The yellow cab industry may become extinct soon, according to Chicago cabbies.
With Uber and Lyft soaring to new heights in the sharing economy, cab survival is hard to maintain. Data shared by the Chicago cab and taxi drivers union this week revealed 42 percent of the windy city’s cabs weren’t in operation during March, and there’s been a 40 percent revenue decline over the past three years. While cab medallions saw a decline in value — going from $5,276 in 2014 to $3,206 today — cab hailers declined from 2.3 million to 1.1 million.
Ridesharing services are hitting all of the major metropolitan areas.
Over the past three years, NYC saw a 30 percent decline, while San Francisco’s taxi company filed for Chapter 11 bankruptcy and Los Angeles’ ridership fell 43 percent.
“When they opened up ground transportation and taxi market to thousands of for-hire vehicles like Uber, Lyft and now Via ... taxi driver income has been decimated and owner-operators are unable to keep up with loan payments for their medallions plus their high-operating costs. As a result of that, hundreds of taxi owners-operators are facing foreclosures on their medallions, and thousands more foreclosures are likely unless the city takes substantial action to reduce the financial burden on small taxi owners,” said AFSCME’s Associate Director Tracey Abman.
The Illinois Transportation Trade Association filed suit against the city of Chicago, arguing it was unconstitutional to enforce two sets of rules for taxi and carsharing apps, making competition obsolete. The U.S. 7th Circuit Court of Appeals rejected this argument last October.
Judge Richard Posner’s closing dissent stated, “Were the old deemed to have a constitutional right to preclude the entry of the new into the markets of the old, economic progress might grind to a halt. Instead of taxis, we might have horse and buggies; instead of the telephone, the telegraph; instead of computers, slide rules.”