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August 2008

It is great to be able to say that we are making tremendous progress towards the goal of a taxicab industry that’s cleaner and greener -- one that makes a truly measurable contribution to our city’s efforts to reduce its carbon footprint. Waffling is not an option when it comes to the air we breathe and the health concerns we share.  Only action will do.  That is why I am so pleased that several major automobile manufacturers have responded to the taxicab industry-specific initiatives flowing out of the Bloomberg Administration’s plan (PlanNYC) to reduce the carbon levels of the city.  Let me cite who they are: Ford Motor Company, General Motors and Nissan North America.  All three manufacturers have pledged their resources to assist in the conversion of New York City’s taxicab fleet to the clean and modern one we want it to be. They know that what they are doing is both smart as a business venture and responsible from a civic point of view - a combination that always makes sense.  Further, there is something visionary going on here: an opportunity for responsible auto companies to set the standard for taxi fleets around the world that either already have, or are seriously contemplating, following New York City’s lead in creating clean taxi fleets.

To spotlight the details of what we are aiming to accomplish, you may recall that the TLC voted unanimously last December to approve new regulations. They require that, effective October 1, 2008, all new taxicabs coming into service (except for accessible taxicabs) must be able to achieve a city mileage rating of 25 miles per gallon, and that one year later (October 1, 2009), all new taxicab vehicles much achieve a minimum city driving rating of 30 mpg. Combine these regulations and you get to our goal: nearly an all-hybrid fleet by the year 2012.  New York City today has 1,331 hybrid-electric taxicabs, just over 10 percent of the total fleet.  Now numbering 13,237, it is the largest fleet in any U.S. city, and we can now boast the largest number of hybrid taxicabs in the nation.

As for the all-important measure of performance, the news continues to impress.  During the three inspections that each taxicab is subject to annually, our hybrid-electric vehicles have performed exceptionally well.  The fact is, these vehicles have historically passed their initial inspections at the rate of 85%, compared to an average of 54% for other prevalent taxicab vehicles, and they require fewer inspections.  Still another point to consider is that the new regulations I have cited will, when fully phased in, save vehicle owners between $4,000 and $11,000 per year in gasoline costs.  Also, industry-wide savings are projected to be as much as $140 million per year.  Of course, the principal beneficiary of the hybrid taxicab’s ability to save on fuel is the person who drives it.  We have all heard and read the complaints of taxi drivers concerned by the impact of high gas prices on their overall earnings.

We should take a fair and balanced look at the situation at hand.  One drivers’ group has called for a taxi fare surcharge linked to gas prices.  Sounds simple enough.  But for most New Yorkers -- and certainly for visitors to our city – it is not the complete picture.  Some of the factors to consider include:

  • With many other transportation options in New York City, a surcharge would simply mean less people opting to using taxis, and therefore less money in the taxi industry as a whole.
  • The level of international visitors has increased again this year rising 2.3%, while the number of airport passengers is also up (now at 9.4 million). Hotel occupancy remains at high levels.
  • The TLC licenses a record number of taxicab drivers, and licensee attrition rates are at an all-time low.   
  • With new technology bringing the ease and convenience of credit card acceptance to passengers, we have data showing tips for credit card rides averaging between 19% and 20% of the total fare…..substantially more than cash tips.
  • As mentioned above, new fuel efficiency standards created by the TLC continue to result in more hybrid-electric vehicles as taxicabs, saving drivers thousands of dollars annually in fuel costs.  Drivers of such vehicles benefit from their fuel efficiency by consistently earning 2-3 dollars more per hour.
  • In 2004, the TLC granted an unprecedented 26% fare increase, the stated goal of which was a “living wage” for drivers -- a goal that not only has been met but remains surpassed, according to data provided by the electronic trip sheets generated by our new taxi technology systems.
  • In 2006, the TLC proactively doubled the metered waiting time, raising fares and increasing revenues substantially, with 100 % of this increase going exclusively to taxicab drivers for the first time.

All that having been said, the frustration drivers feel about the price of gas is a very real thing.  Since fuel cost fluctuations are entirely out of anyone’s control, it naturally gives rise to fear of the unknown.  But the simple fact is that not everyone agrees that a surcharge is a viable approach to this very complex issue.

Within a framework of fairness and industry-wide economic considerations, we must constantly evaluate the financial situation and operating requirements of our city’s taxicab drivers. An ample of amount of caring, coupled with a thoughtful dose of realism, must go into that evaluation, which in this instance resulted in my denial of the surcharge request.  In the end, every TLC action must be undertaken with a keen sense of obligation -- to taxi drivers, to the industry as a whole, and to the people who live in and visit our city.


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