NYC's Cap On Uber Is Just the Beginning

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In August, Uber faced a major setback in New York City as its Council voted to cap the number of ride-hail vehicles allowed on city streets. The tech giant that transformed urban transportation has lost in another clash with local government and its largest American market of 8.5 million NYC residents.

The New York City Council voted to halt the issuance of new licenses for Uber, Lyft, and other ride-hail operations for a year to give the city time to study the growing industry and set a minimum pay rate for drivers in the wake of six taxi-driver suicides. Additionally, the move will prevent further street congestion since the number of for-hire drivers has increased by approximately 40,000 since 2015.

NYC is the first major US city to set these standards for ride-hail vehicles. Uber has faced numerous challenges in other cities; it was banned in London until its appeal to overturn was upheld in court this past June and is banned in the state of Oregon except for Portland. With the passing of the NYC legislation, both critics and supporters predict that other cities may attempt to rein in ride-hail services.

The issues NYC addresses in its recent legislation opens the conversation to environmental concerns against the sudden proliferation of ride-hail operations the past six years. Uber has claimed that more for-hire vehicles on the road mean fewer personal cars and thus, reduced carbon emissions; however, there is very little evidence proving this to be true. Not only are additional for-hire drivers crowding streets, but the thicker congestion has also led to more carbon emissions – which is bad news considering transportation now replaces power plants as the largest producer of greenhouse gases.

Regardless, out of the virtual ride-hail providers in the U.S., so far Lyft is kinder to the environment than its competition. In the spring of 2018, the second-largest ride-hail company announced its intention to deliver carbon-neutral rides via carbon offsets. Lyft’s total investment will amount to over a million tons of metric carbon and make Lyft one of the largest voluntary purchasers of carbon offsets in the world. Although carbon offsets have their own array of faults and criticisms, this announcement is more than any other ride-hail service has promised. Given that Lyft only operates in the US, whereas Uber operates internationally, the $11 billion dollar company has fewer cars to offset than its competition.

On the other hand, Uber has recently become multi-modal by incorporating scooters and bikes in certain cities, as well as acquiring Jump (an electric bike-share startup) and investing in Lime (a bike-share and electric scooter company). These moves came as responses to both NYC Council’s legislation and reports from city transport authorities on worsening congestion on city streets. Transportation expert Bruce Schaller found that 60% of people who hail a ride would have walked, biked, or taken public transportation if the service had not been available in his July report.

Since the bill passed the NYC Council, Uber and Lyft are wary of how other cities may respond to the ever-booming industry. At this time, other cities have not publicly voiced capping ride-hail vehicles. As environmentally-conscious consumers, it's important to celebrate pledges of carbon-neutrality and the integration of bike-shares, but not to get distracted by them. Regardless of the results following the NYC Council’s transportation study, urban transportation could be, at all levels, more inclusive of renewable alternatives.

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