For decades, Transportation services (Taxis, Limousine, Paratransit, Transit Agencies, etc.) each had their distinct role and place in both the private and public arena.
Now, with the entry of TNC’s (transportation network companies) like Uber and Lyft…there has been a recent and significant disruption especially for the regulated for-hire taxi industry.
The TNC’s are not subject to many of the insurance, vehicle safety, fleet ownership and other compliance regulations imposed on taxi and mobility services that layer in additional operational overhead reflected in higher costs to riders.
With TNC’s built on the backbone of technology and comparatively unregulated, the TNC’s not only are consuming Taxi market share with unprecedented growth, but also posing a series of challenges to transportation and regulatory policy makers addressing areas of concern for:
- Customer service protections
- Public safety requirements covering drivers and vehicles
- Monitored and regulated services at the state, regional, or local level
- Evaluations of safety requirements
- Disparity of access for people with various disabilities
- Alternative employment classifications for TNC and taxi drivers
However, many of these concerns will have to be a battle of political will against the TNC championed free market economy looking to keep regulations at bay and costs low.
Many Transit agencies are becoming early adopters of TNC integration into their service options as it provides reduced expense to their riders. Other agencies are more comfortable with the insurance requirements for taxis which are set by local jurisdictions requiring commercial policies.
In fact, to date, 27 states have adopted laws that are based on the precedent-setting insurance requirements adopted earlier in California that close the gap between coverage applying to taxi drivers and to TNC drivers while engaged in a commercial activity.
TNC’s currently only focus on the economic and convenience advantage they provide and have created the demand for. However, they are not addressing the specialized transportation needs of an increasing disabled and elderly market opportunity with the advancing in age of the baby boomer generation.
We’re even seeing Transit Agencies such as METRO in Washington D.C. encouraging its passengers with disabilities to use taxis instead of paratransit vans. This again is driven by cost as riders benefit because they pay cheaper fares than for paratransit, ride by themselves and can order a trip in less than an hour in advance, rather than the day before.
Clearly technology has brought with it improved access, scheduling convenience and lower costs allowing penetration into other transportation markets, but it still doesn’t fully address the capability of drivers and vehicles to accommodate the needs of a paratransit passenger.
So, while the industry waits on legislation to level the playing field with TNC’s, it opens up an opportunity to the Taxi companies to take advantage of the need for quality paratransit transportation, while simultaneously embracing the efficiencies of technological advances as well as partnering with fellow regulated Transit Agencies.
As a leading transportation management and software company providing solutions to transit agencies, taxi companies, fleet providers and major airports nationally, MJM Innovations serves to ensure you have the ability to help level the playing field.