As 2022 was coming to an end, I reached out to a number of industry veterans to get their assessments of the past 12 months, along with predictions for the coming year. Overall, I was told things got markedly better in 2022, compared to 2021 – and all of them seemed cautiously optimistic. But they also shared common, ongoing concerns for 2023.
Having been in this industry for several decades, I was not surprised that some of the people I interviewed didn’t want to be quoted directly, so some of the quotes are anonymous.
Let’s start with the good news
“We saw a resurgence of business activity across the board, in the range of 70-75% compared to pre-pandemic volumes,” noted one industry veteran, who preferred anonymity. “We began to see a shift in late 2021 as more businesses resumed activity, and 2022 followed historic norms, albeit at lower levels compared to 2019.”
“Demand for our services is close to what we were doing in 2019, but we’re still struggling to find drivers to handle the work, which is very frustrating,” added Avik Kabessa, President of Carmel Car & Limo. “We have the work, we just need the drivers. I’d estimate that the livery sector alone loses more than a million trips per month because there aren’t enough drivers to accommodate the calls for service.”
“The third and fourth quarters of 2022 are when we started to really see a marked improvement over 2021,” noted another base owner who wanted to remain anonymous. “For us, the year started off slightly above 2021 numbers, but our revenue jumped exponentially almost immediately after Labor Day.”
It was somewhat reassuring to hear common threads in their muted optimism, but there were also some overlapping concerns over the biggest obstacles they saw for achieving pre-pandemic numbers. The biggest issue: Not enough drivers for traditional bases to handle the recent influx of work, thanks to the ongoing FHV license moratorium. Availability of vehicles and parts due to continuing supply chain issues and rising costs from inflation were also mentioned.
“Because of the TLC’s [FHV license] moratorium, people who decide they want to be a professional independent operator chauffeur simply can’t get a TLC license, unless it’s for an EV, and we all know the charging infrastructure is nowhere near sufficient yet for people who drive all day. To grow our revenue, we have essentially been forced to partner with other companies and farm out jobs, which adds an unnecessary degree of separation from our clients.”
In February, the city will have another opportunity to add more FHV licenses for traditional bases, who will likely see almost no benefit from the recent addition of 1,000 EV-only licenses. The city has made significant efforts to save the struggling taxi industry and is attempting to help high-volume FHV drivers earn more money to battle inflation (despite a lawsuit from Uber attempting to block it), but traditional bases in the black car and livery industries have been left out in the cold. Let’s hope they get what they need to survive the many obstacles the future will invariably bring.
“We’re not looking to hire hundreds of drivers… even 5, 10 or 20 more drivers for a base like ours would make a huge difference, as replacements for licenses that lapsed during Covid,” agreed an anonymous base owner. “It doesn’t have to be a huge number for a typical traditional base, just enough to allow for new qualified chauffeurs to earn a living. The moratorium is essentially killing the luxury IO model in NYC.”
“The TLC doesn’t seem to have any real way to measure the level of unanswered demand that happens when companies don’t have enough drivers to accommodate calls for service,” Kabessa explained. “The city seems to be trying to help everyone but the traditional FHV bases. Covid is hurting our bases twice, thanks to the city – first the initial loss of business and now, by not allowing renewals for those who lost their licenses during Covid. They need to stop pushing the EV licenses as a solution; it’s just not feasible. They need to allow people to actually recover from Covid before pushing an environmental policy that doesn’t currently make sense.”
According to David Eckstein, co-owner of Valera Global, “We rely far too heavily on ‘dirty’ energy sources like oil, gas and coal. They are poisoning everyone on the planet and causing weather-related disasters that will only increase in frequency and intensity in the coming years, due to climate change. Whether you choose to believe the overwhelming majority of scientists or not about climate change, no reasonable person can argue that pollution isn’t a serious problem – and aside from that, dirty energy sources force our nation to rely far too heavily on OPEC and bad actors around the globe, like Russia. But, in my opinion, electric vehicles are not the long-term solution. There are simply too many obstacles. People who live in apartments have no easy access to charging stations, they take too long to charge, and the distance a fully-charged EV can drive is insufficient for an industry like ours – especially when you factor in the miles lost maintaining a comfortable vehicle interior during the hottest and coldest months of the year. Instead, I think car manufacturers and the government should be working together and focusing on making the widespread use of hydrogen-powered vehicles a reality.”
Beware of Intro 501
Setting aside the broader overview of the year ahead, I want to zoom in on legislation that’s been introduced into City Council by Council Member Lincoln Restler, titled Intro 501. Though perhaps well-meaning, this “vigilante” legislation could have a huge negative impact on FHV and taxi drivers. It encourages citizens to submit photos of violators who park, stand or stop near a school in a bus lane, bike lane, cross walk, sidewalk or fire hydrant. From what I understand, the person who sends in the picture gets 25% of the proposed $175 fine.
By law, TLC drivers are allowed to expeditiously stop in bus lanes to pick up or drop off passengers, so a simple photo is insufficient and could create unnecessary hassles for people who aren’t actually breaking the law. Perhaps a video could be required, at least showing that the violator in question actually broke a law??? TLC drivers have enough to worry about without vigilantes trying to make a quick buck, sending them through the complicated maze of our legal system for no good reason… even if they are inevitably let off the hook. I urge everyone to keep an eye on this bill, and when the opportunity arises to testify at a public hearing, industry leaders and those affected need to make sure their concerns are heard.
Congratulations Once Again, Ira Goldstein
On a final note, we would like to congratulate Ira Goldstein, executive director of the New York Black Car Fund, for his latest award from City & State. Mr. Goldstein was honored on December 15, as one of “New York’s 100 most outstanding corporate citizens.” According to City & State, the awards are handed out to an “elite group of NY’s most powerful executives, thought leaders, visionaries and influencers, who are setting new standards of excellence, dedication and leadership in improving their communities and making transformative change.”
Best wishes to all for a Happy, Healthy and Prosperous 2023!