Hybrid taxis for New York City
A Federal judge crushed New York City’s plan to force existing taxi operators to use higher efficiency vehicles (nytimes article). The city’s politicians seem helpless in the face of this decision, which says that only the Feds can regulate emissions or fuel consumption.
Is the city truly impotent? It is the city alone that decides how and to whom to issue taxicab medallions. The number has been fixed for decades while taxi fares have been allowed to rise, resulting in a trading value for the medallions of $600,000 (a return on this investment must be recovered from the hapless customers).
If the city wants to see hybrid or electric taxis on its roads, why doesn’t it issue new taxi medallions to drivers who promise, in exchange, to use high-efficiency vehicles? The fare on these new, presumably smaller, taxis would be set at 75 percent of the fare on the standard gas guzzling taxis. Consumers could choose the spacious gas guzzlers at a higher fare structure or a more cramped ride in a Prius at a lower fare. As most people are cost-conscious, eventually most of the taxi miles driven would be in Prius-style vehicles rather than the current V8 guzzlers.
How could the operator of a Prius survive on 25 percent less revenue per mile than the current operators? The Prius operator wouldn’t have to pay $600,000 for a medallion from an existing owner, but rather perhaps just a $1,000 per year inspection fee. The Prius operator would be paying less for fuel.
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