Bankrupt Yellow Cab swallowed up by smaller competitor
The most recognizable taxi operator in San Francisco, Yellow Cab Co-Op, has been bought by a competitor for $810,000.
Big Dog City Corporation, which operates rival taxi company Citywide, purchased Yellow after outbidding Minneapolis taxi company Cabtopia in a federal bankruptcy court auction on Friday, making it truly the biggest dog in the San Francisco taxi market.
Sam Singer, spokesperson for the Yellow Cab trustee, told SFBay:
“Citywide purchased the name, the phone number, and the intellectual property. … This is an important sale because it keeps Yellow as a brand and as a company that keeps the cabbies and passengers all working together for the future which is good not only for the future of San Francisco but for the drivers and passengers as well.”
The brightly-painted sedans and SUVs of Yellow Cab dominated San Francisco streets for decades, before ride-hailing upstarts like Uber and Lyft shifted the landscape of for-hire transportation to private vehicles and comparatively under-regulated drivers.
The current co-op form of Yellow Cab is a 40-year-old company originally borne out of bankruptcy of its predecessor namesake. The co-op itself filed for bankruptcy in January 2016.
The co-op’s bankruptcy stemmed from a decrease in fares due to the rise of ride-hailing competitors, and from the increasing burden of lawsuit settlements for the company, piled up during years of “self-insurance” by the company. Litigants included a passenger left paralyzed after a Yellow taxi crash on Highway 101, to whom the courts awarded an $8 million settlement in June 2015, according to the Examiner.
John Lazar, owner of Luxor Cab told the Examiner:
“The reason Yellow is going down I’d say is more because of their auto accidents, their liabilities. … They got beat up in court.”
The impact of the purchase of one of The City’s largest cab companies is unclear for the larger San Francisco taxi industry. David Trotman, a longtime cab driver and trainer, told SFBay that the moment for the taxi industry has passed, especially with companies like Uber and Lyft who are able to undercut them on the price of a fare:
“When the apps first came onto the scene they were offered to the taxi industry who unfortunately turned them down and the rest is history. … Behind the taxi industry is the City, so I think there will be no significant changes and what you see now is what you’re gonna get.”
Transfer of the assets from Yellow Cab is expected to be finalized by late April.