Mobility Innovators

Uber finally announced its partnership with Yellow Taxis in New York, USA. The partnership between Uber and Yellow taxis is significant as there was fierce competition. However, the pandemic changed everything. As per the agreement, New York City Taxi and Limousine Commission’s licensed technology partners – Creative Mobile Technologies and Curb Mobility will integrate their taxi-hailing apps’ software with Uber’s. The two companies enable credit-card payments in taxis and run the screens that display the weather, news, and ads to riders. This will bring additional 13,600 taxis to Uber’s platform.

This is not something new as many ride-hailing companies (also TNCs) have partnered with conventional taxis operators in other cities including partnerships between Grab & SMRT Taxis in Singapore, and Careem & DTC Taxis in Dubai. There has been happening for quite some time and projected quite earlier as shown below. “First, they ignore, then they fight, then they compete, and then you collaborate and finally you integrate“.

Riders will be able to book the taxi through the Uber app from Spring. Uber will then refer the request to the two taxi technology companies, which will notify drivers to pick up the passengers. The fare will be calculated as per Uber’s pricing and policies, including surge pricing, which may increase the cost at peak times for the riders. Passengers will pay roughly the same fare for taxi trips as for UberX rides, but taxi drivers will be paid as per New York’s ride-hail wage standards.

Uber is looking to tie up with taxis as a major growth opportunity, added 122,000 taxis in 2021, and looking to add all taxis in the US by 2025. As per Uber, the US Taxi industry is worth $120 billion with 20 million active vehicles.

Uber has a similar partnership with taxis companies in other countries, including:

• 2,500 taxis in Spain
• TaxExpress in Colombia
• HK Taxi app in Hong Kong
• SK Telecom in South Korea
• Taxis in other countries – Germany, Austria, and Turkey.

Yellow taxis in New York were the most popular modes to travel around the city in 2011 and the taxi medallions license that gave them the right to pick up passengers was valued at $1 million each. Uber entered the market in 2011 and the price of taxi medallions dropped below $160,000 in 2018. The most valuable assets class became very cheap.