Recent shake-ups in Austin occur as two of the countries largest ride-hailing companies move out of the city following an ordinance regarding driver background checks. Although the two companies spent more than $8 million supporting a ballot that would have abolished the fingerprint requirements, the residents of Austin were not on their side. This seems to have been the final straw for Uber and Lyft, and their departure from Austin was announced less than two days later. So what will happen to the big hole in the market they have left behind?
Well, introduce Fare, the originally Phoenix-based ride-hailing company. With this hot off the press news, CEO of Fare, Leto got straight in there with the Mayor in Austin and started operating there just three days later. Within their first couple of weeks of being in Austin, the company had completed over 20,000 trips. However, Fare is not the only ones who have noticed the potential that Austin has to offer. There are at least five other ride-hailing companies also looking to make their mark in the city and take a piece of what Uber and Lyft left behind.
Other U.S cities could also be affected by Uber and Lyft’s stance to fingerprinting checks with Uber already pulling out of Houston following their decision to adopt the same ordinance. But it won’t just be passengers and the economy who will be affected. Drivers of Uber and Lyft have been left in the lurch without jobs following the sudden departure of the two companies, and they could now be facing legal action against them for ceasing operation without giving fair warning to its staff.
Although the two individual companies may be against the idea of fingerprinting checks, it is evident that the drivers do not support this stance. Since their departure, the city has processed over 1750 requests for background checks, with 1600 asking them to share their details with the ride-hailing companies, indicating that these are the former drivers of the companies. Driver’s checks that come back showing more than three moving violations, or charged with driving with no insurance or on a suspended license are automatically prohibited from driving for TNC’s.
Help is being given to those that have been left without jobs during this massive shake-up of the industry in the form of support in finding new jobs or claiming unemployment, but it may be a while before the city of Austin completely recovers. But, with these new companies quickly jumping in the gap in the market and filling it with better services than Uber or Lyft could it is definitely a sign of good things to come.
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