Skip to content, or skip to search.

Skip to content, or skip to search.

Hail Storm

As the tech companies have been plotting this soft coup, the city has—after an extended, contentious back-and-forth with the old-line taxicab owners—introduced a second fleet of cabs, painted a precise custom shade of lemon-lime green. They’re allowed to pick up passengers anywhere outside central Manhattan, and drop them off anywhere. (Their drivers reportedly hate going downtown, because that commits them to a long drive back into their zone without a fare.) Both yellow and green cabs are all geolocatable, owing to the onboard Taxi Technology System; every fare can be paid with a remarkably un-prone-to-breakdown credit-card system. Even the backseat TVs feel like an innovation, if an irritating one. We are also, perhaps, about to see the citywide introduction of a purpose-built cab, the Nissan NV200, a.k.a. the “Taxi of Tomorrow,” though it’s been fought by both the fleet owners (who want more vehicle options) and advocates for the disabled (who were dismayed that it wasn’t wheelchair accessible).

As Crain’s noted last week, Medallion Financial, the only publicly traded taxi business with a large number of medallions, has seen its stock slide by a third in the past year. And no wonder: People have wanted better ways to hail a cab for a long time, certainly since GPS came along. (Food for thought: If one of the fleet owners—or the city itself—had created its own app, might it have pulled in the funding that Uber has?) The taxi interests contributed more than a quarter-­million dollars to Bill de Blasio’s mayoral campaign, looking for pull. As public advocate, he’d come out against the Taxi of Tomorrow plan. Yet for all their contributions, the fleets got—well, less than they expected. Lyft has been approved, the Taxi of Tomorrow seems likely to arrive (in some form), and more green cabs are coming. There’s even talk of legitimizing more of the dollar vans that ferry outer-­borough residents to and from subway termini. The monopoly has been broken.

So far, Uber appears to be pinching traditional car services—Carmel, Dial 7, and the like—hardest. (They have apps, too, but Uber’s is the one you’ve heard of.) The big question is about the prices for medallions, because so much of the yellow-cab business depends on their future value. Solo operators, who own 42 percent of the medallions, may be the most vulnerable. The fleets are big businesses, many of which bought their medallions decades ago for peanuts. They’ll be okay. But consider a guy in Elmhurst who is leveraged out the window to pay for his medallion, and leases his car at night to other drivers just to cover the payments. Eventually, it will be his kid’s tuition, his Florida condo, his IRA—unless he’s underwater, with a medallion that cost him $700,000 but is worth much less.

And it’s hard to see how those prices won’t slip. Medallions, after all, are part of a top-down system formed to fight the ­abuses and dangers of the old crooked New York: rattletrap cars, overclocked meters, bribed inspectors. Its heavy regulation in turn empowered the taxi lobby and (somewhat) the drivers union. That system may be a pain to deal with, but in its defense, it provided predictability and security. The loosey-goosey libertarian alternative, conceived in the clean Northern California air, calls upon the market to provide checks and balances. A poorly served passenger can, instead of turning to a city agency for recourse, switch allegiances or sue. When a smartphone-hailed car cruises up your Brooklyn block, it brings with it a little of Rand Paul’s America, fronted with a pink mustache.