AUSTIN (Reuters) – The New York City Council on Wednesday agreed to cap the number of licenses for ride-hailing services such as Uber Technologies Inc for one year, dealing a blow to the companies that have relied on the largest US metro area for a major source of their revenue.
The first such cap by any major US city was part of a package of measures that also includes setting a minimum wage for drivers.
The package, opposed by major ride-hailing companies, is aimed at reducing traffic congestion and increasing driver paychecks in the wake of the explosive growth of for-hire vehicles. The drop in incomes has demoralized many drivers and the New York Taxi Workers Alliance said there have been six suicides among cab and delivery drivers in recent months.
New York Mayor Bill de Blasio said he intended to sign the bills into law, which would start the 12-month period where no new for-hire vehicle licenses would be issued, with an exception for wheelchair-accessible vehicles.
The number of ride-hailing vehicles operating in the city has jumped from about 12,600 in 2015 to about 80,000 this year, according to the New York City Taxi and Limousine Commission. About 14,000 yellow cabs operate in the city.
The effort to cap the services in New York, Uber’s largest US market, was opposed by ride-hailing businesses, including Uber, Lyft and Via.
“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,” Uber said in a statement.
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.”