Can Taxis Survive Competition from the Sharing Economy?

As the rise of transportation network companies (TNCs) globally erodes the franchises of locally regulated taxis, cities are at risk of losing their regulated, insured cab fleets. Municipalities are weighing ways to capitalize on new technologies while still maintaining options for passengers across neighborhoods and socioeconomic levels.

Drawing on remarks recently made on the VerdeXchange 2015 Conference panel "How Technology and Competitive Drive Are Reinventing Mobility and the Urban Environment," Bill Rouse, General Manager of Yellow Cab of Los Angeles, and Gabe Klein, a Special Venture Partner at Fontinalis Partners with experience leading public-sector DOTs, offered their perspectives on changes to urban ground transportation.

Klein provided an example of a city proactively addressing the problem: "Washington D.C. is leading the way—as it has on things like bike share, circulator buses, and streetcars. The D.C. model for deregulation of the taxi industry—creating a co-op as a virtual layer of management that unifies the taxi industry—and putting every taxi in the city on one app creates an environment of healthy competition. It’s allowing the taxi industry to step up its game. At this point, most of the taxi companies want to step up their game if the government would let them."