Wednesday, July 26, 2017
When a technology disrupts a market, the fall-out is usually anything but pretty. Vendors, lenders and others are caught in the same whirlwind of change. That is what is happening to the taxicab industry in New York City. Uber and Lyft have cut the value of taxi medallions and left drivers and credit unions under water with no chance of surfacing. The metal badges once valued in the millions are now worth a few hundred thousands, but lenders allowed taxi drivers to take out loans against the previous imputed value. There is no way for drivers to pay these debts back. The taxi industry can communicate with the city council and try to rein in the disrupters, but the damage is done, The monopoly that the taxi industry had over local transportation is destroyed, and a new era has begun.