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In Vegas, there’s no free market for taxis
Regulators, not invisible hand, guide supply to match demand
Monday, Feb. 16, 2009 | 2 a.m.
Sun Archives
- Fewer visitors means fewer fares to go around (2-8-2009)
- Conventions not spared sting of slump (2-8-09)
- Taxi board adds no extra cabs for MAGIC (1-30-2009)
Beyond the Sun
For as long as anyone can remember, the Nevada Taxicab Authority has accommodated tourism growth in Las Vegas by annually letting more cabs onto the streets and allowing “special medallion” cabs to serve gatherings of at least 90,000 people.
That is until last year, when the regulatory body recognized that the slowing economy didn’t warrant more cabs.
Another first: Regulators chose not to allocate additional cabs for this month’s World of Concrete, Magic and World Furniture Market trade shows.
Expectations for 120,000 attendees at the Magic apparel show have dwindled to 60,000, with similarly depressed estimates for the other shows.
Cabdrivers, who have for years criticized the agency for putting too many cabs on the road, aren’t exactly declaring victory. In fact, some are declaring war.
The Taxicab Authority, which allocates taxi licenses among 16 companies, oversees a controlled oligarchy protected from outside competition and somewhat shielded from market forces. Regulators allocate medallions — licenses to operate cabs at certain times — by gauging demand using statistical research, interviews with tourism insiders and firsthand observations. Proponents say this keeps out companies that would rip off customers, slash competitors’ tires or otherwise fight for access to tourists.
Regulators have a mandate to ensure that passengers get the best possible service.
Historically, that meant more cabs — placing the agency in perpetual conflict with drivers.
Drivers accuse taxi officials of bowing to the profit motives of the companies they regulate, allocating more cabs than necessary. It’s a self-serving argument: fewer cabs means fewer competitors for passengers.
Better to err on the side of too many cabs than too few, regulators say. Better that tourists have an enthusiastic cabbie at the ready than leave Las Vegas angry about a long wait.
It’s hard to argue with the more-is-better theory, unless, of course, you drive a cab.
As the economy has worsened, drivers have called the Taxicab Authority to urge the further removal of cabs.
During last month’s International Builders Show, drivers made desperate calls to the governor’s office to turn up the heat on taxicab officials.
Around the same time, the Taxicab Authority pulled 26 of the 72 medallions allocated for the five-day event based on daily figures reported by cab companies and observations of slow business at the airport and the convention hall.
Appeals from drivers don’t factor into such decisions, Taxicab Authority Administrator Gordon Walker said.
While companies have thousands more medallions than they did a few years ago, there are only about 250 more cabs in use today than in 2004, or fewer than 16 cabs per company during a period in which more than a dozen buildings have sprouted on or near the Strip.
Last year’s official count on visitor traffic was flat with 2004, however.
Some companies say they’re on the same side as drivers in the supply-demand debate.
Lucky Cab’s profit margin is less than 10 percent, owner Jason Awad says — lower than many tourism businesses, including big casinos. Companies also make money selling advertising space on cabs, regardless of whether there are any passengers in the cab. But Awad says much of his revenue pays for fixed costs, including $12,000 per driver for auto insurance.
On an average weekend, revenue is down more than 20 percent from before the downturn, he said.
Cabdrivers, working through breaks or forgoing days off to make $6 an hour, aren’t sympathetic.
“I had always made pretty good money and had a lot of years with a lot of companies,” said James Ashcraft, who quit driving a cab for lack of business and is seeking unpaid wages under the state’s minimum wage law. “Now a lot of us are struggling.”
Discussion: 26 comments so far…
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Thank the President and harry Reid. They drove up fuel prices and now the Pres bad mouths Las Vegas. The only true thing he has said this month is "it's going to get worse before it gets better".. and no place is that more true than Las Vegas.
"They drove up fuel prices..."
Do tell Neiman. How did Harry, and especially Barack, drive up fuel prices?
Which president are you referring to when you say the president drove up fuel prices? Surely you must mean Bush because Obama certainly wasn't in the White House when we were paying over $4 a gallon for gas - you remember, about the time Bush admitted being surprised that gas prices were that high! Ya, he wasn't even smart enough to at least PRETEND he knew what the heck was going on - but then again why should he or ANY politician for that matter really care about the price of a gallon of gas? It's nice like it's gonna break them.
It was the Democrats who push to kill and stop drilling over the last 2 decades for new oil that lead to the price increases of the past years.
The market was in panic mode because the capacity of supply was just barely above the capacity of demand. Any cut in supply, like a Iranian war, would have let the world short of supply of oil and lead to a tremendous increase in prices.
The spectulators were betting that shortage of supply was going to occur.
If we had a more robust supply of oil in the USA than that spectulation would have been greatly reduced and the prices with it.
Democrats never face up to the fact that their policies have negative results.
Like the push now for renewables that will result in big price increases 15 to 20 years from now for energy for our homes.
I am sure that the Democrats will do then what they do now: "Who me? I dunno know. What renewables are costly? Who knew?"
"It was the Democrats who push to kill and stop drilling over the last 2 decades for new oil that lead to the price increases of the past years."
True or not, that is not the reason for the increases. Unprecedented demand from developing nations, which has now abated, was.
We're much better off driving fuel efficient cars than drilling for the last bit of oil under our own soil. It would be better for America to lead the way in producing amazingly great cars than to keep drilling for oil to fuel inefficient ones until we run out. Create the cars first, drill later.
"Like the push now for renewables that will result in big price increases 15 to 20 years from now for energy for our homes."
15 to 20 years from now many homes will create their own power via rooftop solar and wont need to buy any power, or little power, from the grid. Many will sell power to the grid and profit from it. New homes will be built with it. Older homes will benefit from government subsidized retrofits.
End result? Zero electric bills, near zero electric bills, and checks to consumers.
I like my vision of the future way better than yours.
tsk, tsk, not even a month into his term and Obama has already developed a shocking plague for all the neocons. It's a version of Bush Derangement Syndrom, only now it's Obama Derangement Syndrom. What else do you want to erroneously blame Obama for neiman? Really, should we try to pin the Tsunami on him? Or hey what about the Hindenburg? Or Pearl Harbor? You seriously need to stop drunk typing.
Here's the primer on why gas prices haven't followed oil on a downward track. Basically, the quoted oil price is West Texas crude (today trading around $37/bbl), and storage facilities are swamped with the stuff. But many US refineries can't get West Texas crude for lack of pipelines, and have to rely on more expensive (and, ironically, lower quality) crude from the North Sea and the Middle East.
Plus, you have refiners cutting production in response to the recession. So gasoline stockpiles are low, even while oil stockpiles are extremely high.
http://news.yahoo.com/s/ap/20090216/ap_o...
In other news, aluminum prices have doubled in the last 30 days, as neiman's demand for aluminum foil hats has created massive shortages.
"15 to 20 years from now many homes will create their own power via rooftop solar and wont need to buy any power,"
Put your money where your money is....go out and purchased one those "free" power systems.
They only cost around $40,000 grand and they have limited life like all systems. Which means in about 20 to 30 years, you will need to replace it.
Of course, you will get tax money to help you. You know that money that is going to placed on the backs of your children and their children to pay back with interest.
Also, you think you never need power from the grid. What about at night when the sun is not shining? Storage systems are very very expensive.
LOL.........Thank you for proving my point that libs never think of the negative results of their ideas.
The actual numbers do not Lie. Articles downplaying the legitimate concerns of 7,000 licensed Taxi drivers serves nobody but a handful of industry insiders who have all but ruined this industry and reduced many to minimum wage...
http://taxi.state.nv.us/Monthly%20Stats/...
Business is DOWN 15% 2008-2009 and down 12% from 5 years ago for drivers. Apparently to the Sun those declines indicate a Flat-market.
"LOL.........Thank you for proving my point..."
LOL, Jim, you twist everything to prove your 100% never ending correctness and intellectual superiority over all others.
I said in 15 to 20 years. You simply used CURRENT economics to try and disprove the future.
What is the historic economic trend for electronics and technology Jim? 10 years ago, a 42" Flat screen was $10,000 dollars. How much are they now Jim? LG -$659, as of today.
Have you no vision at all beyond your dismal predictions? We're on the brink of a revolution my friend. Your negative attitude is going to have you miss it.
Try filling your head with what you want to happen instead of what you are afraid of. I swear it works.
Maybe the damn taxis will start showing up at residential calls now. I quit even bothering trying to set up a taxi ride to the airport years ago. If they showed up, which was rare, they were late. I realize that the Strip is the Valley's money maker, but it would be nice to look a little beyond the glitz to those of us who are trying to live here.
"I said in 15 to 20 years. You simply used CURRENT economics to try and disprove the future"
I forget you have a crystal ball to predict the future.
Remind me next time.
Can you tell me who will win the super bowl next year?
I'm guessing Nance(y) hasn't heard of Moore's law
http://en.wikipedia.org/wiki/Moore%27s_l...
$40,000 for an combo solar wind system... sorry overblown. I hope ya have a bit of petro chem lube for pulling those # out of your A## nance(y)
Right now sup power systems run about 20k including your basic lead acid battery bank. Future battery tech will improve that.
Then again what does this have to do with cabbies.
JSin
Where are all these excess taxis? I guess they're all on the Strip going after the shrinking tourist dollar, while the rest of Vegas can just rot without adequate transportation. Just last week a friend of mine waited over 2.5 hours for a cab (calling repeatedly to be told that they were still trying to find a taxi to send). He finally just gave up. He's in a wheelchair and needed an accessible cab. I've had other friends in wheelchairs waiting 1.5 hours for a cab in the past few weeks, or told a cab isn't available. Seems to me that the demand for cabs is there. The cab companies just don't want to be bothered with actual Vegas residents trying to go places other than the Strip, especially if they're in a wheelchair!
Jsin(y)....you need to learn to read.
Johnevegas wants one to power his 4,000 square foot house and sell power back to the grid. That means he wants a higher end model and not a cheap one.
He needs at least a 6.48kW Residential Grid Tied Solar System. That system generates about 800 kilo-watts per month. He probably uses around 1,000 to 1,200 month. So this system will still be short by about 200 to 400 kilo-watts per month.
Just one of these cost $50,000.
http://www.helioselectric.com/sales/inde...
He still needs battery storage so when the sun does not shine, like at night, he needs something. They have batteries that last a few hours and generate low power.
The whole amp thing is a killer, too. He has to careful when he turns on his A/C, TV, blow dryer, etc. Those systems, even the high end ones, do not carry that much amp capacity.
Perhaps you can link to your $20k imaginery high end system . I hope ya have a bit of petro chem lube for pulling those # out of your A## Jsin(y).
Also, I meantion the true cost. Sure you might get a $40,000 system for $20,000 after a $20,000 tax credit of which your children and grandchildren will pay via Federal debt with interest.
There is not a current solar or wind or combo that will feed your house 24/7. What major storage system that you can link to that hold power for days to feed a 4,000 square foot house for days? I guess you will punt on that too.
Solar and wind have been around for 40 plus years.
How much longer do you need for your Moore's law to improve the technology to make it feasible financially?
100 years???? 1,000 years? Jsin(y) punt again??????
"I forget you have a crystal ball to predict the future."
Who needs a myth for this? Stop denying the obvious while trying to stay correct. I said HISTORY! What's so hard about looking backward? You do it constantly with Clinton.
By the way, I do not have a 4000sqft house. But I do plan to sell power to NV when I'm at work and my house is empty and sitting under that hot sun all day. At night, I'll buy some back.
And to hell with batteries!!! A smart solar system requires no batteries. We are not talking about taking a house off the grid. We are talking about zeroing out an electric bill.
So, I do not care about battery technology. I care only about the cost of creating solid state solar cells. I've already told you that the technology is about to double it's efficiency. Why can you not remember this Jim? Does it not suit the stories you like to propagate? It requires little vision to see that this will continue.
Now, go watch your amazing cheap TV for a while and think about how wrong I must be, because you are required to be right. I guess.
"But I do plan to sell power to NV when I'm at work and my house is empty and sitting under that hot sun all day"
You must be planning to turn off you A/C and fridge. I guess that will work. Just expect to come home to a over a 100 degree house during the summer and melted ice cream.
At least, you do not state that current technology even remotely gets close to your goal of power bills with zero amount due.
Yes, definitely the AC. The house will stay below 85 in the summer, then we'll kick it on in the evening when we're at home.
Currently no. Still too expensive. But not long.
Remember all the cellular stuff I mentioned? I tested the world first dataphone in 1995. It was called the Airphone. Voice and data in one. $1200 bucks a pop for an analog cellphone with a built in modem.
How much was your last phone? What all does it do? Built in browser? MP3s? Camera? Camcorder? Email? Texting? TV? Games? GPS?
Man, if that can happen in 15 years, surely this is a non issue. You don't need to be a guru to see this stuff.
But batteries? Ya, I'm with you. Still nothing really workable in site. Solar to hydrogen daytime then hydrogen to power in the evening might work, but we'll need to see how fast and far they move with fuel cells.
Check Honda's work with the FCX. Not bad for 5 years. That could be a realistic and workable solution for homes too. All they need to do is scale it. The first company to do that will have a rich rich future. Solar to hydrogen, then hydrogen to APU. Awesome!
The problem with your comparison with the cell and solar technology is that solar technology is much older than cell phone technology.
Solar technology has been around for decades.
I remember people getting solar kits in the 1970's.
Well number 1 nancy. a 4000 square foot home is EXCESSIVE. Period Do you really need it?
AC solveable at almost no cost... any guess what the temp is just a couple feet under the soil??? Any guess what happens to heat. <hint convection>
Have you heard of DC driven high efficiency refrigeration?
Are ya aware that without power they can keep your precious ice cream cold for 24 hours without power?
Yes solar has been around for decades. There was no market driving it. Why? cause of cheap oil. Little incentive. There is incentive now and already prices are falling. It is how it works.
Is the change going to be comfortable. Nope. Is it gonna be cheap.. Nope
Ya don't like cell tech well lets look at green tech that has already shown promise... CFL <compact florescent light> Price 6 years ago 19.95 ea
Price at Home Depot 1 week ago. 2.49 a 4 pack
Demand drives reduction in cost as tech improves.
JSin
jsancy......thanks for admiting that the current technology of solar has a long way to go before it becomes a practical cost effective technology.
I sure hope that you do not live underground to get all that free A/C but that would explain a lot if you did.
If you guys had big bucks to spend you can get battery systems that can deliver hundreds of amps to inverters for periods of even days. The mfg. are C&D, Exide, and others and you look for the same systems used for telecommunications and/or the military. I don't think "off grid" power for housing is very practical because you cannot recover your investment. A system that feeds the grid when you don't need it and then uses from the grid when you exceed the systems capacity has a better chance of working.
So if there are too many taxis on the street, then why do we have to wait hours for a taxi to pick us up away from the strip? Riddle me that.
On the solar power subject, there is plenty of sunlight out here in the Mojave desert, it is one of our greatest natural resources. We should really be pushing for solar energy, the more demand there is, the better the technology will get, and the cheaper it will be to obtain it. All political persuasions, except for those anti-sunlight folks, can benefit from such technology.
JSin "Yes solar has been around for decades. There was no market driving it."
Exactly. People don't buy the stuff the way they do with LCD televisions or cellular phones. But they will.
OBAMA THE MAGNIFICENT WILL FIX ALL THIS, GIVE HIM TIME