to be a regionwide taxicab app.  Uber and Lyft customers can get a car in Fairfax, Arlington, D.C., Rockville or Largo with one app.

“We need to figure out an app with the consumer in mind.  If we look at it through the lens of the customer, then we can’t go wrong,” says Montgomery County Councilmember Roger Berliner.

He says there needs to be one app.  Customers won’t download separate apps for separate counties.

Cab driver Bruce Block agrees that the industry cannot survive without an app.  He has been driving for Barwood Taxi for almost four years.

“It’s important for the millennials.  When they’re out in Montgomery County late at night, they can pull up their phone, as they do with Uber, hit one app and be able to get a cab.  No matter what company it is from,” says Block.

But Barwood Taxi owner Lee Barnes says there are hurdles in the way.  Some of those hurdles are the very regulations that he wants Montgomery County to ease.  For example, Barwood can pick up anyone in Montgomery County, but cannot pick up someone outside the county unless their final destination is within the county.

“If we had one regional app, the problem is the rules would say that if you’re in Fairfax and one of my (Barwood) taxis is closest to you, they can’t do that.  So it would require some programming so the app only offers you taxis licensed to take fares,” says Barnes.

Another issue that came up was regulations on vehicle colors and owning cars.  Under current regulations, each cab company must have taxis with a specific color.  Berliner offered a proposal that he calls an “Uber Lite” option where drivers would be allowed to own their cars, own their special license, affiliate with a company, but not necessarily have to paint their car specific colors.

“We support a proposal where these rules on color would be lightened up.  We can have black or gray vehicles and operate as a taxi,” says Barnes.

Berliner says the special paint jobs to get these cars to match specific colors make drivers less likely to use their own vehicles.  But if those regulations were eased, more Uber-like deals could be set up within the cab companies.

The three sides sparred on special taxi licenses, known as PVLs.  Councilmember Hans Reimer suggested issuing 200 new PVLs to drivers.  But the proposal exposed a catch-22 for the industry.

More PVLs mean more drivers.  More drivers means more service and more competition against Uber.  But more drivers also means the average person would  earn less per day at a time where drivers are already complaining that they don’t make minimum wage.  Also if drivers resold their current PVLs, the value would be much lower than the purchase price.

So can the taxi industry survive?

Berliner says it’s a question open for debate.  He adds that there’s no easy answer.  Uber and Lyft might destroy the taxicab industry.  Or it may not.

“Yes, I believe I will be here five years from now,” says Barnes, when asked whether his company can survive against Uber.

However, Regency Taxi President David Mohebbi has the opposite opinion.  He repeatedly has told lawmakers that his company will be gone in a few years and only then will cab drivers realize the enemy wasn’t the taxi owners, it was Uber and Lyft.

Block believes the reality is probably somewhere in the middle.  Barwood and Regency won’t be out of business, but they won’t be thriving either.

“I think that the taxicab industry will wind up a niche business for the elderly, for the disabled, for those individuals who don’t have an iPhone or other smartphone,” says Block.

Berliner is scheduling more hearings and debate on all the issues, calling them a complex puzzle that interconnect with each other. He also tells WTOP that he wants to wait until the General Assembly and the Maryland Public Service Commission in Annapolis make decisions on the Uber question before recommending a proposal to the entire council.

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