Harry here. We get asked about the future of the taxi industry a lot and while their market share is declining, it seems like there are still lots of taxis on the streets. Today, senior RSG contributor Christian Perea takes a look at what the taxi industry needs to do to not only survive, but thrive against rideshare giants like Uber and Lyft.
I’m sure I don’t need to tell anybody that the taxi industry isn’t doing so well these days. In fact, over the past 5 years the entire industry has been crushed and overrun by transportation network companies (TNCs) like Uber and Lyft. And it seems like every person with a car and a smartphone is scouring through the streets and stealing their rides. Uber and Lyft have also managed to get laws and regulations passed in a majority of states that essentially legalize rideshare and establish separate regulations for them.
Cabs claim these separate rules create an un-level playing field by allowing TNCs to flood the streets with cars and charge (much) lower prices than cabs can charge. A lawsuit against this anticompetitive nature was recently shot down, allowing for separate regulations for TNCs to continue.
To make matters worse, after years of “My credit card machine doesn’t work! Let me drive you to the
nearest farthest ATM!” the public doesn’t have much sympathy for the cab industry, which they have demonstrated through their wide adoption of Uber.
So what can Big Taxi do to survive in the 21st Century? What is going to happen when their clientele dies off? Well it doesn’t seem like Uber is going away anytime soon so maybe traditional cab companies should become TNCs themselves and fight fire with fire.
The lines are already blurred. TNCs are becoming more like traditional cab companies in many ways, with vehicle rentals, leases, disgruntled drivers, and a separate regulation model. Some taxi companies have built their own apps and started to recruit disgruntled TNC drivers. So here’s what taxis need to do to survive Uber and Lyft.