Cab rides are poised to get slightly more expensive in New Orleans, but representatives of the taxi industry are eyeing the first fare increase they’ve seen in six years warily as they face going head to head with potentially lower-cost competitors such as Uber.
The council approved the fare increase on a 6-0 vote Thursday, with Councilwoman Stacy Head absent.
“We have all talked about this important transportation issue and existing challenges that face our taxicab industry,” said Councilman Jared Brossett, who sponsored the ordinance and heads the council’s Transportation Committee. Those challenges include large lease payments for their vehicles and equipment, additional costs they incurred because of upgrades the city required before the 2013 Super Bowl, a market that runs “hot and cold” depending on whether it’s tourist season, and new competition from ride-hailing services such as Uber, Brossett said.
“I’m looking to give taxi drivers a reasonable increase so they can continue to serve our public and make a decent living,” he said.
Taxi drivers have been calling for a fare increase for years, with calls growing louder after new regulations were put in place that required cab owners to buy new equipment and in many cases new vehicles. Some industry officials said those upgrades ran into the tens of thousands of dollars for some cabs.
City officials had said at the time that they would support a rate increase to offset those costs, but it never materialized.
But with the introduction of more competition into the market from ride-hailing services, some taxi industry representatives were wary that higher fares could push more passengers to those companies or other transportation options.
“We’re very concerned about it,” said Niran Gunasekra, a leader of the cab drivers union.
Under the fare structure approved Thursday, the minimum cab fare, which applies for the first one-eighth mile of a trip, will remain unchanged at $3.50. Every additional one-eighth mile will cost 30 cents, up from 25 cents at present.
The cost of airport trips for one or two people will rise from $33 to $36. For trips with more people, the rate will go from $14 to $15 per person.
Trips for those going to cruise ships will jump from $10 for a single rider to $14 for one or two riders. With more than two passengers, the charge will be $8 per person — $1 more than it is now — or the metered fare, whichever is greater.
The minimum fare per person for cab rides during special events such as those at the Mercedes-Benz Superdome, the UNO Arena and similar venues also will increase, from $5 to $7.
The ordinance needs Mayor Mitch Landrieu’s signature before it can go into effect.
Once that happens, the meters in the cabs need to be adjusted to register the new per-mile fare.
Gunasekra said he generally feels the new rates are fine, but he told the council that he worries the new price structure would give more of an advantage to services such as Uber because they could undercut taxi prices. That could be particularly true for trips to the airport, where taxis already face competition from shuttles.
Gunasekra said the higher fares also could mean low-income residents will find themselves unable to afford to take a cab.
Jason Coleman, of Coleman Cab Co., said the city should have put more effort into studying the proper fares for cabs. Rather than just increasing fares, he said, the whole rate structure — including fares for special trips such as those to the airport — should be looked at more closely.
The goal, he said, should be keeping cabs as a viable alternative to public transportation.
“You don’t want to burden the poor. You don’t want to outdo the market,” he said.
Follow Jeff Adelson on Twitter, @jadelson.