Amid fight with Uber, Lyft, Boston taxi ridership plummets
Boston taxi ridership dropped 22 percent in the first half of this year, a massive decline that provides the strongest evidence yet to support the local taxi industry’s complaint that its business is being eroded by upstart competitors Uber and Lyft.
From January to June, taxis in Boston reported some 1.5 million fewer passenger trips and took $33 million less in fares — a cut of 25 percent — compared with the same period last year, according to data collected by city regulators. The total number of trips fell to 5.3 million.
The steep falloff in revenue has increased the sense of urgency for taxi businesses, which say the expenses and regulations they face make it impossible to compete with ride-hailing companies, which allow riders to summon and track cars on a smartphone app but face fewer regulations than do traditional cabs.
The numbers came as no surprise to Boston taxi drivers. At the cabstand outside South Station, on Atlantic Avenue, they witness the new reality every day: The business travelers and tourists who once queued up at the stand instead bound into the back of unmarked Uber vehicles double-parked alongside them.
“Is business down?” Nasreldin Ibrahim, a 17-year veteran driver, asked incredulously on Wednesday. “Look for yourself.”
He pulled a slim stack of receipts from a small duct-tape pouch and spread them across the hood of his idling cab — records of his fares in recent days. He pays $500 a week to lease the vehicle, a fee that includes a medallion giving him the right to pick up street hails. But during an 11-hour shift Monday, he said, he had just five fares and made around $70 — almost exactly what it costs him just to lease the cab each day. And that’s without the expense of maintenance and gas.
“What’s left for my pocket? Nothing,” Ibrahim said. “Everybody’s hurting.”
Uber arrived in Boston in 2011 and Lyft came in 2013, but it took several years for the companies to have a real effect on the taxi industry here. In the first half of 2013, fare revenues were less than 1 percent lower than the same time a year earlier. They fell another 2 percent in the first half of 2014, according to data from the Boston Police Department, which regulates taxis.
The revenues have gone up and down for the last couple of years. For the full year of 2013, revenues actually grew 2 percent but dropped 6 percent in 2014.
“My surprise is that it’s not more of a plummet,” said Donna Blythe-Shaw, who leads an advocacy group of Boston taxi drivers. “The taxi industry isn’t going to survive without any kind of reform or regulations on Uber.”
Heavy snows in January and February didn’t seem to have much of an effect on taxi revenues. The drop-off during those months was only slightly worse than in the spring. If anything, drivers said, the snow-clogged sidewalks and storm-related breakdown of MBTA lines pushed more commuters into cabs.
“Oh, it’s Uber, not the snow,” said Daniel Ali, 52, who has been driving a Boston cab since 2003 but is considering quitting. “You see Ubers coming all the time, and we are just watching.”
Ali said he used to clear $700 to $800 in profit each week before Uber’s debut here. But now, he said, he’s lucky to make $200. The owner of the medallion on his cab has refused to discount the price Ali pays to use it, he said, citing bills of his own.
Data in other cities have shown a similar decline in taxi ridership.
San Francisco transit regulators said last September that in 15 months, taxi use had fallen by nearly two-thirds in the city, where Uber is based. Yellow taxi ridership in New York City dropped 10 percent in the first half of this year, according to an analysis by the New York Daily News.
Some 10,000 drivers have signed on with Uber in Greater Boston, according to the company. That’s on top of an unknown number of people who drive for Lyft, which would not disclose its numbers.
But lawmakers still haven’t decided how to regulate those companies. Governor Charlie Baker has proposed legislation that would require state background checks but otherwise allow ride-hailing companies to operate much as they do today. The taxi industry is backing a stricter law that would impose pricey regulations more closely mirroring those that govern the taxi and livery industry.
Hearings on the ride-hailing laws are scheduled for next month. In the meantime, said Stephen Regan, a spokesman for the Massachusetts Regional Taxi Advocacy Group, taxi revenues continue to shrink while ride-hailing companies have gotten a free pass on licensing laws.
“Regulators and mayors have set the law aside,” Regan said. “They should be enforcing the laws that are on the books, and if they were doing so, we would not have this situation.”
In the past, Uber and Lyft have said they fill a niche that taxi companies don’t, providing affordable rides to people who previously wouldn’t take a cab and serving outlying areas, including the far reaches of Boston and the outer boroughs of New York City, much better than taxis do.
Lyft didn’t reply to a request for comment, but Uber said in a statement that the Boston data show many consumers prefer its service.
“At a time when the status quo has repeatedly failed consumers, Boston residents and visitors now have a convenient and reliable way to get around town, and they’ve made it clear that they value innovative transportation alternatives like Uber,” spokesman Taylor Bennett said in an e-mail.