Do you drive a taxi? Do you know how many people drive 7 days a week? Or even 6 days a week. Driving day in and day out is not for everyone. Go look at average salary for taxi drivers. It is low for a reason. Not because taxi driving doesn;t pay well. IT DOES. It is these guys don;t work more than a couple days a week for some. The ambitious ones absolutely do.
But the daily garage I rent out of has plenty of cars sitting around every day, not being driven. So while oe can potentially make 6K renting out medallion to two people...uh, do me a favor and go and try and find reliable people who will show up for work consistently who happen to also drive a taxi to make money. Taxi driving lends to flexibility and attracts a very interesting crowd and kind of person...yes, I guess that says something about myself.
But its the flexibility and the lack of education required to still make good money that attracts the crowd.
uhhh...michael, no I don;t think an unlicensded entity will replace an unlicensed one...but I don't see the "unlicensed" one disappearing anytime soon either.
The loan was based on income figures along with credit score. Not everything is as hard as people imagine. It's not 20% or no in business. Banks and loan companies try to make deals that make financial sense based on numbers so they can make money.
20% is an assumed standard, but it doesn't mean a company cannot go lower. They said I would only need 10% down, and my monthly bill with interest included would come out to 3652/month to own the medallion.
Call them up yourself. It's just not a good proposition at the current valuation. Someone mentioned why not lend it out. Sure, that would be nice. But again, I prefer driving the hours of 1PM-1AM if that late. To find someone to do the opposite shift on a consistent basis is not easy. Meanwhile, I face the headaches of someone else using the vehicle and potentially damaging my livelihood. Not ideal. Not at this valuation.
I get the flexibility for the same price from a garage without any risk and do not have to worry about the medllions potentially continuing to deteriorate in more value over the coming years, or interest rates popping.
Essentially UBER is a more compelling offer in terms of one investing in their own car and maintenace of vehicle at current taxi valuations, than to go out and purchase a medallion and take on the headaches and burden of a powerful loan.
UBER's strength is not a result of the income it provides people, it is the control of a vehicle without a medallion which required a significant down payment along with the 25 year burden of paying down the loan, hoping one doesn;t get sick and one doesn;t face a ballon loan pop which causes them to lose their down payment and medallion and waste their time. Price is not attractive.
To inquire about purchasing a medallion. I was told there was a distressed sale available for 750,000m man couldn't work and wanted out and he was underwater to boot. I was told I would only need a $70,000 down payment and would be able to get a loan of the remainder at an interest rate around 4%. My monthly cost for the medallion at that level would come out according to them 3,650/month give or take a couple dollars. The garage I currently work out of charges me 146 a day(I use the car at 1PM so they charge me extra as I have the car for more potential hours). My monthly cost of using a car at this rate for 6 days/week comes out to about 3,00 dollars. So to own a medallion for 3650 seemed like a decent move UNTIL the mention of a balloon loan as the condition on the loan. In 3 years time, the loan would have to be renegotiated based on interest rates then, so if rates go up, your loan payments go up. So pretend that interest rates go up 50% in 3 years, I now owe potentially 4500+ on the loan instead of the 3650 I agreed to 3 years prior.
Meanwhile, without the headaches of owning ones own medallion/car, I can just drive whenever I please using a daily garages car working as little or as hard as I please based on my necessary bills as opposed to the medallions will.
Its a no brainer. I don;;t see the appeal of owning a medallion at current prices with all the threats still out there, unles one has the money to put down a significant down payment.
Before UBER there were economic counterforces in terms of car service. Anybody who wants to drive and make money is not limited...get up and go. There are taxis waiting to be driven along with UBER along with CARmel and Dial 7. There is no reason for deregulation. Regulation is there for the drivers benefit as much as the owners. Drivers make good livings, significantly better than average, especially owner-operators.
right....and we are going to be flying around too in about 40 years with our own rocket propellers so the medallion will be worthless too...
Agreed, it is all a shaky situation. UBER can easily cut their percentages down to 15%. I met an Uber driver in nyc who told me he was making 300/day, 6 days a week, working 12 hours. So an extra 15% in his pocket is nice, but I'm wondering if it really makes that much of a difference?
Why? Well, I went out today on sunday and drove for 12 hours and just made 350 profit. Im wondering if UBER is as powerful as they think they are.
UBER is just another car service, it seriously is. There were car services in manhattan before UBERt existed, Dial 7, carmel, and so on. UBER is just another piece of the pie and sure dilutes the water a little, but not enough to where I;m seeing how one would not want to own a medallion at 725,000 or less if they were doing this for a living.
Why? I currently do 6 days and pay about 146 for the car from the garage as I start working in the middle of the day(I prefer those hours but pay extra for them). The same money I'm paying weekly to RENT a car fot 6 days, I could buy a medallion and basically if I could get a 30 year loan on it, my monthly bill NOT weekly, would amount to maybe 100 or 200 more than what I am currently paying weekly.
So since I'm already throwing that kind of money weekly, I might as well own a medallion for the same price monthly...the big question becomes do I want to?
Correct, there are many people out there who have absolutely no interest in owning a medallion....and yet they drive anyway. But again, why would they use uber which requires them to maintain their own vehicle, pay their own insurance, and have them get "judged" by every passenger on a nonsense rating system....when if/when the medallion value comes down and offers them to just get up and drive with no headaches outside of the driving(no maintenance of vehicle, no insurance payments, no ridiculous passenger rating system).
I guess one needs to drive in order to see it better as 2.5 mnths ago, I did not have the same understanding of the medallion as I do now. But at a certain price, owning somehting that then gives you all the rights to the profits instead of a share is more compelling than giving 30% of EVERYTHING one does or whatever the percentage. Whatever percentage UBER comes up with, the medallion will correct and adjust. I'm not looking at the medallion as an appreciative asset, I am looking at it as an asset that would allow me to increase ones own earnings. UBER is a parasite. It does nothing but feed off drivers. You can say the owners of medallions are parasites too....but the owners at least put money down for an asset, they took a risk and bought a piece of property like any landlord. UBER just creat created an app and can decide at whim what percentage they want to take from YOUR hard work...not such an incentive.
Very true, UBER can lower its take from 30% to something lower to try and counter the effects of the lower medallion potentially causing those who drive for uber to shift back to medallion....but you are making a mistake in thinking people will not become smart enough to realize better to invest in owning something that eventually will be paid off and they aren't making many more so at some point you are not giving any of your profits away, no matter the percentage, as you now own the medallion that entitles you to all the profits one can get from driving and the medallion price itself will allow those to rent their cars out for cheaper than the 116 to 146 rate as their costs of the medallion were significantly cheaper than others and this will influence drivers not interested in owning a medallion still a more compelling offer than giving away a percenge of ALL the work you do. With the medallion, at some price level, whether you paod 116 to 146 today, or in the future if the prices continue to deflate and one can pay 80 or less, it will intrigue drivers who realize after they make that money, the REST is ALL theirs, where UBER right now is the virus that doesn't stop eating and takes a share of all your work. I have no interest in "working" for Ube and giving them a share, I would rather own the medallion and keep everything. I can only thank UBER for now causing the overdue correction...that will ultimately hurt itself.
As a driver,who pays to rent a cab daily, I would obviously love to have the extra 116 to 146 one can pay for a shift from garage. At the same time, I do not believe that it is beneficial for people in general to have an unregulated industry. Deregulation will not be beneficial to cab drivers or their riders. It will be chaos out there. People forget that an UBER driver is a person who gets up and goes driving and he needs to get up and go do it. Nobody is compelling him to goout there everyday other than his own bills, wants and needs. What needs to happen is medallion prices need to continue to deflate as they have been doing where it becomes attractive again for people to prefer taxis over UBER and they switch back.
Basically a CORRECTION is being undertaken, a well deserved one. The fat cat owners are paying the price as the public, or those interested in medallions now realize its not the ONLY game in town. Competetion always brings about a rebalance of valuation, no reason taxi medallions are exempt. If someone wants to open a store, they go around and look for the cheapest rent/best location and go with the best offer. UBER right now for some offers a compelling offer. They drive their own car, drive when they want(making their own hours entirely) and give 30% for the "luxury". But as medallions continue to correct, there will eventually be a bottom and UBER and its 30% take will not longer be compelling and UBER will go the way of the dinosaur or many other small business that only thrived for a small period in history when it noticed something wa overvalued and offered a compelling change...but when UBER becomes the one overvaluing its product(its 30^ plus take of everything one does), people will switch back to the medallion. Not hard to foresee.
Having a free for all with people just ALL going out with their cars whenver they want to work is not i the cards as the cities all want to fight congestion.
I would like to see the price come down another 40% for the medallion....and it then becomes very attractive. Uber has its market and its obviously successful as it serves a purpose that the "markets" clearly wanted. But it doesn't mean people have stopped hailing taxi's or that taxi drivers have somehow made less money as a result of Uber, at least in NYC. A driver going out on a 12 hour shift in NYC and paying anywhere from 116 to 146 for their cab(double shift is 146) can still make 250 on average a day driving. One doesn;t even need to necessarily do a 12 hour shift as I personally make that much driving less than a 12 hour shift. Would love to own the medallion at half the price. Uber is just another car service and serves its purpose with its app, but in a city with a taxi system in place like NYC, Uber it THE niche whereas taxis are the business.
Wear andd tear on the uber vehicle is going to kill these drivers. They are taking on all the headaches(insurance, vehicle maintenace) etc that Uber takes no responsibility for. At the end of the day, the UBER driver faces more headaches with the customer having a lot of power in terms of rating of service(do you know how many garbage passengers are out there who have no qualms about hurting another persons credibility despite it not being deserved)? Many.
UBER is a headache. Good for remote cities with no major taxi industry, but those with one like NYC will generally go unaffected as the city continues to grow.,
at the same time, I don;t own a medallion, just drive daily. But bottom line is cities are growing especially nyc and drivers are in demand.
Exactly as someone else pointed out, an Uber driver is just some average joe looking to make an extra buck. He is not a BETTER driver, or even EXPERIENCED driver. He is just a guy looking for some extra money and like anything done half#$%$ they evenutually burn out and quit doing it as they don;t want to be doing it in the first place. Uber is just a means of exploiting a drivers hard work for creating an APP. They own nothing(as in a piece of property such as a medallion of limited quantity) that would entitle them to share in profits from driving. They just created an APP that is easily copied by many other companies(lyft, via, etc) making it hard to differentiate the difference between any of them. They also overcharge. When you get into a taxi, you know the fare is always the same.
As a night shift driver, Uber is not affecting me at all. Making 250 on average. Uber is around, but Uber not as threatening in nyc as it seems to be in other cities.