New York City: Uber's latest battle ground
During a meteoric rise that now has it operating in hundreds of cities in nearly 60 countries around the globe, ride-hailing company Uber has encountered its share of opposition from regulators and the industry it's usurping. New York is no exception.
And the company known for its hubris is not engaging quietly.
"Uber is a very aggressive company -- they may not rest until they win. We'll see," Sarah Kaufman, assistant director for Technology Programming at the NYU Rudin Center for Transportation, said, referring to the company's campaign to literally fight City Hall, where a vote is expected as soon as Thursday on bills that would restrict the number of new licenses issued to for-hire vehicles.
In an op-ed piece published Saturday in the New York Daily News, New York Mayor Bill de Blasio wrote that the most congested parts of Manhattan are being overwhelmed by the addition of more than 2,000 new for-hire vehicles each month. "We're facing the addition of over 25,000 cars to our streets over the next year -- the rough equivalent of two times the total number of yellow taxis in all of New York City."
"While most businesses recognize the role of the city to set basic standards and look out for the broader public interest, Uber -- a $40 billion corporation -- is out with multi-million dollar ads trying to convince New Yorkers that it doesn't need more oversight," the mayor wrote.
Faced with measures supported by de Blasio that would curb the proliferation of for-hire vehicles in the city's five boroughs as the city studies congestion and other issues, Uber is striking back.
"The mayor is trying to cap Uber, cap Lyft, cap every service. What that means is it's a cap on jobs. It's killing over 10,000 jobs. It means poor service in underserved areas like the Bronx, like Queens. So we are going to fight this with everything we have," Uber senior advisor David Plouffe, a former aide to President Obama, told CBS This Morning on Tuesday.
Contacted by CBS MoneyWatch, Uber offered Queens resident Mohammad Hasan, who drove a yellow cab for five months and is now a full-time driver for Uber.
"I make my own schedule -- it's better for me and my family," Hasan said. "Our mayor should help people get more jobs, and Uber is giving a lot of people jobs, it's the best thing for the city."
Arguing its app-based ride service creates jobs and provides transportation in areas where mainstream cab service is sparse, the California-based company claims the bills under consideration have nothing to do with congestion concerns and everything to do with political contributions from the taxi industry to de Blasio's mayoral campaign.
"An electronic hailing system makes a huge difference in places where taxis don't travel to, so Uber fills a gap where transit doesn't exist, or is insufficient, although congestion is a legitimate issue in New York City," Kaufman said, adding that the city's bus system would benefit from future technologies that could employ "dynamic routing based on cell phone data, so that buses would know where people are going and when."
Uber would like to engage in a "a real debate about many of these issues -- from expanding our accessibility options, to providing added revenue for mass transit," Josh Mohrer, Uber's general manager in New York, wrote in an open letter to Tony Shorris, the city's first deputy mayor. "But that requires you to see beyond the interests of the taxi industry, whose proposed cap has nothing to do with the facts about congestion (or safety or workers' rights or whatever else you choose to add to the list), and everything to do with past campaign contributions."
The taxi app company also hosted a gathering of black and Latino religious and political leaders at a Harlem restaurant last week to solicit their help, arguing the bills would limit the creation of jobs in the community, with Plouffe among those on hand.
Uber is also putting its technology to use to lobby its customers, adding a "de Blasio" mode to its app. Selecting it takes the estimated wait time from a few minutes to 25, an illustration of what the company projects would be the scenario confronting users should its ability to expand be limited.
A de Blasio spokesman scoffed at Uber's contention that the mayor's actions came as political payback, noting the administration is being sued by four lenders that finance the purchase of the medallions needed to drive a yellow cab in New York for allowing Uber's growth.
"Every time this company has confronted a municipality or state that has tried to exercise some oversight, they turn to the same old playbook or tactics," Wiley Norvell, deputy press secretary for de Blasio told CBS MoneyWatch. "This is a $40 or $50 billion company trying to skirt regulation -- we're here to be sure the public is protected."
The latest feud with Uber is not the city's first, noted Norvell. "There was a battle when they first started, to license and regulate to ensure the safety of their drivers and vehicles. We are proud to have done that, but now, with the number and growth rate of drivers," the city faces additional issues, he said.
Hundreds of taxi drivers, community groups and labor leaders rallied at New York City Hall on Monday, voicing support for measures that would at least temporarily curb the number of new for-hire vehicles.
"New Yorkers want real economic development, not a predatory business model that classifies full-time employees as contractors to cheat them out of benefits," Bertha Lewis, executive director of the Black Institute, a non-profit public policy group, said.
"Clearly there is a need for a time out of some kind," Kathy Wylde of the Partnership for New York City said. "We did get a heads up that this legislation was coming down the pike, but City Hall did not threaten us," she added of a New York Post piece which quoted unnamed sources in saying Deputy Mayor Shorris had called business leaders including Wylde and threatened them to stay on the sidelines of the Uber controversy.
While New York is the current hot spot for Uber, its confrontations with regulators and the industry it is disrupting extend to other U.S. cities as well as overseas.
In recent weeks and months, Uber has been confronted with unwelcome developments on its home turf.
The California Labor Commission last month ruled a driver for the company to be an employee, not an independent contractor, and ordered it to pay restitution. And last week, a California administrative judge recommended the ride-sharing company be fined $7.3 million and gave it 30 days to come provide ride-logging information required by a 2013 law that legalized ride-hailing in the state.
Uber this month suspended its UberPop service in France after hundreds of taxi drivers demonstrated against the company in June, blocking access to major airports and train stations.
Britain is also grappling with Uber issues. "We talk to London on a weekly basis," Norvell said.
"In New York, you can't sell a single taxi medallion, but every six months, Uber adds the equivalent of all the yellow cabs already out there," Norvell said. "As innovative and tech-driven as New York City is, there are only so many vehicles you can spill onto the streets. We can quibble about what the tipping point is, but it's not infinite."