New York City has moved to regulate the huge growth of Uber and similar firms with a temporary cap on new licences for ride-hailing services.
The city council approved a package of bills that included a one-year moratorium on new licences for vehicles used by the services while the city studies the rapidly changing industry. The legislation will also allow the city to set a minimum wage for app-based drivers.
Backers of the proposals said both the traditional yellow cab industry and drivers for app-based services were suffering as Uber cars flood the city’s streets. They said the growth of ride-hailing apps had also worsened traffic congestion.
“More than 65,000 working families will be getting a desperately needed raise because of today’s vote,” said Jim Conigliaro Jr, founder of the Independent Drivers Guild, which represents drivers for Uber and other services.
Bhairavi Desai, the executive director of the New York Taxi Workers Alliance, said the councils’ vote set a precedent for the world as companies such as Uber and Lyft use technological innovation “to return us to a time of sweated labor, destroying lives and livelihoods across the planet”.
But Uber spokeswoman Alix Anfang said the pause on new vehicle licenses would “threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion”.
She said Uber would do whatever it takes to keep up with growing demand for its service and would work with city and state officials to pass “real solutions” such as congestion pricing for cars in Manhattan.
New York is Uber’s largest American market and is the first US city to attempt to regulate the growth of app-based ride services.
A similar cap on Uber and other car services was proposed in 2015 but did not attract enough support. City officials said that in the intervening years the number of for-hire vehicles on the streets had surged from 63,000 to more than 100,000, forcing drivers to compete for scarce fares and making it difficult for any of them to earn a living wage.
At the same time, the exchange value of a taxi medallion required to operate a yellow cab has plunged from more than $1m (£775m) to $200,000 or less, forcing many medallion owners into bankruptcy. Debt and financial hardship have been blamed for the deaths of six taxi and car-service drivers in the past year.
Opponents of the legislation said Uber and Lyft provide a much-needed service to areas outside of Manhattan that were not served by traditional taxis. They also said black and Hispanic people need ride-hailing apps because yellow cab drivers often woould not stop for them.
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But Laurie Cumbo, a Democrat councillor, said Uber will still be available despite the moratorium on new cars. “Uber as you know it is going to be Uber as you know it,” she said. “You’re not going to be stranded. Uber is not going away.” The legislation will go before the city’s mayor, Bill de Blasio, also a Democrat, who is expected to sign it.