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Thursday, January 20, 2022

Pandemic Wiped Out NYC’s Taxi Industry & Now Uber Prices are Soaring

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By: Hadassa Kalatizadeh

As New York City continues to recover from the pandemic, yellow taxis seem to be missing in action at busy street corners and airports.

As reported by the NY Times, many taxi fleet owners slashed operations or closed them completely when the pandemic forced commuters to stay homes.  Now, there are only an estimated 6,000 cabs in the city, as per the Times.   That’s less than half of the outstanding 13,500 medallions, or city-issued permits for operating a yellow cab.  Of these, about 5,700 were taken off the road indefinitely by owners who returned the license plates voluntarily.

Taxi companies were already ailing when the pandemic began, from competing with Uber and Lyft, which operated at lower costs with no medallions, while taxi firms became debt ridden paying for the inflated medallions.

Now, as many employees are trickling back into their offices and travel has opened back up, the demand for cabs has returned.  It seems, though, that it is now the riders’ turn to feel frustrated and abandoned.  Ride-hailing apps have subsequently raised their prices, switching to “surge pricing” due to the lack of supply.

Still, taxi owners are hesitant to get their cabs back on the road, fearing that the demand will be short lived, as a result of the holidays.  While tourists and business travelers have started making their way back to the city, the threat of the new Coronavirus variants and the winter season may put a damper on the impending recovery.  “Why are we going to put our toe back in the water if we’re not going to be able to survive,” said Richard Wissak, whose family operates 140 taxis, but took the cars out of service last year to save thousands in insurance, taxes and fees.

Also, many small taxi owners, with a single medallion, have been getting a stay on their loan payments temporarily, due to the pandemic. They fear that when they start working again, the payments may need to start again, and they don’t know if they will be able to afford them, said Bhairavi Desai, the executive director of the New York Taxi Workers Alliance.  “They don’t want to go back to work before there’s substantial debt restructuring,” said Ms. Desai, whose group began a fund to assist taxi owners in paying off their medallions  at lower prices.

Furthermore, there is a lack of drivers.  Some drivers who got expanded unemployment benefits from the pandemic, still are not back to work, and others have found alternative delivery jobs or have moved away.

 

 

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