Revel has failed in its attempt to add a fleet of 50 EVs to launch an NYC rideshare service. While many drivers are against new fleets arising, they still want a way to own their own car

“It is not sustainable to allow an unlimited number of new vehicles on the road in a city that is all too familiar with the choke of traffic congestion…What we will not allow is the opportunity for another corporation — venture capitalists or otherwise — to flood our streets with additional cars.” – TLC Chair Aloysee Heredia Jarmoszuk 

The NYC Taxi & Limousine Commission (TLC) voted to remove the EV exemption on the FHV License Pause (aka TLC Plate Cap), which allowed drivers and fleets to still add new electric vehicles to the NYC for-hire fleet. The vote to remove the exemption passed 5-to-1. Commissioner Bill Aguado, who represents the Bronx, did not support the exemption removal, while Commissioners Lauvienska Polanco and Nora Constance Marino were not present. The 2.5 hour virtual Zoom meeting had strong voices, including environmental groups like the Sierra Club, comment during the public session.

Frank Reig, CEO & Co-Founder of Revel, said removing the exemption would, “guarantee a monopoly for the Silicon Valley ride-share giants, the status quo of gas cars and drivers without rights.”  In addition, he addressed the concerns around the prospect of Revel adding thousands of cars.

“Revel isn’t going to flood the streets with thousands of cars at once, like other operators have in the past,…In fact, we literally can’t do that. The for-hire electric fleet needs charging infrastructure, and this city has none of that.” – Frank Reig, CEO & Co-Founder of Revel

On the other hand, TLC Chair Aloysee Heredia Jarmoszuk shared an incredible statistic that 86,000 of c.96,000 of the City’s licensed for-hire vehicles haven’t completed a single trip since March 1, 2021!

“Why would the TLC license more vehicles when there are so many that are not in use right now…There is no shortage of licensed vehicles right now in New York City. The number of licensed vehicles outweighs the demands for rides by passengers. These are facts, and this is the math, and this is our reality.” – TLC Chair Aloysee Heredia Jarmoszuk 

One Driver, One Plate & Yellow Cab Medallion

During the meeting several drivers and driver advocates, some against the Revel fleet being allowed, suggested the TLC create a mechanism to allow individual drivers to add their own plate. IDG director Aziz Bah made the point that many drivers were trapped in punishing leases controlled by large fleet companies because they could no longer acquire their own for-hire vehicle license. While some of the financial math (link to AutoMarketplace article on FHV lease math) and TLC fleet statistics mentioned were misleading/incorrect, the overall point is an interesting one. In fact, during the virtual call the TLC Chair nodded her head in agreement each time the subject was brought up. Essentially, drivers who would like to own their own car/FHV license, but currently rent, argue that a new medallion system is arising via a few fleets owning thousands of for-hire vehicle licenses. It’s an interesting point.

In principle, I agree that after a certain threshold is met (i.e., number of years as a licensed TLC driver) it probably does makes sense to grant a TLC driver the option of owning his or her own FHV license. However, the issue that arises is less to do with the large corporate fleets that have arisen due to Uber and Lyft, but more to do with protecting the value of the the NYC Yellow Cab Medallion. Medallions have fallen over 90% from all-time highs of c.$1 million and are rumored to be trading in private markets at c.$100,000 at this point (I personally have spoken to someone who claims to have acquired a Medallion at $75,000 during the depths of the pandemic!). There is also a well publicized government-funded Medallion relief proposal that is being fought over as the industry continues to recover. Although the Yellow Cab Medallion still gives the sole right to “hand hailing” in NYC, the market share of “hand hail” vs. “e-hail” has collapsed and represents less than 20% of total trip market share as consumer habits have permanently changed. If a “one driver, one plate” policy is allowed, Medallion values would collapse below $50,000 in my opinion as their only value at that point would relate to “hand hailing” rights.

I believe the next great debate in the TLC community will relate to the concept of each driver having the ability to own their own plate after they’ve reached certain criteria (i.e., years as a TLC licensed driver or trips completed). For example, in London they effectively have a “one driver, one license” rule, but only after a driver passes a very difficult test called “The Knowledge”, which takes years to prepare for. Another solution would be to institute “lease caps” to ensure large fleets don’t take unfair advantage of their for-hire vehicle licenses. There are many potential solutions and as time goes on I expect there to be more focus and media around this subject.

What do you think?