Emerging Advocacy Issues for the Taxi Industry - …...Alternative Airport Taxi Dispatch Models ´...
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Trends in Access to Airports - Emerging Advocacy Issues for the Taxi Industry By Ray A. Mundy, Ph.D. Executive Director Airport Ground Transportation Association Barriger Endowed Transportation Professor, UMSL [email protected]
Transcript of Emerging Advocacy Issues for the Taxi Industry - …...Alternative Airport Taxi Dispatch Models ´...
Trends in Access to Airports -Emerging Advocacy Issues for the Taxi Industry
By
Ray A. Mundy, Ph.D.Executive Director Airport Ground Transportation Association Barriger Endowed Transportation Professor, UMSL
Agenda• Introduction• Airports are Different• Airport Taxi Dispatch Models – Through the Years
• Open Airport• Limited Entry
• LAX Taxi Dispatch & Curb Management• The North American Experience with TNCs
• Driver Representative Issues• Implications for Australian Taxis• Summary
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Airports Are Different
´ Not public streets (North America)´ Owned and maintained by airport ´ Limited curb space´ Requirement for taxi service at all times´ Airports need to be self-supporting´ Issues with oversupply
´ Long wait times´ Independent contractor status
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The Early Years´ 1950’s
´ Single taxi co. operating rights to airport´ Taxi co.'s often guarantee passengers or MAGs
´ 1960’s – 1990’s´Deregulation of taxi companies´ Independent contractors
´New entries – non dispatched´Asset Light taxi companies
´Oversupply at airports
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The Early Years
´ 1950’s´ Single taxi co operating rights to airport´ Taxi cos often guarantee passengers
´ 1960’s – 1990’s´Deregulation of taxi companies´ Independent contractors
´New entries – non-dispatched´Asset light taxi companies
´Oversupply at airports
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Creating Service Value with Taxi Permits
Dr. Paul Dempsey, in summarizing the empirical data from these researchers' studies and other commissioned studies[1], listed the results of taxi deregulation in 21 major US cities prior to 1983.
These were:1. A significant increase in new entry2. A decline in operational efficiency and productivity3. An increase in highway congestion, energy consumption
and environmental pollution4. An increase in rates5. A decline in driver income6. A deterioration in service 7. Little or on improvement in administrative costs.[2][1] Dempsey, Paul Stephen, " Taxi Industry Regulation, Deregulation & Regulation: The Paradox of Market Failure" Transportation Law Journal, University of Austin, College of Law, Austin, Texas, Volume 24, #1, Summer 1996, p.102[2] Dempsey, Op. Lite, p. 102
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Continuum of Taxicab Firm Orientation
Taxi Company
Orientation
Individual Driver Orientation
#1 Total Taxi Firm
#2 Taxi Firm/ Vehicle Lessor
#3 Permit and Vehicle / Only Lessor
#5 Permit Only Lessor
#4 Permit Owner / Operator Independent
TTLF
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The Intervening Years
´ 1990’s – 2000´Airport becomes “regulator”
´Permitting, inspections, rules´Construction of facilities (clubhouses)´Continually poor services´Advent of “minimum/maximum fares”
´Airport administration “frustration”
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Average Daily On-Demand Airport Trips per Driver
0
50
100
150
200
250
300
0 to 1 1 to 2 2 to 3 3 to 4 4 to 5 5 to 6
Number of Trips
Num
ber o
f Driv
ers
0%
20%
40%
60%
80%
100%
120%
Number of Trips Cumulative %
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Service Complaints
´Airport taxi service: Why so poor?´Lack of taxis at peak or holiday times´Taking the “long way” to downtown´Excessive baggage & other charges´Arguments with curb side dispatchers´Dirty cars´Older, polluting fleets´Rainbow coalition of vehicle types/colors
´Harsh reality of why it is this way…´“It’s because we designed it that way!”
´Movement away from open systems
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Alternative Airport Taxi Dispatch Models
´ Open Airport´ Every city-permitted taxi (open city)´Waits of 2,3,4 or more hours´Drivers demand better conditions´Miami & DFW International Airport Examples
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Miami International Airport12
DFW Open Taxi System
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Airport Gate Fees
´ Difficult to compare´Fees range from 50 cents to $5´Open airports extremely costly to manage
´Miami’s ground trans. staff = > 150´D/FW’s ground personnel = 80´Most open airports lose $ on taxis
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Shared Entry
´ On demand taxis only´Not an exclusive for all taxi services´Prearranged always have access
´As a rule….´ Examples:
´John Wayne Airport´Tampa Int’l Airport´Sea-Tac Intl’ Airport´Dulles Int’l Airport
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Limited Access
´ LAX Example:´All city taxis participate´ Taxis are permitted only 1 day in 5´One of the busiest airports for taxis
´Often 6,000 to 7,000 taxi trips per day´A model process for large open entry airports
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LAX Taxi Dispatch
Taxis experience a 20 minute wait time in holding lot!
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LAX Taxi Dispatch
Driver has trip record, Copy is provided to passenger
Taxi dispatch companyProvides curb assistanceFor smooth passenger service
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LAX Taxi Dispatch19
Two Single Taxi Concessionaire Examples
´ RDU Airport´ South West Florida International Airport
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RDU Int’l Airport17 different cab companies provided service at a cost to RDU of > $500,000 per year to manage
To a single concessionaire company which now pays 5% of revenue & assumes all dispatch costs
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RDU Airport Taxis22
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Vehicles
Ø Non-domedØ Luxury sedan or van-style serviceØ Average age of no greater than 4 years
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Prior to TNCs --------Summary
´Changing taxi company configurations ´Deregulation/fragmentation of taxi companies´Use of independent contractors – loss of control´Use of owner – operator´Asset light taxi companies
´Vastly oversupplied airport taxi markets´Created need for airport taxi regulations
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Prior to TNCs --------Summary
´Airports moving to´Limited access´Exclusive concessionaires
´Politically difficult but´Driven by service concerns´Driven by financial situation´Just plain tired of hearing all the complaints
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North American Airports and TNCs´ Uber Black already permitted due to use of legally registered limousines´ State Acts remove TNCs from local regulatory control
´ Rideshare company/gig economy
´ Technology/Platform company
´ Enormous consumer acceptance creating a social movement´ Airports given “carve outs” in State Acts to manage their curbs and charge
Fees´ Today, Some 35 North American airports (out of our top 100) permit Uber X
´ Most are on a trial basis
´ Many were “encouraged” to admit TNCs through political pressures´ Many are finding financial impact not what they anticipated
´ Existing concessionaires are requesting lowering of MAGs & other measures
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Uber lobbyist Activity30
Impacts on North American Airports´ At first– fines and impoundment but then excitement over new
revenues due to higher gate fees charged to taxis after state bills passed
´ After six months of Uber X permit trials:´ TNC service has been highly successful with airport customers
´ Outbound airport taxi volume not dropped as expected at some California airports but…´Other airport taxi systems report losses of between 10 and 30 percent of trips
´ Shared Ride Shuttle vans experiencing the greatest losses of 30% or more
´ Airports are having some second thoughts about TNCs and financial impacts´ Taxi type trips are a “derived” demand – no new trips, just substitution
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Washington/Dulles Int’l Airport
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Washington/Dulles Int’l Airport
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Airports Receive 10% of Auto Rental Contracts and More for Transfers
Washington/Dulles Int’l Airport
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Washington Dulles Int’l Airport
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U.S. Airport Taxi Driver Quotes
“When you quit making money, it’s time to go. Find something else to do.” said Buggs, who added he has increased driving time from 10 hours a day to 16 to offset his losses (Pittsburgh, Pa. Yellow Taxi Driver
“Before Uber, we used to wait one hour at the airport to pick up passengers, which was normal, but now we have to wait three hours to get a customer,” Soltani said in frustration. (Chicago Airport Taxi Driver)
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Lessons from North American Airports for Australian Taxi Interests
´ Go Slow – Very Slow – Each country will be different´ Understand, the taxi industry has never had this type of political
deregulation for open entry under conditions of extremely lower operating costs through venture capital funds´ Uber willing to spend billions to gain market share and dominance
´ Major lawsuits abound´ Independent contractor (partner) drivers vs. employees´ Illegal use of personal auto insurance and auto loans/leases´ Safety of passengers due to substandard vetting of drivers ´ Surge (gouge) pricing model
´ We are in a 9 inning ball game that is only half played´ Expect competitors to enter market and existing taxi companies to
respond or cease to exist
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Lessons from North American Airports for Australian Taxi Interests
§ Remember Napster?o We all downloaded “free” music for a while o U.S. Supreme Court eventually held artists have property rights and ruled it
to be illegal
o However, due to the technology, it forever changed the way we obtain music
§ Technology will change the taxi industry – it already has!o Credit card acceptance and smart phone payment
o Electronic identification of car and drivero Instant customer evaluation of experience, car and driver
o Use of personal automobile and no meter
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Lessons from North American Airports for Australian Taxi Interests
´ Venture capital money eventually dries up´Burn rate keeps Uber and Lyft going back to investment
markets
´Current litigation and lack of audited financials make an IPO questionable
´ True cost of TNCs will move closer to traditional taxis (without medallion) values
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Lessons from North American Airports for Australian Taxi Interests
´ Fight Vigorously any Attempts by TNCs to lessen passenger safety costs through:´ Lack of individual vehicle commercial vehicle insurance and
plates´Stress the lack of any insurance when TNCs offer “personals”
to their customers ´ Non biometric (fingerprint) checks ´ Improper classification of partner drivers as independent
contractors´ Lies and damned lies….
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Questions ???
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www.ycstrans.com/4-things-about-uber-you-wish-you-never-knew/
Taxis, TNCs and Deregulation: Is History Repeating Itself Who's Driving You?
