New York City's Taxi and Limousine Commission will lift its cap on new licenses for for-hire vehicles starting Thursday, so long as they’re issued to fully electric cars.
The change, first announced in August, could allow companies including Uber, Lyft and the recent start-up Revel to deploy thousands more vehicles on city streets.
But traffic experts said it could undermine the MTA’s forthcoming congestion pricing program, which aims to reduce gridlock in Manhattan by charging motorists who drive south of 60th Street.
Traffic engineer Sam Schwartz warned it’s a “mistake to raise the cap.”
“City officials should wait for congestion pricing to be implemented before making significant changes,” he told Gothamist. “Otherwise, congestion pricing may mistakenly be blamed for worsening congestion.”
Schwartz noted his analysis found people who drive personal cars into Manhattan’s central business district travel just one or two miles, while for-hire vehicles drive 20 to 40 miles every time they enter the MTA’s planned congestion zone.
The move to lift the for-hire vehicle cap is part of Mayor Eric Adams’ effort to convert all taxis and for-hire vehicles in the city to electric or wheelchair-accessible vehicles by 2030. He’s hoping that by the end of 2024, 5% of the city’s for-hire vehicle trips will be in an electric or wheelchair-accessible vehicle.
For years, yellow taxi medallion owners urged former Mayor Bill de Blasio to impose a cap on for-hire vehicles, saying Uber and Lyft were taking their business.
City data shows the number of cars operated by e-hail companies grew from roughly 13,000 at the start of 2015 to more than 70,000 in 2018. Meanwhile, the number of yellow taxi medallions — which give cabbies the exclusive right to street hails in much of the city — remained capped at 13,500.
De Blasio imposed a cap on new for-hire vehicle licenses in 2018 but allowed new ones to be issued to wheelchair-accessible and electric vehicles. The TLC revoked the electric vehicle exemption in 2021, after Revel launched a for-hire vehicle service that ran on Teslas.
Last year, the TLC opened up 1,000 for-hire vehicle licenses for electric cars. Thursday’s change will remove the barrier entirely on new licenses for electric for-hire vehicles.
As of July, there were more than 77,000 for-hire vehicles working for e-hail companies operating in the city, data shows.
“The city's about to flood the streets with cars while the state is looking to rein in the number of cars on the streets,” said Bhairavi Desai, executive director of the New York Taxi Workers Alliance, which represents yellow-taxi medallion owners and drivers. “And both are being done at the expense of the drivers.”
Adams and TLC Commissioner David Do said during a news conference on Wednesday that the change would help create more jobs and reduce carbon emissions.
“This is how we're going to continue to accelerate our transition to a green economy,” said Adams. “And this is how we also support hard working entrepreneurs with green jobs.”
Standing alongside Adams and Do was Frank Reig, CEO of Revel, which launched as an electric moped rental company but has since expanded its New York operations to for-hire vehicles and electric charging stations. The company last year received a $7 million grant to install car-charging stations in Red Hook, Brooklyn.
“This is an accelerant for everybody so that all New Yorkers can have access to public fast-charging infrastructure, and we can electrify this entire city,” Reig said during the news conference.
