Number of Taxi Cab Rides in Boston Plummeting
When was the last time you took a taxi somewhere? Hard to remember, right?
New numbers from the Boston Police Department hackney carriage division indicate your experience is typical because taxi drivers suffered a 22 percent decline in business through June of this year.
A Boston Globe review of the data showed the steep drop in rides for taxi cabs amounted to a decline of $33 million in fare revenue through the first half of the year.
The new information comes at a time when the traditional taxi industry is under assault from upstart ride-hailing apps Uber and Lyft. Taxi drivers and medallion owners are terrified at the rise of the new companies because they believe they are cutting into their longtime government sanctioned monopoly. Uber started operating in Boston in 2011 while Lyft moved to the city in 2013. Data shows that their effect on the industry was not really felt until this year. The Globe reported that drivers who once made $700 to $800 a week in profit now make less than $200 a week, if anything.
The collapse in taxi usage has resulted in medallion owners losing their shirts, as the pricey licenses to operate a cab that cost more than a house are losing their value. Even Medallion Financial Group, a business that focuses on lending to cab driers and medallion owners, has suffered due to the rise of Uber and Lyft. Medallions that at one time were guaranteed investments and traded hands for $700,000 now go for $350,000 at foreclosure auctions.
The stakeholders in the taxi industry have responded to the collapse of their business in a manner that seems counterintuitive: they are badgering government officials to make ride-hailing apps subject to the endless regulations that make driving a taxi difficult.
Taxi drivers are pushing for legislation that would essentially regulate ride-hailing apps out of business and return the market to its pre-Uber state. A number of bills are currently pending on Beacon Hill, but some form of statewide regulation is expected to make its way to Governor Charlie Baker’s desk this year. Baker is a fan of the ride-hailing apps and has submitted legislation that would mostly allow the companies to continue operating like they are currently.