Taxi Troubles

Maury Sutton, LCT Publisher
Posted on September 1, 1988

A wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and this is necessary to close the circle of our felicities.--Thomas Jefferson

We have two items in this issue dealing with regulation. Our Guest Editorial by Jeff Berger deals with regulation on the manufacturing end, and our story on page 60 discusses regulations faced by operators. Most of the rules now being proposed affect operators. Many of the proposals have come with the blessing of taxicab operators. Should the taxicab operators concern themselves with limousine activity?

Let’s take a closer look at the taxicab industry. The latest D.O.T. study we were able to obtain was issued in 1982. The average taxicab organization operated 35 vehicles, with half of the operators running less than ten vehicles. Yet, operations with 100 or more vehicles carried more than 50 percent of all passengers. Over half of the drivers were operating as independent contractors.

In 1981, the 3,000 taxicab organizations representing over 100,000 vehicles generated more revenue than all U.S. public transit systems – over$3.3 billion. This was accomplished with 165,000 cab drivers. Even today, and no matter how you measure it, the taxicab industry continues to be a major cog in the U.S. transportation network.

It is interesting to look at taxi statistics from the beginning of this decade. The report indicted, even then, that the industry was “vulnerable.” The national taxi fleet had deceased at least 50 percent over a six-year period with contracting services (e.g corporations, hospitals, dial-a-ride) becoming a major revenue source.

Change was occurring in the taxicab industry prior to the great surge in limousine operations. Limousine & Chauffeur Magazine would not arrive on the scene until 1983. There were less than 10,000 limousines operating in the U.S. at that time.

We realize that much of today’s outcry for local regulation is coming from the taxicab industry. They may fear limousines as a threat to their own livelihood, or survival for that matter; but the taxicab industry’s problems were evident long before limousines became a growth industry. Contracting out drivers and putting stringent restrictions on the issuance of medallions are just two of the maneuvers that have hampered the taxicab industry.

To understand some of the fears and frustrations of the taxicab industry only makes it easier to work together for the common good. The public and private transportation system is important to every city and town in this country. It should be regulated for the citizenry, and not to stifle or maintain an unreasonable way of doing business.

Yes, the taxicab industry should be concerned with the growth of the limousine industry. This country needs a varied and workable transportation network. Cabs and limousines should be working together as viable members of the transportation industry. One should not be regulated to the exclusion of the other. I am glad to see that the limousine associations in Massachusetts and Miami have taken this position.


Related Topics: independent contractor issues, taxis

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