Houston’s transportation options have shrunk. On November 20, Lyft, a car service competitor of Uber and taxicabs, ceased operations. The cessations comes after both Lyft and Uber worked for months to get Houston’s city council to legalize their ride sharing platforms in the face of stiff opposition from taxi companies and drivers. Now, however, Lyft has decided that the regulations that the city put into place are too onerous and aren’t worth the cost associated with compliance.
In an effort to help ride sharing companies operate legally, Houston City Council passed new regulations in August 2014. These regulations force companies to comply with many of the same rules as taxicab companies. Some of these new regulations include requirements that drivers carry fire extinguishers in their vehicles, obtain vehicle inspections, submit a warrant check and personal information to the city, take a medical examination, and undergo drug screening. According to media reports, the regulations would cost each driver $62.
David Mack, Lyft’s director of public affairs, claimed that these new regulations impose hardships on its part-time drivers by adding “a lot of friction for the drivers to not make the system the best way moving forward.”
Lyft’s departure is not the first time that a ridesharing service has ceased operations in locations that they had previously served. Just last week, a Nevada state court judge issued a temporary injunction stopping Uber from operating in the state. The judge found that Uber’s service was not in compliance with the state’s applicable safety, insurance, and licensing requirements.
Without a doubt Uber and Lyft are game changers, and are but two of many platforms designed to connect drivers with riders. As with any new market, there are hiccups. As with any industry, regulations need to balance the health of the industry with the health of the consumer. That balancing is just beginning with ridesharing companies.
If you or someone you know was injured in an automobile accident involving a ridesharing service, contact an attorney at Abraham, Watkins, Nichols, Agosto, Aziz & Stogner by calling 713-396-3964 or toll free at 800-594-4884.