Competitors squeeze SF taxi industry

The City’s taxi industry — a fixture in San Francisco for more than 100 years — is hurting.

The average number of trips per vehicle have declined from about 1,400 in March 2012 to 500 in July of this year, according to the San Francisco Municipal Transportation Agency.

The new Director of Taxis and Accessible Services Kate Toran said it was clear and obvious that transportation network companies have had an impact to the taxi industry in The City:

“The elephant in our room are in our streets. The arrival of the TNCs. The TNCs — transportation network companies such as UberX, Lfyt and Sidecar — have dramatically changed the landscape in the for-hire transportation industry.”

TNCs, regulated by the California Public Utilities Commission, operate under a separate set of regulations from taxicabs. Significant differences include insurance requirements compared to the taxi industry.

Legislation signed by Gov. Jerry Brown Wednesday set new insurance standards for transportation networking companies like Uber and Lyft based on a compromise reached with the companies last month.

The issue drew attention in San Francisco earlier this year when Uber driver Syed Muzzafar, 57, struck and killed 6-year-old Sofia Liu the night of Dec. 31.

As originally introduced by Assemblywoman Susan Bonilla, D-Concord, the bill would have required the companies to provide $1 million any time a TNC driver’s app was activated, regardless of whether there was a passenger in the car.

Uber objected strenuously to the bill, and the final version was reached by compromise with Uber and Lyft and passed by the legislature last month.

Its requirements are similar to the policies Uber and Lyft had already voluntarily enacted — $50,000 coverage per injury in an accident with up to $100,000 covered, and $30,000 for property damage before the driver picks up a passenger. It will take effect next July.

The taxi industry, regulated by the SFMTA, have a number of regulations and codes of taxi drivers and vehicles including background checks and environmental regulations — compared to TNCs.

Ramp taxis, which pickup wheelchair users, have also seen sharp decline to pickups from about 1,350 trips in January 2011 to about 750 in June this year.

Toran said ramp taxis are costlier to run because of gas costs and required maintenance.

She said the transit agency has taken steps by reducing or waiving fees worth about $3.5 million to keep drivers in the taxi industry.

The response from taxi drivers has been to join electronic hailing applications such as FlyWheel to compete with TNCs.

Toran said 80 percent of the taxi fleet is on FlyWheel. FlyWheel’s average pick up time is 3-1/2 minutes.

SFMTA Board Director Malcolm Heinicke said the transit agency should require drivers to join a taxi app unless he’s told otherwise that it’s a bad idea:

“The public needs to know that there are these apps out there. The public needs to know that these response rates exist. That’s the way the cab industry is going to keep pace. Frankly that’s the way the cab industry is going to serve San Franciscans.”

DeSoto’s cab president Hansu Kim, who has been a regular public commenter at many of the SFMTA board meeting on taxi related issues, agreed with Henicke.

Kim said the cab industry can still remain viable transportation option in The City:

“We can beat these services at their own game. We can. We can have a vibrate taxi industry Even in a deregulated market. I wouldn’t still be in the taxi business if I didn’t believe that.”


Bay City News contributed information to this report.