New York City’s Taxi and Limousine Commission (TLC) voted to block the issuance of new for-hire vehicle licenses for electric vehicles. The move was widely perceived as a snub toward Revel, the company best known for its electric moped-sharing service, which was planning to launch a ride-hailing service using a fleet of Tesla vehicles.
Revel announced last April that it planned to launch a ride-hail service in Manhattan with a fleet of 50 Tesla Model Ys. The company had been hoping to exploit a loophole in the city’s current rules, which caps the number of new FHV licenses but exempts wheelchair-accessible and electric vehicles. The cap was originally enacted as a way to stem the tide of new Uber and Lyft vehicles that were flooding the streets. On Tuesday, the TLC voted 5-to-1 remove the exemption for electric vehicles, effectively closing off that pathway for Revel.
Anyone who wants to acquire a new FHV license for an electric vehicle will be subjected to the same semi-annual review process as those with gas-powered cars. And those who already own an FHV license for a gas car are still allowed to transfer those licenses to an electric vehicle if they so choose.
“This is one of the moments for which the cap was created — to provide a check and balance for businesses whose strategy is to disrupt the system, adding to congestion and putting profits and growth before the City’s welfare,” TLC Commissioner and Chair Aloysee Heredia Jarmoszuk said in a statement. “The TLC is committed to an all-electric future and our proposed rules would, for the first time, include BEVs in its required biannual analysis of potential need for additional vehicles.”
Jarmoszuk expanded on the notion during Tuesday’s meeting, characterizing Revel as a venture capital-backed disruptor that will harm yellow taxi drivers and worsen congestion. “It is not sustainable to allow an unlimited number of new vehicles to the road in a city that is all too familiar with the choke of traffic congestion,” Jarmoszuk said, according to the New York Post. “What we will not allow is the opportunity for another corporation — venture capitalists or otherwise — to flood our streets with additional cars.”
Revel’s pitch to launch a ride-hail service wasn’t just about putting cleaner vehicles on the road. The Brooklyn-based company said it also planned on hiring its drivers as employees, as opposed to classifying them as independent contractors like Uber and Lyft. In a statement, Revel CEO Frank Reig blasted the TLC for its lack of deliberation, claiming the vote was predetermined.
“The TLC never intended to consider what drivers and New Yorkers had to say, and only cared about jamming through this vote on Primary Day with as little scrutiny as possible,” Reig said. “This decision doesn’t change the fact that New York City needs an alternative to the predatory leasing system that exploits drivers and pollutes our environment, and Revel is exploring ways to accomplish that.”
The TLC’s vote was baffling to many people who see the environmental benefits of electrifying the city’s for-hire vehicle fleet. Andrew Salzberg, who worked at Uber as director of transportation policy and writes a newsletter about decarbonizing transportation, said he was “surprised” by the commission’s stance on Revel’s plans. In his latest newsletter, Salzberg writes:
It’s reasonable to be skeptical of the chances of success of any individual business model. I can’t predict if Reig and his team at Revel will ultimately build a successful business, and many zero emission vehicle startups have come crashing back to earth this year. But Revel is willing to put real money in the ground to build charging infrastructure, pay drivers a reasonable wage, procure dedicated electric vehicles, and try to put a little competitive pressure on Uber and Lyft’s long term plans for zero emission fleets. What’s not to like?
The city’s tech industry is also taking shots at the TLC, calling the vote a “step backwards” in the fight against climate change. According to Julie Samuels, executive director of advocacy group Tech: NYC, the commission “sent the message that tackling climate change is not a priority, at a time when virtually all New Yorkers agree we should be doing everything possible to take on this urgent challenge.”