Uber filed a lawsuit against New York City, The Verge reported. The company wants to interfere with the New York City government that haunts the number of new riders. Last year, the city approved the law that stops issuing new licenses to drivers for 12 months.
There has been a multi-year battle between Uber and New York City. NYC Mayor Bill de Blasio has been in favor of new legislation to regulate riding companies for many years. And the NYC Council finally voted for such a new rule back in August 2018.
Uber has a strong stance on the new regulations. Before the poll, the company even called loyal customers to ask them to call local councilors and support Uber.
There are some reasons why politicians have been in favor of the stop. Firstly, taxi medallion holders suffered from the sudden market changes caused by Uber, Lyft and other shipping companies. The value of their licenses has fallen significantly, creating some financial problems for drivers who received a credit for obtaining those licenses.
Second, hiking services have promoted congestion throughout the city. It seems a little counterintuitive as some Uber users have given up on their personal cars to switch to Uber. But Uber also replaces many other transportation methods, such as subways, buses, bicycles, etc.
In addition to the usage pattern switch, many drivers still drive around New York City and are waiting for the next trip. The idle cars close up the streets.
Third, there are also economic reasons for this change. Uber is a marketplace that matches motorists with riders. The company takes advantage of the fact that the rules are not as strict for drivers as for taxi drivers. That way, Uber can accept a number of drivers, even if the demand doesn't necessarily match. Uber can then exploit this imbalance on the market to drive down wages.
As part of the poll, New York City has also agreed a minimum wage for driving register. Lastly, it can lead to increased price for customers. But so many customers have settled on public transport that it now generates too many infrastructure investment and traffic congestion problems.
It's a chicken-and-egg situation. You can't expect a better subway system if no one is interested in taking the subway anymore. And you can't expect customers to rely on the subway if there has not been enough investment to make it reliable.