Amid all the hoopla in Seattle over the legality of app-based transportation companies like Lyft, Sidecar and UberX, many supporters of the “ride-sharing” movement have criticized the taxi industry for failing to keep up with technology.
However, there are actually ways to hail a taxi or for-hire vehicle — and pay for the ride —with your smartphone.
Flywheel, which launched in Seattle this past October, is an app similar to Lyft and Sidecar and allows people to track their rides, pay with one click and rate drivers. The company has partnered with 275 vehicles from Eastside For Hire, a local company that charges a flat rate calculated by pickup and drop-off zip code.
The combination of the two companies seems like a great match — riders can take advantage of the technology and not have to worry about insurance or other legal questions that currently hover over new services like Lyft, UberX and Sidecar.
However, Eastside for Hire is actually violating city code by using the app because Flywheel takes $1 from each rider. There are also issues with a default tip included in the fare.
The City of Seattle told us that while “there are generally no difficulties using a smartphone app,” Eastside for Hire is not following the city’s existing for-hire regulations that require companies to file their flat rates. The last rate adjustment Eastside for Hire submitted to the City was in March 2013, well before it began using Flywheel.
City records show that Seattle’s Consumer Affairs Unit emailed Eastside for Hire managers on Oct. 16, 2013 to notify them that they would need to file new rates with the City in order to legally use Flywheel’s app. The email outlined three laws that Eastside for Hire was not following:
1. The rates used by the Flywheel smartphone application must be the same as the flat rates filed by Eastside with the Director. If you wish to change your rates, you may file new rates with the Director.
2. The fare charged to the passenger cannot include a default tip. If you wish to increase fare revenue for the drivers equal to an average 20% tip on the fare, you may file 20% higher rates with the Director.
3. The fare charged to the passengers cannot include a $1 booking fee. If you wish to increase fare revenue for the drivers equal to $1 per trip, you may file new, higher rates with the Director.
We’ve left messages with Eastside for Hire representatives multiple times, but have not heard back.
Flywheel told us that as far as it knows, the company is in compliance with all applicable Seattle regulations. Also, it has encountered no regulatory issues in San Francisco and Los Angeles.
“Prior to each city launch, Flywheel worked with city regulators to ensure that they were in line with all city regulations,” a company spokesperson said.
For now, though, it appears that the city hasn’t taken any further steps or issued a cease-and-desist. Meanwhile, the City Council is on the verge of setting new regulations on companies like Lyft, UberX and Sidecar.
Flywheel, which is currently in two-thirds of San Francisco taxis and in 700 others in Los Angeles, makes money off the $1 fees and through a revenue sharing relationship with its driver partners. Flywheel CEO Steve Humphreys said that his company, which has raised $22.8 million, wants to “transform the taxi and for-hire experience in Seattle, like we have done in San Francisco.” He noted that taxis using Flywheel in the Bay Area arrive in an average of three minutes.
“We want to bring that speed and experience to the people of Seattle,” he said. “In Seattle, we offer highly competitive flat rate fares so consumers never have to worry about paying more in cases of high traffic or when taking alternate routes is necessary.”
Humphreys also noted that all companies should adhere to regulations that were put in place to protect passengers, drivers and pedestrians.
“It’s possible to increase competition, use new technology, and follow the law,” he said. “Flywheel is a great example of that. We use state of the art mobile and web technologies, work only with fully commercially licensed drivers, and are providing end users a better taxi and for-hire experience than ever before.”
Other taxis in Seattle also offer riders an app to book and pay for rides. Taxi Magic is currently linked to 500 taxis in Seattle, including those from Orange Cab, STITA, and Eastside for Hire. Unlike Flywheel, Taxi Magic makes money by charging a referral fee to the cab companies instead of the riders. The company told us that more than 400 rides per day are booked with its app in Seattle.