Six professional taxi drivers have killed themselves in the past eight months, and many point to financial ruin as the cause.
Taxi medallions are the permits that the City issues in order to regulate the number of cabs on the road. Buy a permit, you’re set for life with a steady income and a retirement based on the increasing value of the medallion, which could be rented or sold.
Buy a medallion, and you had a chance at a middle class life in one of the outer boroughs.
In 1980, you might’ve gotten a bank loan for a medallion because it was similar to buying a house, costing something like $150,000. By 2014, those permits were worth over a million dollars. Life was good.
Enter Uber and Lyft.
Suddenly more cabs and more competition mean medallion prices tank. Ride-hailing services like Uber and Lyft, which don’t need medallions to operate, have devalued medallions by as much as 80% in four years.
Though New York City caps the number of yellow cabs at just over 13,600, it didn’t limit the number of drivers for Uber, Lyft, or other services. Uber launched in the city in 2011 with 105 cars on the road. In 2015, they had 20,000. Today, there are more than 63,000 cars providing rides through various apps, 60,000 of which are Uber.
New York city council imposed new rules aimed at slowing the number of app-cars and establishing pay rules for drivers. New York is the first major American city to take action.
Read more here from WIRED.