New York City Cabs To Allow Carsharing Via Apps

Carpooling may not be a favorite among commuters who don’t want to share a cab with a complete stranger, but it is a cheaper way to get around and is a big focus of Uber and Lyft. Now, New York City’s yellow taxis are getting into the game, enabling riders to legitimately share a cab.

Arro, the app that hails taxies for you, and Bandwagon, which is testing a taxi-sharing technology at LaGuardia Airport, will provide the ability for commuters to share yellow taxis via their apps. Arro is owned by Creative Mobile Technologies (CMT), the payment services company that maintains the payment systems and video screens in thousands of taxis. CMT will integrate Bandwagon’s taxi-sharing technology with Arro’s taxi-hailing app. The service is expected to be rolled out by the end of the year. At that point, customers can opt to share their solo ride and get a cheaper fare in return. The feature will be available via both Arro’s and Bandwagon’s app.

For New York City taxi cab drivers, the new feature could mean more money for them at a time when they are seeing increased competition from Uber and Lyft, with Uber just recently announcing it has completed 2 billion rides. According to comments Bandwagon Chief Executive David Mahfouda made in a report by The Verge, drivers in New York City will not only see higher fares, which means higher tips, but they also get an extra $2.50 for making an additional stop.

It’s no secret that Uber, Lyft and other startups in the taxi/carsharing business are going to steal customers away, but it doesn’t mean there will be an end to the iconic yellow cab anytime soon. According to the most recent data published by New York City’s Taxi and Limousine Commission, in April, there were 11.1 million taxi trips, with an average of 400,000 trips a day. That’s a 9 percent decline from a year ago, but it is still more than Uber. Morgan Stanley found in a recent research report that, in April, Uber had 4.7 million rides, which is a 121 percent increase year over year. But while Uber saw an increase in usage, Uber dispatches a similar amount of drivers per week as taxi companies, which indicates taxi drivers take about twice as many fares a week as Uber drivers do.