Taxi companies and Uber in Asheville

Taxi companies in Asheville, subject to stricter regulations, find it difficult to compete with Uber and Lyft.

“We have taken some of the business from taxis, but taxi companies should also be enlightened that while we took some of their business, we built up on the business, our system is better,” said a part time Uber driver who did not wish to be named.  “Where people couldn’t find a taxi because of distance or time, there’s a [Uber] driver there in less than 10 minutes.”

Last September, Gov. Pat McCrory signed into law Senate Bill 541, enacting a set of regulations on “Transportation Network Companies” in North Carolina.  The bill officially requires companies such as Uber and Lyft to annually purchase a $5,000 state permit, maintain liability insurance on vehicles, and perform background checks on drivers.

Uber has covered insurance on rides as well as performed background checks on drivers since the company started operating in North Carolina, according to a press release.  The state regulations, which Uber helped write, allow the company to avoid city regulations, which in some places can be less favorable for ride sharing companies.

“The law in North Carolina says you’re exempt from all the taxi regulations if you’re Uber or Lyft, if you’re anybody else you have to comply with all this ludicrous stuff,” said Woodward McKee, the owner of Asheville Taxi Company.

What makes competing with Uber difficult for taxi companies is that while Uber can have a fluctuating number of drivers to match demand at any given time, taxi companies can have only a set number of vehicles in their fleet, said McKee.

Taxi companies have enormous costs that Uber does not, instead of having to repair and maintain a fleet of vehicles, Uber diverts the task and expense to it’s drivers.  Having such low operational costs allows the company to charge passengers much less for rides than competing cab companies.

“They [Uber] don’t have to worry about the driver, whether he’s making money or not — the drivers are the ones getting the short end of the stick,” said McKee.

Even if McKee had an approved app, paid for background checks and the $5,000 state licensing fee, found drivers willing to use their own cars and work essentially on-call, there is no way for him to insure those rides.  

Uber insures its rides by using a specialty insurance company called James River which provides a custom tailored plan to meet Uber’s needs.  This type of insurance plan is very much out of reach for small cab companies.

“It’s essentially on total lock down right now, there’s no way to compete with Uber.  Everybody else is just fighting for whatever’s left,” said McKee.