NEW YORK (Reuters) – Uber Applied sciences Inc sued New York Metropolis on Friday, searching for to void a brand new rule limiting how a lot time its drivers can spend cruising streets in busy areas of Manhattan with out passengers, saying it threatens to undermine the corporate’s ride-sharing mannequin.
FILE PHOTO: A display shows the corporate brand for Uber Applied sciences Inc on the day of its IPO on the New York Inventory Change (NYSE) in New York, U.S., Might 10, 2019. REUTERS/Brendan McDermid/File Picture
In a submitting in New York state court docket in Manhattan, Uber additionally sought to void a rule banning the issuance of recent licenses to for-hire autos by August 2020.
Seth Stein, a spokesman for Mayor Invoice de Blasio, defended the rulemaking by town’s Taxi and Limousine Fee, saying it will defend New Yorkers “towards an organization that seeks to place revenue first.”
“Extending the cap on the issuance of recent (for-hire) automobile licenses for a minimum of the subsequent 12 months in tandem with the cap on cruising isn’t solely authorized, it’s going to convey wanted aid to congested streets and hardworking drivers,” Stein mentioned.
Uber, which relies in San Francisco, has drawn criticism from many cities that its autos improve congestion and take away enterprise from taxi and different providers.
In New York Metropolis, the worth of “medallions,” or licenses, wanted to function taxis has plunged lately as ride-sharing providers reminiscent of Uber and Lyft gained recognition.
Uber is difficult town’s “cruising cap” rule that units a 31% restrict on how a lot time drivers of app-based autos might drive with out passengers in Manhattan south of 96th Road -meaning they must have fares a minimum of 69% of driving time.
New York’s cruising charge was 41% in 2018. Underneath the brand new rule, the utmost would fall to 36% in February 2020 and 31% six months later.
“The rule would threaten the viability of the ride-sharing mannequin because it presently exists, jeopardizing the advantages this mannequin has created for riders and drivers,” Uber mentioned. It mentioned that whereas it has “publicly and vocally supported” lowering congestion in Manhattan, the cruising cap was primarily based on “flawed and arbitrary” economics.
Supporters say cruising and licensing caps might assist ease visitors tie-ups and release streets for cyclists, pedestrians and public transit.
Uber shares closed down $1.22, or three.6%, at $32.60.
The case is ZEHN-NY LLC et al v New York Metropolis Taxi and Limousine Fee et al, New York State Supreme Court docket, New York County.
Reporting by Jonathan Stempel in New York; Further reporting by Tina Bellon in New York; Enhancing by Chris Reese and Leslie Adler