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New York City votes to cap licences for Uber, Lyft vehicles

09 August 2018

New York City Council has approved legislation to cap the number of licences for ride-hailing services such as Uber and Lyft, reports Reuters. The legislation will halt new ride-hailing vehicle licences for a 12-month period but exempts wheelchair-accessible vehicles. The legislation also includes setting a minimum wage for drivers. In response to the news, an Uber spokesperson said, "The City's 12-month pause on new vehicle licenses will threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion". The aim of the legislation is to improve the city's traffic congestion and protect driver income. Lyft does not agree that the legislation will solve the problems the city is seeking to address. Joseph Okpaku, vice-president of public policy of Lyft said, "These sweeping cuts to transportation will bring New Yorkers back to an era of struggling to get a ride, particularly for communities of color and in the outer boroughs."

Significance: New York City will be the first any major US city to impose such a cap, and if it proves to address the issues, then other cities might follow suit. This will be a blow for Uber as it is the biggest ride-hailing company in the US, and is preparing to go public in 2019. The New York City Council had suggested a similar cap on ride-hailing services in 2015, but it stepped away as it did not attract enough support to pass. Since 2015, ride-hailing services have tripled in the city and have jumped from about 12,600 in 2015 to about 80,000 this year, according to the New York City Taxi and Limousine Commission.

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