(Updated at 5:55 p.m.) Nearly a hundred Arlington (Va.) taxi drivers crowded into the County Board offices Thursday afternoon, asking county policymakers to take action against UberX.
UberX, which launched in D.C. last summer, is a smartphone app that connects users with drivers who use their personal vehicles to give on-demand rides. It presents itself as a “better, faster, cheaper” alternative to taxis.
But in Arlington, taxi drivers and companies are becoming more vocal in their criticism of UberX. They say it’s unregulated, dangerous and illegal. That, and it’s hurting their bottom line.
Red Top Cab, the largest taxi company in Arlington, told ARLnow.com that the number of trips it dispatches is down 5-10 percent compared to 2012 — a drop that it attributes in part to UberX and similar services, like Lyft. Drivers told us there are other signs that UberX is siphoning off riders: full taxi stand lines and some drivers defecting to Uber.
“They’re trying to put people like us out of business,” said Charlie King, Vice President of Red Top, which just celebrated its 50th anniversary. “We don’t have $300 million of Google’s money to play with, so it’s a bit difficult to compete. We do everything we can to keep rates for our drivers as low as we can given the cost structures dictated by regulatory requirements.”
(Uber has raised more than $300 million in venture capital, part of which came from Google Ventures.)
Drivers bear the brunt of the impact from increased competition. They pay Red Top and other cab companies a flat fee that covers the vehicle, maintenance, insurance and dispatch service — a fee that they say keeps rising. Meanwhile, with fewer riders to pick up, nearly every driver at the County Board office Thursday raised their hands to say that they’ve been working longer hours and making less money since the launch of UberX. Many said they work 7 days a week.
“UberX is a cancer,” said Daniel Berhane, an Alexandria cab driver who came to support Thursday’s protest, which was organized in part by the group Virginia New Majority. Berhane said he was working 10 hours a day before UberX. Now he’s working 12-14 hours a day and “even that’s not enough.”
“People are preferring UberX because the fare is lower,” said Syed Omar, an Arlington cab driver. “Passengers are telling us they’re taking it.”
“There’s less and less business,” said another driver, who complained about the loitering tickets drivers have been getting from police. “Taxi stands are full. We’re just driving around.”
Drivers and cab companies alike say UberX competes on an uneven playing field and should be subject to the same rules and regulations as the taxi industry. That would include requirements like obtaining taxi permits, taking police background checks, carrying commercial auto insurance, and charging flat, regulated fares. UberX, said Red Top’s King, is “unregulated and frankly an illegally operating entity… that’s doing its best to undercut the market.”
(Uber’s app can also be used to request pricier rides from “black car” livery service drivers, who are subject to more regulation than UberX drivers. Cab companies and drivers said they’re primarily concerned about the low-cost UberX and Lyft services.)
UberX drivers carry personal auto insurance and the company has a supplemental corporate policy, but regulators in Minneapolis, who are grappling with the same complaints from taxi companies, said this week that the UberX’s policy has “unacceptable” gaps in coverage. UberX recently began charging customers a $1 per ride “Safe Rides Fee” to pay for better background checks and car inspections, but an TV station’s investigation in Chicago last week found UberX’s background checks lacking.
As for fees, UberX charges higher fares — three-fold higher than normal in some cases — during times of peak demand. Taxi drivers say that customers come flocking to cabs when UberX fees go up. Uber says the higher fare help ensure that those who want a ride can get one, but Red Top officials said such practices hurt those who can least afford it.
“You have to ask yourself a question,” said Red Top Chief Operating Officer Jack Weiner, “is it okay that this is only available to those affluent enough to afford it?” Weiner also pointed out that local cab companies provide wheelchair-accessible taxis for the elderly and disabled, something he contends UberX is not interested in doing.
Arlington County officials on Thursday told cab drivers that their hands were tied when it comes to regulating UberX. Because Virginia is a Dillon Rule state, Arlington is waiting for the state to give localities the authority to regulate such services. No timeline was given for the state’s review of UberX.
“We need to see if we can get that authority,” said Walter Tejada, the only County Board member on hand to address the hastily-planned gathering. Tejada said there are “a lot of unknowns” when it comes to UberX, but said he was sympathetic to the plight of cab drivers who are paying fees and getting background checks to comply with the county’s taxi regulations.
“We as a government need to do our part to help you out,” he said.
Many drivers left the meeting unconvinced of the county’s willingness to place restrictions on the increasingly popular UberX service or to meet their other, more long-standing demand: a driver’s bill of rights that would protect them from what they describe as unfair labor practices by cab companies.
“We’ve come here many times and we hear the same empty promises,” said one driver. Said another: ”I didn’t hear anything but lip service.”
Jon Liss, Executive Director of Virginia New Majority, said he wants the county to “regulate and get rid of UberX.” He promised more action by cab drivers — perhaps causing a traffic jam in one of Arlington’s commercial districts or driving the speed limit en masse on a local highway.
“We’re going to do something the county is going to hear… we need to create havoc in the streets,” he said. “It’s not about UberX, it’s about drivers’ rights and due process.”
One protester said that drivers should do a better job educating the public about the issue.
“People in Arlington County need to know what’s going on and what we’re suffering,” he said, “because that’s who’s using UberX.”
Uber did not respond to a request for comment, but an UberX driver who talked to ARLnow.com said the service is succeeding because it’s better for customers.
“I used to use cabs all the time, and Uber is better customer service,” said Nadir, who picked up an ARLnow.com reporter in his Honda Accord and declined to give last name. “It’s business, it’s competition. From my experience, people love Uber because it’s safe. You know your driver, you can see his picture and his car before he arrives, you can use your credit card. I’d say 98 percent of my customers are happy with it. Taxi drivers shouldn’t get mad, they should get better. We’re better than cabs right now.”
“Cabs charge you extra for extra people, they charge you extra for luggage even if they’re picking you up from the airport,” he added. “I keep water in my car and have chargers for iPhones and Samsung phones.”
In an effort to keep up with Uber and technology changes, Red Top partnered with the Taxi Magic smartphone app in 2009 and launched its own app in February 2013. The two apps “took off like a rocket” and now account for 36,000 taxi dispatches a month — about 25 percent of monthly ridership — according to company officials. That number continues to grow.
“We’re happy to compete against their app,” said King. “We’re less happy to compete against their questionable business practices.”
Despite the competition, Red Top managers say the company is “here to stay.”
“We’re going to give people the same convenience that Uber provides, but we’re going to operate within the safeguards provided by regulation,” said Red Top Marketing Director Von Pelot.
Disclosure: Red Top Cab is an ARLnow.com advertiser