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Uber pushes back against Bill de Blasio

The car-hailing app launches vicious PR campaign against NYC's mayor as he moves to cap number of new Uber drivers in the city

Uber app

via Getty Images

Uber, the car hailing service app, launched an aggressive campaign pushing back against New York City Mayor Bill de Blasio’s attempt to curb the company’s expansion in the city.

The mayor wants City Council to pass two bills introduced last month that would cap the number of new licenses given to black and livery for-hire cars while the city conducts a study to measure the impact of the industry on traffic, air quality, noise and public health.

City Council is expected to vote on the two measures this Thursday.

Last week Uber enabled a “de Blasio” feature in its app available only to its NYC customers, where riders could catch a glimpse of what the service “will look like in NYC if Mayor de Blasio’s Uber cap bill passes,” by displaying a “No cars available” message when riders searched for a nearby car.

Uber app "de Blasio" feature

Via Uber

Uber also launched an aggressive ad campaign titled “Don’t let Mayor de Blasio strand New Yorkers,” accusing de Blasio of “pushing the agenda of his big taxi donors.”

YouTube Preview Image

According to the New York Post, the taxi industry has “pumped more than $600,000 into de Blasio-controlled committees since January 2013.”

In an open letter to the Mayor, Josh Mohrer, Uber’s general manager for New York City, invited the mayor to debate the issue face-to-face and to have it live streamed “so all New Yorkers can watch.”

De Blasio declined the offer during a Monday morning press conference.

“I do not debate with heads of private companies over their own self-interest,” the mayor said. “Uber is a multi-billion dollar corporation, and they’re acting like one.” NYC Uber drivers staged protests in front of City Hall against the new measure. David Plouffe, Uber’s chief adviser, issued a statement saying that the mayor’s cap would cost jobs, raise the service’s prices, and strand New York riders.   “Mayor de Blasio’s plan to stop Uber will cost 10,000 jobs, hurt undeserved areas and make wait times for Uber cars skyrocket,” Mr. Plouffe said. “With this view, New York City riders can see for themselves how much time this political payback to big taxi owners will cost them.”

Uber's NYC General Manager Josh Mohrer

Uber’s NYC General Manager Josh Mohrer addressing Uber drivers in protest at City Hall. Photo by Louis Lanzano for the New York Daily News

The outrage of the mayor’s “crusade” against Uber has spread on Twitter (more on Wired.com).

Lyft, a competing service with lower market share, shared with TechCrunch its testimony to City Council explaining how the measure would be much more detrimental to smaller competitors than to Uber if passed.

“Here’s why the Council’s proposal would preserve and extend Uber’s grip on the market,” Lyft’s Public Policy Manager Diana Dellamere said.  “While Uber maintains a 90% market share, Lyft’s current market share is approximately 7%.”

The Response

According to amNewYork, Deputy Mayor Anthony Shorris said that Uber is spending millions on a misleading political campaign.

“There are serious questions about how Uber treats its customers, its workers, and whether it is flooding New York City’s already heavily-crowded streets with thousands of more vehicles,” he wrote in a reply email to Uber users.”

On Saturday, the New York Daily News published an OP-ED written by the Mayor where he explained that the city adds 2,000 new for-hire vehicles every month, a rate that must be capped to avoid major congestion in the busiest parts of the city.

“For perspective, that means we’re facing the addition of over 25,000 cars to our streets over the next year — the rough equivalent of two times the total number of yellow taxis in all of New York City,” the Mayor wrote. “We want a data-driven approach, guided by detailed study, so we can develop a comprehensive, long-term strategy for a thriving, sustainable and innovative for-hire car market.”

But according to the New York Times, Uber’s politically seasoned adviser David Plouffe, who is the former campaign manager for President Obama, is not buying the mayor’s congestion excuse.

“I didn’t just fall off the turnip truck,” Mr. Plouffe said. “I think this is less about traffic congestion than it is about political contributions.”

The Verdict

Joe Scarborough may have a point that if riders are happier and safer with the service, why spoil the free-market dynamics with political maneuvers?

If I recall correctly from economics class, then it should hold that if supply of Uber cars goes down and demand continues to go up as it has, then the price of each Uber ride will go up–especially during rush hour, when Uber’s infamous “surge pricing” take effect.

This may price a lot of people out of Uber’s market and act as the invisible hand that discourages new drivers from entering the market as the number of riders dwindle naturally.

The mayor also has a point.  Traffic in the city is already a nightmare and adding 25,000 cars to its streets in the next year alone may actually result in terrible congestion, environmental harm, and longer commutes for New Yorkers, which ironically, will also result in higher fares.

But the mayor’s move seems entirely politically motivated considering his political donor ties and the fact that he does not have the “data” on the industry’s impact on congestion, information he says he needs to take a “data-driven” approach on the matter.

De Blasio’s eagerness to halt Uber’s expansion in the city without the data to back his position is a clear sign that he has not weighed his decision carefully. And capping the number of licenses for new for-hire drivers will hamper job creation and piss off a lot of New Yorkers.

And he should know by now that is never a good idea.

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