Nashville Slashes Mandatory Limo Prices, Increasing Potential Local Competition

Uber Black finds a new service market


Fight for their love, livery services!
Credit: joseph a / Foter.com / CC BY-NC-SA

In a victory for competition in Nashville, its City Council has severely reduced its taxi protectionism by slashing the minimum fee limo or livery drivers must charge from $45 all the way down to $9.75.

From The Tennessean:

Council members approved the $45 fee in 2010 as a way to distinguish between taxis and livery vehicles, but some later came to think they had set the minimum too high.

The change also will allow San Francisco-based Uber, an app-based service that's in about 30 cities across the United States and 70 around the world, to come to Tennessee for the first time. Uber customers use a smartphone app that stores their credit card information to order a ride. When they do, the GPS-powered software contacts drivers of private cars in the area and gives them a chance to make the trip.

Uber plans to start operating its top-level Uber Black service in Nashville as soon as Mayor Karl Dean signs the bill into law, spokeswoman Nairi Hourdajian said.

Not mentioned in the story is that the Institute for Justice had filed suit against Nashville in order to overturn the absurd price floor. But last year a jury ruled on behalf of the City of Nashville, upholding the law. It's notable that a city council, having been told that their anti-competitive meddling is perfectly legal, nevertheless realized that it's a bad idea for its citizens.

The Tennessean concludes by noting that while critics complained that the new minimum would cut into taxi drivers' businesses (appropriate response: So?), there wasn't a big presence by cab drivers at the council meeting.

Hat tip to Dan Alban of the Institute for Justice