Former taxi commissioner sees more cities adopting New York's tough rules on Uber and Lyft

Key Points
  • The former head of the New York City Taxi and Limousine Commission predicts more cities are going to adopt the TLC's rules on ride-hailing companies.
  • Meera Joshi's comments were in response to Uber's criticism of the regulations
Former NYC TLC chair on regulating ride-hailing services

Meera Joshi, former head of the New York City Taxi and Limousine Commission, told CNBC on Monday that she predicts more cities are going to adopt the agency's rules on ride-hailing companies.

"[Cruising limits] make a lot of sense. ... They focus on the genuine problem, which is empty cars. I think a lot of cities are going to really look to New York to see if they can adopt similar approaches," Joshi said on "Squawk Alley."

Joshi's comments were in response to Uber's criticism of the TLC regulations.

Uber's CEO, Dara Khosrowshahi, told CNBC last week that the ride-hailing business is suffering in New York City because it had to restrict the number of drivers and increase prices in order to abide by the commission's rules.

Khosrowshahi also said it is a "tragedy" that a "secondary medallion system" is being created in the city.

A year ago, the New York City Council voted to temporarily cap new licenses for for-hire vehicles while the city studies the impact of the ride-hailing industry.

Last Wednesday, the TLC unanimously voted that it will extend the cap for another 12 months. In addition, the commission passed cruising limits that will restrict how long drivers of major ride-hailing companies like Uber, Lyft, Via and Juno can cruise city streets without passengers.

Starting Feb. 1 of 2020, these working drivers cannot drive without passengers for more than 36% of the time while in Manhattan below 96th Street, according to the TLC. The council said this threshold will drop to 31% on Aug. 1 of next year.

These cruising limits will apply from 6 a.m. to 11 p.m. on weekdays and 8 a.m. to 11 p.m. on weekends.

Joshi said the extension of the cap will "ensure that [ride-hailing cars] are constantly being used so the whole ecosystem is profiting including the drivers and there's a constant circulation of the cars."

She also believes that the utilization rate is a common concern among other cities and New York's approach in increasing the rate can help make sure that there are less empty cars on the street and more in service.

The former head of the TLC also added that the council's approaches "are very aligned with the underlying goals of the companies."

Joshi pointed to a recent study from Uber and Lyft that "40% of the time, drivers in San Francisco are without a passenger and clogging streets." She sees New York City's regulations improving traffic congestion and overall transportation efficiency for both companies and cities.

"Chicago and Washington D.C. [are being] much more active about requiring basic data ... about how [many] cars are on the street and how often they have passengers. ... Every major city you talk to, this is a recurring theme. They need to manage the street space," she said.

"Both the company and the city [need to have] a mutual understanding of what's going on on the city streets and how to manage it."