{"id":3100,"date":"2015-09-10T08:00:55","date_gmt":"2015-09-10T12:00:55","guid":{"rendered":"http:\/\/www.taxifarefinder.com\/newsroom\/?p=3100"},"modified":"2015-09-09T10:44:18","modified_gmt":"2015-09-09T14:44:18","slug":"are-taxis-gearing-up-for-a-comeback-against-uber","status":"publish","type":"post","link":"https:\/\/www.taxifarefinder.com\/newsroom\/2015\/09\/10\/are-taxis-gearing-up-for-a-comeback-against-uber\/","title":{"rendered":"Are Taxis Gearing Up For A Comeback Against Uber?"},"content":{"rendered":"

\"\"<\/a>We\u2019ve all heard the saying that \u201cit ain\u2019t over til the fat lady sings\u201d. \u00a0Growing up, I heard various renditions of this all the time since I participated in competitive sports. \u00a0And it\u2019s even something I recited to my own players as a coach later on in life. \u00a0But\u00a0there\u2019s a good reason why this saying is so prevalent in athletics\u00a0and business alike. \u00a0As anyone with experience can\u00a0attest to, it\u2019s hard to finish off a team, a company\u00a0or even an entire industry. \u00a0Nobody likes to lose.<\/p>\n

When Uber launched onto the scene with its flagship UberX product a couple years ago, its goal was to disrupt and take over an entire industry. \u00a0Taxis have long been an established part\u00a0of the American transportation scene but they were also the subject of much ridicule and angst. \u00a0Looking back, it\u2019s amazing that they made it this far without any real competition.<\/p>\n

\"\"<\/p>\n

But now that competition is here, it\u2019s here to stay. \u00a0Uber recently topped out at a\u00a0$50 billion<\/a>\u00a0valuation and their current reach<\/a> spans over 200 cities and almost 60 countries worldwide.\u00a0 Lyft, their closest competitor is \u2018only\u2019 valued at $2 billion<\/a>\u00a0and has yet to even cross the border.<\/p>\n

Most new on-demand start-ups find that the best way to describe themselves is \u201cUber for X\u201d, and more than once, I\u2019ve had Lyft passengers refer to me as \u2018their Uber driver\u2019, apparently unaware that they were in fact in a Lyft. \u00a0So I guess you could say that Uber has done a pretty good job at brand awareness.<\/p>\n

But even though customers applaud the ability to hail a ride from their phone, pay with a credit card and rate their driver, taxis just won\u2019t seem to go away. \u00a0Not yet at least. \u00a0Granted, Uber cars do fly a bit under the radar since they\u2019re not painted bright yellow, but whether I\u2019m in Boston, Los Angeles or San Francisco, it still seems like taxis are always hanging around.<\/p>\n

They aren\u2019t as common a sight\u00a0as they once were,\u00a0but by no means have they gone the way of the phone booth just yet. \u00a0Taxis still have strongholds at airports, are the only option in cities like Las Vegas<\/a> and unlike Uber, they have always been allowed to accept street-hails. \u00a0So there are actually still some pretty big advantages to being a cab driver.<\/p>\n

Taxis Fight Back (Sort Of)<\/strong><\/p>\n

Initially, the taxi industry\u2019s response to Uber was a slew of ill-fated protests and complaints to government officials. \u00a0Most of these protests ended up serving the opposite purpose though as\u00a0Uber\u2019s downloads often increased by hundreds of percentage points<\/a> on taxi protest days.<\/p>\n

You can\u2019t really blame taxis\u00a0for trying though, their industry was under attack and they were fighting back. There\u2019s no doubt that Uber does have an unfair advantage: they save money with less stringent on-boarding processes and ignore many of the licensing requirements that taxis have to go through.<\/p>\n

I recently explored some of these requirements on my podcast<\/a> with Woody McKee, the owner of a North Carolina-based taxi company and was shocked to find out that for example, every time he wants to onboard a new driver he has to make a trip to the DMV. \u00a0It\u2019s regulations like this that make it nearly impossible\u00a0for hard-working taxi owners to provide Uber-like services.<\/p>\n

Uber Has Instituted Change Amongst Taxis<\/strong><\/p>\n

Whether or not you agree with Uber\u2019s tactics of \u2018innovate first, regulate later\u2019, there is no denying that they have created a more competitive marketplace. \u00a0And in response to this competitive marketplace, we are starting to see changes\u00a0in the taxi industry that would have once been\u00a0unheard of.<\/p>\n

Recently, Long Beach, CA<\/a> CA -3.70%<\/a> became one of the first cities<\/a> in the nation to remove certain requirements and encourage taxi companies to operate more like rideshare companies. \u00a0Among the changes instituted: the ability to offer discounted fares, re-brand itself, increase its fleet size and offer free rides and promotional pricing. \u00a0All of which, appear on the surface at least, to benefit consumers.<\/p>\n

Long Beach\u2019s mayor summed it up best by saying,\u00a0\u201cWe had a system that was very antiquated. \u00a0We\u2019re trying to create a service that\u2019s somewhere in between a traditional cab service and a traditional ride-sharing service.\u201d \u00a0It\u2019s a shame that it took a company like Uber to institute such radical change but customers deserve better.<\/p>\n

Another recent innovation comes in the form of an app called Bandwagon<\/a> that aims to match taxi passengers headed in the same direction. \u00a0I know there have been times in my life where I have been standing in a taxi line and was tempted to ask if anyone was headed to the same area as I was ($50 cab rides will do that to you).<\/p>\n

I was always too shy to ask, but apps like Bandwagon will take care of that awkwardness for you. \u00a0They work by requiring passengers to enter route information and they will match two passengers headed to the same general area. \u00a0You can then use Bandwagon\u2019s interface to split the bill and pay\u00a0the cab driver.<\/p>\n

It actually works a lot like another Uber innovation, UberPool (Lyft has an identical service called LyftLine). \u00a0But since taxis are the only legal option at most airports<\/a>, it\u2019s a pretty\u00a0valuable service, for now. Five years ago, taxi companies working with an app that would actually reduce the number of available passengers would have been crazy but\u00a0Uber has forced them to change.<\/p>\n

Don\u2019t Call It A Comeback<\/strong><\/p>\n

During Uber\u2019s meteoric rise, taxi drivers were leaving in droves to come work for Uber and be their own boss. \u00a0It wasn\u2019t even unheard of for career professionals to leave their corporate jobs and go become Uber drivers. \u00a0But a lot has changed over the past year. \u00a0Uber has slashed UberX fares<\/a> 3 times in major\u00a0markets and the current situation for drivers isn\u2019t quite so rosy.<\/p>\n

I\u2019ve detailed just some of the gripes<\/a> drivers have against Uber but many of the best Uber drivers are long gone by now. \u00a0By Uber\u2019s own admission, driver retention is at just over 50%<\/a>\u00a0after one year. \u00a0They still have plenty of drivers but there\u2019s no doubt among the driver community that lower rates have turned away some of the best drivers. \u00a0Many passengers have also echoed similar feelings.<\/p>\n

Justin Gordon, a frequent Uber passenger from Santa Monica, CA told me, \u201cThere\u2019s a noticeable difference between drivers today and one year ago. \u00a0Today, Uber drivers drive more erratically and seem like they\u2019re just trying to get the job done. \u00a0It\u2019s definitely only a minority of drivers, but still, this is why I stopped using\u00a0taxis: because I prefer the more personal rideshare experience.\u201d<\/p>\n

These poor experiences with Uber are few and far between but from passengers and drivers I\u2019ve talked to, they are happening with more frequency. \u00a0Uber has built up a lot of goodwill with its passengers so there\u2019s some leeway for bad experiences but if this becomes a trend it could spell trouble. \u00a0Gordon did note however that\u00a0despite these few bad experiences, he still exclusively takes Uber because of their current $5 UberPool fares.<\/p>\n

It\u2019s probably a stretch to say that Uber is reverting back to the taxi experience. \u00a0There are some aspects that they have changed for the better that can never be undone. \u00a0But if taxis can get their act together, there may be room for a comeback. \u00a0And it seems like they\u2019re doing just that by changing regulations, allowing riders to carpool and it\u2019s even been reported that some Uber drivers are converting their personal cars to taxis in NYC<\/a>.<\/p>\n

The Blueprint to Success<\/strong><\/p>\n

If\u00a0taxi companies are going to make a comeback in the fight against Uber, they\u2019ll need to do exactly what Uber did. \u00a0Uber\u00a0was able to upend the entire taxi industry because they created a product that solved all of the most common complaints about taxis. \u00a0Their app allowed you to pay by credit card, track and rate your driver and their \u2018fleet of cars\u2019 was\u00a0much nicer than taxi fleets since drivers were utilizing their\u00a0personal vehicles.<\/p>\n

Despite all of Uber\u2019s success, there are still plenty of opportunities\u00a0that a smart taxi industry will be looking to take advantage of.<\/p>\n