Taxi Owners Eye 19 Percent Fare Increase
NEW YORK (CBS 2 / 1010 WINS / WCBS 880) -- It's been a rough year for commuters.
First came word of bus and subway fares climbing, then bridges and tunnels; now the cost of a cab ride could be going up, reports CBS 2's Marcia Kramer.
There's one man, though, who will pocket more than most. He's the taxi king of New York City, and you won't believe the size of his fleet.
Gene Freidman has never driven a taxi in his life, but to say he wants the proposed fare hike to go through is an understatement – he owns 850 of them.
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"Talking to passengers, I feel a little bit like [President] Obama at his press conference yesterday, making excuses for the shellacking," Freidman said.
That was Freidman's response when asked to explain to taxi riders why they should pay another 19 percent every time they hail a cab in New York City. That 19 percent can mean a lot in this tough economy.
"It's never a good time," Freidman said. "Taxis are a very easy target."
Freidman owns 850 taxis. He said he's the largest fleet owner in the city, and as he walks around one of this garages in his spiffy, designer suit, he argues the need for more money on two fronts. Freidman said the drivers need a raise, and so does he, even though published reports say his revenues have exploded from $2.5 million in 1996 – when he owned 60 cabs – to $120 million in 2008.
"I'm not going to put it all on the taxi drivers, the hardworking taxi drivers who need an increase," Freidman said. "The fleet owners also need an increase to divert some of the cost, increasing costs, and the improvements we've made in the last couple of years.
Freidman can make more money from his cabs than individual owners who have just one vehicle, because he can run them 24/7 almost 365 days a year.
Still, most passengers just don't think a fare hike is justified right now, just one year after a $0.50 increase went into effect to help the MTA.
"I think they're already very high," Oradell, NJ resident Ellen Parish said. "I think that's kind of extreme."
"Supply and demand – if they raise taxi fares too high, people will stop using them, so they'll have to lower them," Burt Esrig, of the Upper West Side, said.
"You start raising the rates like that, I think you're going to upset a lot of people," taxi rider John Gallagher told CBS 2's John Metaxas.
"That's awful, they should not be doing that," student Marina Barraj said. "It's already too expensive to begin with."
"I can't believe that they're going to raise the rates – I just think it's absurd," Joyce Conti, visiting from Rhode Island, said. "We can't even get a taxi, let alone wait half an hour and then pay another 19 percent. Something's wrong with what's going on in this city."
Other fleet owners also cited the growing cost of maintaining their fleets as the reason behind the proposed hike.
"Our operating costs have continued to rise, it has been 6 1/2 years since the last lease cap adjustment and fare increase," Michael Woloz, spokesperson for the Metropolitan Taxi Cab Board of Trade, told 1010 WINS. "In order to continue to meet the needs of the riding public, get our taxis out 24/7, we need to offset our operating costs."
If the Taxi and Limousine Commission approves the proposal, a five-mile ride would go from $13 to $15.50, and that doesn't even include the tip or idling time.
"We're looking for an increase, basically, to play catch-up," Woloz said. "What we're asking for doesn't cover all of the rises and operating costs but it does, we believe, allow us to operate our businesses effectively."
The T&LC said it is reviewing the proposal. "The taxi industry has the right to petition for a fare increase, and we will evaluate that petition," Commissioner/Chairman David Yassky of the NYC Taxi and Limousine Commission said in a statement.
"We expect that nobody likes to pay more for their taxi service but the reality is that this is an unsubsidized industry and the only way to really recoup the rising costs of taxi operations is through a fare increase and a lease cap increase," Woloz said.
