In a time of unprecedented belt-tightening, there is one industry that never stumbles—and no, it’s not foreclosure agents and short-sellers. It’s taxi service. Yes, hard-hit New Yorkers and those no longer commuting downtown to work every day are likely to scale back their yellow cab consumption, but as long as there are credit-card readers in every cab, there will be pregnant ladies, lazy tourists and over-ambitious grocery shoppers in this city, and there will be yellow cabs.
Despite the downturn, TLC medallions (those little metal plaques tacked to the hood of a yellow that allows it to pick up passengers on the street) are at an all time high. They cost, on average, $559,000 each—more than half a million fucking dollars—about the price of a house in many parts of Brooklyn. That’s almost ten thousand dollars more than they sold for in December of 2008, and more than $100,000 more than they cost in 2008. In contrast, the price of a medallion between January and December of 2007 increased by less than $13K. And that’s just for “individual” owners, who must drive a minimum of 210 nine-hour shifts a year to keep their status.
What makes this all the more interesting is that a significant fraction of the city’s more than 36,000 medallions are owned and operated by individuals or small cadres of drivers, almost all of them immigrants. For the 155 days of the year they are not required to drive their own cabs, “individual” medallion holders are free to lease their cabs for a maximum of $800 a week. During the holidays, a shift in a yellow cab leased from a brokerage (the other major player in the city’s cab market) averages $150, slipping just under the maximum allowed by law. I haven’t done the legwork to tell you what a shift averages now, but I’ll be you anything the market is keeping it high.
That’s because when times get tough, the tough get behind the wheel. While it’s true that many of New York’s immigrants have driven a cab at one time or another—you don’t have to speak more than a few words of English to drive, and you can choose your own hours—most don’t make a career out of it, ascending instead to the second or third of the American Dream (ie an ethnic restaurant, laundromat or grocery). Still others scrape their way (back) into the professional classes, but nearly all of those who have ever driven keep a licenese tucked in their back pocket or on the top shelf of the closet, just in case.
Now, more and more immigrants are cashing them in. I talked to a man from White Plains who had left a job in retail and returned to cab driving in October—he commuted three hours a day just to drive in Manhattan, and this was at the beginning of the crash. I haven’t gotten the data yet on how many renewees came out of the woodwork in 2009 vs. January and Februray of 2008, but if the stats are anything like they were in October, the actual number of licensed NYC taxi drivers looking to get on the road is up.
The problem? There’s only 36,000 medallions, which means only 36,000 cabs can troll Manhattan for fares at any given time. Which means brokers are free to charge $800 a week (remember, we don’t yet know if they are, but the supply and demand wise, it would make sense) even if hacks aren’t catching ANY fares at all. The drivers are stuck, because if they can’t make it work, there’s a queue of people right behind them ready willing and able to try, and their spot in line is to precious. Even in October, the waiting list for cabdrivers at Queens’ biggest brokerage was a mile.
So here’s the question— how are New York’s immigrant drivers fairing with fewer fares? Are individual owners mortgaging their medallions to powerful brokerages for a killing, or are savvy driver/owners sitting on their assets. As property values plummet and the stock market looks increasingly like a fire-sale, are the people trading in taxis really the smartest folks around?