Los Angeles Rideshare Services Stand Up to Dept. of Transportation and Grumpy Cabbies


The Los Angeles Department of Transportation issued cease-and-desist letters Monday to phone application companies that provide car-for-hire services. Nevertheless, Los Angeles rideshare services Lyft, Sidecar, and Uber say they will continue operating. The Los Angeles Times reports:

Lyft and Uber said they have agreements in place with the California Public Utilities Commission that permit them to operate statewide. Both companies said they plan to continue operating in Los Angeles.

"We already signed an agreement with the California Public Utilities Commission explicitly stating that Uber services, including the eco-friendly UberX, are authorized to operate statewide," an Uber spokesman said.

The letters from the city said drivers of the services may be subject to arrest and could have their cars impounded for as long as 30 days. The letters were  followed Tuesday by taxicab driver protests at City Hall against the ridesharing services.

"These companies have no permits, and that's a real concern to us," said Thomas Drischler, the city's taxicab administrator. "That raises safety issues."

Sidecar announced it would maintain business as usual, but we can expect cabbies to keep making a stink, per dailybreeze.com:

"These rogue taxis are bypassing all safety regulations created to protect riders and drivers," William Rouse, general manager of Los Angeles Yellow Cab, said in a statement. "Not only are these high-tech bandit cabs unsafe, they are breaking regulatory standards and disenfranchising safe, legal taxi drivers."   

The only thing these clean and convenient bandit cabs stole were the hearts of disgruntled taxi passengers. Uber is more of a deluxe taxi service, but Sidecar and Lyft are purely "donation-based." They represent a completely free market as the prices are solely driven by untampered supply and demand.

How it works: passengers pay what they think is appropriate for a certain trip based on time, distance and service. The service's database keeps tabs on all of these payments, and in return has suggested amounts that future passengers can then use for reference. If you're thinking, "can't I just pay nothing since there is no price requirement?" Well, you can. But don't ever expect to get picked up again.


That's the other component of the business plan—it's completely ratings-based. If you err on the extremely frugal side, the driver will make a note of it in the database, drivers will see that addendum and will probably not respond to your future pick-up requests. Like-wise, if you leave a hefty tip, you'll probably get picked up in record time down the road.

Same goes for the drivers. They are all volunters. While there aren't any formal licenses (beyond a driver's license), the companies do vet the drivers before they can sign up officially. Good drivers tend to get high ratings from passengers, and are thus requested more often. Bad and/or creepy drivers get bad ratings, fewer and fewer requests, and are removed from the service. This is probably far more effective than any standardized driving test considering the average cab ride's swerves and abrupt stops.

On to the main critique: Can these services guarantee passenger safety? They can't, not completely. But these services are more accountable than taxis. Their databases have a complete record of each transaction including information on the passenger, driver, where they went, how much was exchanged, etc. If you get in a taxi on the side of the road and the cabbie decides to kidnap and murder you, there probably won't be a record of it. If a Lyft driver decides to cause some mischief, he/she probably won't get too far.

Lyft, Uber and Sidecar also understand the use of modern technology like using phone apps and those credit card device things. This competition is utterly necessary and should incentivize traditional cabs to improve their quality across the board. Instead the cabbies are spending their time protesting these "bandits" in front of city hall.

NEXT: High Taxes, Red Tape Fuel Large Israeli Shadow Economy

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. "These companies have no permits, and that's a real concern to us," said Thomas Drischler, the city's taxicab administrator. "That raises safety issues."ey need to wet our beaks!"

    1. Shorter version: "Fuck you, pay me."

  2. I was a taxi driver for a company with near-monopoly protections (through local politicians and the PUC) and boy was it easy to make great money when there was no competition for the customers to call. I can't count how many times I overheard a dispatcher say something to the effect of "You don't like waiting, fine, call the other taxi company,." (laughs, hangs up)

    This situation is rare, but it's what taxi companies always seem to be striving to achieve in my experience. It's oft an ugly business and for sure that's because of government interference in what is basically giving someone a fucking lift.

  3. "These rogue taxis are worse than Hitler," William Rouse, general manager of Los Angeles Yellow Cab, said in a statement.

    1. Activia!

  4. If you air on the extremely frugal side

    Is John the new editor?

    1. Good won !

    2. This is what happens when you let homo(nym)s marry!

      1. +Internet

  5. People are exchanging services for money!!! VOLUNTARILY! This must be stopped!

    1. What percent of the population would side with the government certified taxis, instead of the rogue bandits breaking the regulatory standards ? Base on nothing but my gut, I'd say more than 50%.

      1. 40-45%

      2. Might be a difference of opinion between "population" and "population who rides taxis."

  6. Hey cab companies--FUCK YOU! Mercantilist assholes. Normally I would hope the your death is long and unpleasant but in this case short and unpleasant is the way to go.

  7. I'm wondering if the cab drivers and the cab companies think a single person (other than those in the LA city/county governments) actually believe them when they say their concerns are over safety.

  8. I love when my AM and PM links get featured in H+R posts

  9. Anyone who uses, or drives among, taxis much must be extremely amused by the safety objection to these services.

  10. This is how we win. It will be a long guerilla fight but eventually it will not only break down these crony interests, it will change them from seeking government protection to wanting no more of it. Again, it will be long, but time is on our side.

  11. So the idea is that these unlicensed cabs are shady and dangerous compared to...licensed taxis? Have the people who are advancing this argument ever BEEN in a licensed taxi in a big city? There are very valid reasons why cab drivers are stereotyped as being dangerous maniacs on the road.

  12. Few improvements should be done in this regard! From Auto Shipping companies some good quality transport could be ship to enhance customer satisfaction.

Please to post comments

Comments are closed.