New York Times
POSTED: 1:30 a.m. HST, Jul 13, 2013
LOS ANGELES » After last call on Sunset Boulevard, the fledgling subway network here is no help for bar hoppers headed home. Sobriety checkpoints loom for anyone planning to drive. So taxis line the curb at 2 a.m., waiting for passengers.
But now licensed cabdrivers in this city where the car remains king are facing their greatest competition in half a century, from new ride-sharing programs that use smartphone apps to connect drivers and passengers.
At the end of a night of drinking recently, rather than hailing a cab, Trisha DiFazio tapped an app called Lyft on her phone to summon a ride. Minutes later, a graduate student moonlighting as a driver pulled up in a Toyota SUV with Lyft's signature pink mustache affixed to its grille.
"This is so much cheaper than a cab, and so much easier," said DiFazio, 31. "I absolutely think my friends drink and drive less because of this."
Transit experts say these new services, which appeal to younger riders, could play a crucial role in ending the reign of single-occupant cars (and unending traffic) in Los Angeles, and many young residents have embraced them as a cheaper, more reliable and, well, more fun way to get around the city. But some of the city's licensed cabdrivers have another name for ride-sharing services: illegal bandit taxis.
Last month, city regulators sided with the cab companies and sent cease-and-desist orders to Lyft and two other companies offering ride-sharing services, Uber and Sidecar, ordering them to shut down immediately. "It's the Wild West with these operators," said Tom Drischler, the taxicab administrator for the city's Department of Transportation. "You have folks driving private cars and picking up strangers. Public safety is our assignment, and I don't think it's safe for the public."
All three companies have refused to leave town, asserting that agreements they made with state regulators allow them to operate anywhere in the state.
Smartphone-based ride-hailing services have faced opposition from taxi companies and city regulators almost everywhere they have appeared, from Las Vegas to Cambridge, Mass. But the fight here is complicated by longstanding efforts by city officials to alleviate traffic and reduce drunken driving.
Last week, on his first full day in office as the new mayor of Los Angeles, Eric Garcetti proudly proclaimed that Los Angeles was beginning to leave behind its culture of car ownership. And Juan Matute, director of the Local Climate Change Initiative at the University of California, Los Angeles, said that if more people used ride-sharing services — even just 3 percent of the population, he said — substantial reductions in driving in Los Angeles could result.
"It would be easier to share rides that are incidental to daily life," he said.
Unlike the new companies, the taxi industry here, which pays about $4 million a year to the city in franchise fees and vehicle permits, is tightly regulated for safety.
In addition to franchise and inspection fees, regulated taxis have to serve far-flung and low-income parts of the city where Lyft drivers need not venture. The city also requires cab companies to offer disabled-accessible vehicles, which William Rouse, general manager of Los Angeles Yellow Cab, said his company did at a loss. "If they're going to skirt our entire cost structure," he said, "then they're going to be able to get away with charging less and still make a profit."
Rather than a metered fare, Lyft has a suggested donation, typically about 20 percent cheaper than a cab. Riders can pay as much or as little as they like, although those who frequently shortchange drivers have a tough time getting rides.
Jano Youssefi, an Iranian immigrant who has driven cabs in Los Angeles for 15 years, said his income had dropped at least 20 percent in the six months since Lyft rolled into town. "We are not making money anymore," Youssefi said.
Yet, even as the threat of arrest hangs over drivers — some Lyft drivers removed the pink mustaches from their grilles after the cease-and-desist order — interest in the new programs seems to be on the increase. Drivers for Lyft and Sidecar use their own cars, and typically keep about 80 percent of the payments passengers offer, while the company keeps the rest. Uber also offers a service that connects passengers with licensed, professional luxury car drivers, as well as people driving their own cars.
Justin Riley, who began driving for Lyft a month ago, said he enjoyed the flexible hours, which gave him time to work on getting his tech startup company off the ground. "It's allowed me to discover LA," he said. "I've met so many diverse people, heard so many great stories."
But Drischler, the city taxicab administrator, said the collegial environment was part of the problem. Before safety partitions were installed in cabs two decades ago, he said, one cabdriver was killed every 18 months in Los Angeles. "I'm honestly worried for the drivers of those companies," he said. "I have two daughters in their 20s, and I would never let them drive for those companies."
The California Public Utilities Commission is writing rules for smartphone ride-hailing services.