Latest Industry News
October 13, 2019
Posted by VIP Lease

Reasons NYC Lawmaker Wants To Limit Uber Car Lease Costs

Over time, there has been growing agitations and disgust expressed by most Uber and Lyft car lease drivers over the exorbitant payments they have been subjected to make back to the rental and car lease companies. Several drivers have aired their experience of being saddled with crushing lease payments in order to work for ride-sharing apps like Uber and Lyft.

About a week ago, City Councilmember Francisco Moya introduced new legislation saddled to tackle rates for a range of scenarios: leasing, renting, leasing to own, and conditional purchase of for-hire cars. This bill was greeted with mix reactions from drivers, rentals, and TLC companies.

The New Legislation

The new legislation introduced by Councilmember Moya aims to protect drivers working for ride-sharing apps and those of for-hire vehicles, livery, and green cab companies from lease costs beyond what they can pay from their driving income. This bill is expected to establish maximum limits for lease payments by collaborating with the city’s Taxi and Limousine Commission.

According to Moya, “For-hire drivers are been made to sign contracts, which gets them locked into impossible payments. The bill will make sure that they’re not being cheated and duped into these impossible payments.”

However, recall that during the summer, acting on the fears by drivers that the cap still allows new drivers to get TLC licenses, there will be a growing number of people sucked into expensive rental rates to start driving. The New York City Mayor Bill de Blasio, proposal to extend the cap to another year was passed. This measure makes a permanent limit on vehicle licenses for companies like Uber and Lyft. This is aimed at stabilizing drivers’ incomes and cutting congestion.

Reactions To The New Law

There are over 120,000 for-hire vehicles on the roads and streets of New York, accounting for nearly 30% of all traffic in Manhattan below 60th Street, according to city-data. Information provided by the Taxi & Limousine Commission shows that about 85,000 are for ride-sharing apps.

As the city pushes to permanently cap the number of for-hire vehicles on the streets, most of these drivers have congregated at the city Taxi & Limousine Commission hearing to tell their stories of how exorbitant car leases are crushing them. Most Uber and Lyft drivers who have no option licensing their cars under the cap on for-hire vehicles are calling on the city to stop leasing companies from charging them sky-high prices.

Before the legislation was introduced, a Brooklyn Uber driver with leased car for years has compared the annoying lease payments as a broad daylight robbery, with no legislation or rules to keep the TLC companies accountable.

The driver’s advocates have linked the Uber and Lyft with the creation of an industry where many drivers languish in poverty, lured by exaggerations about high earning potential and company partnerships with rental companies. The executive director of the New York Taxi Workers Alliance, Bhairavi Desai, opined that the whole scenario is “a predatory lending means where drivers not only suffer poverty week to week because so much of their income goes to paying off these fees but are locked into long-term debt.”

However, an owner of a rental TLC company opined that the said proposal could put the rental industry “in jeopardy” and make it difficult for drivers with shaky finances to lease a vehicle.

The bottom line remains that the new legislation will enable drivers to save more money, and take a break as they need not worry much about hitting the monthly payments.

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