San Francisco’s largest taxi firm, Yellow Cab Co-operative, has filed for bankruptcy.
The independently owned co-op began operations in 1977, formed after the bankruptcy of the Yellow Cab Company with the intention of getting the company’s drivers back on the road.
Today it operates nearly a third of the city’s 1803 taxis, with 1100 drivers.
However, in a letter to shareholders its president Pamela Martinez blamed “serious financial setbacks” and “business challenges beyond our control and … of our own making”.
Another statement said an unusual number of accidents played their part.
But many reports pin the blame on the success of ride share apps Uber and Lyft – both founded in San Francisco. The firms continue to drop their prices and expand their fleets. In early 2015, Uber CEO Travis Kalanick claimed the company’s revenues in San Francisco were about $500m a year.
Last year, Yellow Cab Co-op was deemed liable for an $8m pay-out after a passenger was paralysed in an accident in one of their cabs. Uber, currently valued at around $50bn, is able to pay for such lawsuits far more easily.
Services like Uber and Lyft have faced protests all over the world from people claiming they dodge local licensing and safety laws. In San Francisco they have also been accused of poaching drivers from the Yellow Cab Co-op.
The Yellow Cab Co-op itself has denied the bankruptcy means the end of the business. They recently launched their own app Yo Taxi and claim that operations will continue as normal.
A statement says it “intends to continue its operations as before, and is taking steps…to ensure this goal and prevent disruption to YCC’s passengers, drivers, employees and members.’