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Taken For A Ride
Tom McNihol | Photo: Shaw Nielsen | September 16, 2013
Is SFO’s recent crackdown on companies like Lyft and Sidecar merely a ploy to protect its monopoly?
In July, when news broke that SFO employees were issuing misdemeanor citations to drivers with ridesharing companies like Lyft and Uber, it looked like a simple enough story. SFO argued that the drivers didn’t have a permit to operate on airport property and were, therefore, trespassing, and the rideshare companies countered that they had a right to work wherever they wanted. But what seems at first glance like just another episode in the Summer of Cabbie Discontent may actually be something quite different—a large organization strenuously protecting a very lucrative monopoly.
Thanks to startups like uber, Lyft, instantCab, and Tickengo, getting to and from SFO is easier and cheaper than ever. But what’s good for consumers is bad news for the airport. SFO collects between $2 and $4 from medallioned cabbies for every trip out of the airport. It charges up to $36 a day for parking. And it takes a 10 percent cut of the gross profits derived by car-rental companies from airport business, as well as charging a $20-per-rental transaction fee. That all adds up to hundreds of millions of dollars every year—revenue that the airport stands to lose if rideshare companies continue to offer SFO service, often at a price that undercuts cabs.
Airport officials profess that they’re concerned with avoiding traffic snarls and defending the rights of cab companies. And the airport charges taxi fees for a legitimate reason, according to Trevor Johnson, a director of the San Francisco Cab Drivers Association: to pay for safety measures like road maintenance and ground-transportation staff. But money talks loudest, and SFO is likely protecting a lucrative revenue stream.
Even if SFO’s citizen’s-arrest ploy was a bit of a publicity stunt, one person’s monopoly is another’s organizational mandate. And if that’s what this fight is about, SFO’s citizen’s arrests aren’t a red herring at all, but an example of the core conflict of the long-roiling rideshare wars: the battle for market dominance. Summer may have officially come to an end, but the season of cabbie discontent is far from over.
Originally published in the October 2013 issue of San Francisco