Transportation Policy

Good News From L.A.: Despite Official Ban, Ride-Offering Services Still Function, Angering Taxi Cartel


Good news from Los Angeles: the City Council's attempts to shut down rivals to the taxi cartel are failing as a ban goes unenforced, mostly.

Details from L.A. Weekly:

Los Angeles declared war on ride-sharing on June 24, with a letter from City Hall ordering three companies — Uber, Lyft and Sidecar — to shut down or face criminal charges. On the same day, Yellow Cab and the other established taxi companies launched their own attack, declaring the startups to be "high-tech bandits" and announcing a taxi drivers' rally at City Hall.


One of the advantages of being an entrenched oligopoly is that your lobbyists can coordinate closely with regulators. The next day, the taxi industry packed the room at a City Council committee hearing. The ride-share companies were caught flat-footed. The lone Lyft supporter at the meeting — a driver with no official position with the company — was cross-examined and then dismissed as the council members vowed to press ahead with the crackdown.

Fortunately for Uber & co., however, often there is a wide gap between what the city says it is doing and what it does….And so the ride-share companies have continued to operate as before, blithely ignoring the decree from City Hall. Thus far, they have been unimpeded.

The new mayor, Eric Garcetti, has publicly praised the ride services as well. As the story goes on to detail, official taxi company attempts to emulate the phone-app model for summoning rides don't work nearly so well in L.A.

The Department of Transportation, which handles taxi regulations, has backed off its threat to arrest ride-share drivers. So far, LAPD is not enforcing the cease-and-desist order, and — despite rumors to the contrary — the L.A. Airport Police says its officers are not pulling over cars with pink mustaches. (In the last two months, the airport police ticketed two Uber drivers.)

Tracy Oppenheimer blogged about the feckless crackdown attempt when it was first announced.