Uber is making strides in its effort to increase the number of taxis on its platform with the announcement of a partnership with Los Angeles Yellow Cab and other taxi fleets in Southern California. This collaboration will provide six taxi companies operating in Los Angeles, Orange, and San Diego counties with access to trip referrals from Uber.
Initially created as a luxury car service in 2008, Uber set out to disrupt the taxi industry in the United States and has since expanded globally. Now, Uber is seeking support from the traditional taxi business as it looks to fuel its next phase of growth.
Uber had previously formed partnerships with taxi companies primarily outside of the United States. However, the company has recently made moves in the U.S., including agreements with New York City taxi companies and a collaboration with Flywheel Technologies in San Francisco.
“We’re excited to announce our partnership as we continue to strengthen our relationship with the taxi industry,” said Camiel Irving, Uber’s general manager of U.S. and Canada mobility. “We’re grateful for the support from local regulators in California and look forward to working closely with our taxi partners to expand this program to more drivers and cities across the country.”
The chief executive of the Southern California taxi operations involved in the deal, William Rouse, expressed enthusiasm for the partnership. He believes that teaming up with Uber will bring more riders to taxi drivers while providing Uber with a larger pool of drivers.
“This partnership is a huge opportunity for us,” Rouse said. “It will help us increase our night business, which has declined over the years. Ultimately, this collaboration will benefit the drivers by boosting their earnings.”
Rouse’s six taxi companies, including San Diego Yellow Cab, California Yellow Cab, Los Angeles Yellow Cab, Long Beach Yellow Cab, Fiesta Taxi Cooperative Inc., and United Checker Cab, have a combined fleet of approximately 1,200 vehicles.
In the past, Uber and the taxi industry have clashed, with Uber criticizing the industry as corrupt and greedy while taxi companies argued that Uber and other rideshare services destroyed their business model and harmed their drivers’ livelihoods. However, Rouse prefers to focus on the present and the future. He commends Uber for their professionalism and believes that the partnership has been successful thus far.
The integration of Uber and the taxi companies’ technology will occur in phases. Initially, Uber’s app will be installed on drivers’ tablets, and calls will be received through the app. Eventually, Uber will directly integrate with the taxi companies’ dispatch system.
L.A. Yellow Cab and its partner fleets, which Rouse oversees, offer rides through the digital platform RideYellow. Once taxi drivers sign up, they can expect to receive Uber trip referrals in the coming weeks.
Last year, when Uber’s San Francisco taxi pilot program launched publicly, some drivers expressed concerns about the growing presence of Uber. However, Uber presented a quarterly analysis by the San Francisco Municipal Transportation Agency that showed drivers who provided Uber trips earned an average of $1,767 per month, 23.8% more than taxi drivers who did not offer Uber trips.
While Uber is regulated at the state level, taxi companies are regulated locally. Rouse’s taxi fleets are subject to oversight by the cities in which they operate.
City officials in Los Angeles approved an ordinance last year that allows digital upgrades for taxis, improving access to taxis through smartphone apps like Uber and Lyft. This initiative provides ride-hail apps with access to city data for more efficient dispatching. Additionally, it removes limits on the number of authorized cabs, granting 10-year permits to operate. Officials will monitor the system’s performance and analyze factors such as driver wages, fleet size, wait times, and ride frequency.
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