He wanted a bailout because Uber and Lyft have hammered his business. He leveraged himself to the hilt financing more taxi medallions than he should have and now he’s crying in his beer because he is losing business and medallion prices are tanking. Boo hoo, he wants his government protected monopoly to remain insulated. Unfortunately for him the market has come calling and creative destruction is doing its thing. Even Freidman’s new crony buddy, Mayor DeBlasio probably wont be able to save him.
Uber is just better than taxis. It’s as simple as that. The taxi companies should either evolve and compete or they should close shop. And that whole bit about cab companies having to adhere to laws Uber doesn’t have to is a red herring. If it’s such a problem why don’t the cab companies lobby to reduce livery regulations?
Why don’t they? Because these regulations were written originally to benefit the cab companies in large part.
I’ve got no sympathy for this guy.
Are Freidman’s business troubles explained by disruption of the yellow cab industry? Uber’s upending of the taxi market is the single biggest factor that explains the drop in ridership and medallion values, as well as the rise in frozen credit and loan delinquencies. But almost every taxi industry player I’ve spoken to has been intent on distinguishing Freidman from the rest of the medallion owners. “He is 100 percent not representative,” says Tweeps Phillips, the executive director of another trade group, the Committee for Taxi Safety. “Gene is an issue all unto himself. His issues are his making.”
What they’re getting at is this: If Uber is chiefly responsible for driving down the price of taxi medallions, Freidman played a big role in driving it up in the first place. Allow him to explain his strategy: “I’d go to an auction, I’d run up the price of a medallion, then I’d run to my bankers and say, ‘Look how high the medallions priced! Let me borrow against my portfolio.’ And they let me do that.”