- Uber recently announced a three-year lobbying initiative costing $10 million
- Company wants cities to institute a tax on drivers entering congested cores
- Tax could help company boost rider volume by making private trips more costly
- Alternative could be caps on the number cars Uber is allowed to have in a city
- New York City has already put a one-year ban on new ride-hailing licenses
- Uber vows to spend $1 million next year in NYC alone to push congestion prices
Uber has vowed to spend $10 million lobbying city governments across the U.S. to institute so-called ‘congestion pricing’ taxes on drivers.
The company, which has already aggressively pursued a congestion pricing law in New York City, announced the three-year lobbying plan last month, saying it would pursue such policies in other cities.
In a statement, Uber CEO Dara Khosrowshahi said the company would lobby for ‘ideas that put the long-term public interest over maintaining the mobility status quo, even when doing so is politically difficult.’
As yet, no American city has ever implemented a congestion pricing zone, which is essentially a toll on drivers who enter certain parts of the city at certain times.
Uber CEO Dara Khosrowshahi (above) has announced a plan to lobby for congestion pricing taxes in cities across the US – a policy that the company stands to benefit from
The congestion pricing approach has been tried in European cities such as London and Stockholm, and urban planning experts say it allows cities to manage traffic without persistently adding new lanes and roads.
For Uber, the business appeal of congestion pricing is clear.
A recent study shows that services like Uber increase traffic congestion in dense cities rather than relieving it.
That’s because the majority of Uber riders would have taken transit, walked or biked if they hadn’t used the ride hailing service, the study found.
Faced with mounting traffic congestion, regulators in New York City have brought the hammer down on Uber and similar ride-hailing services.
In August, New York’s city council passed a one-year moratorium on new licences for for-hire vehicles while the city studies the rapidly changing industry.
By making private trips more costly, Uber could see its number of rides increase. Congestion pricing would also circumvent attempts to limit the number of Ubers in NYC (pictured)
As an alternative to such a moratorium, congestion pricing would present Uber with several benefits. The company could simply pass the toll along to riders, and would likely see ride volume increase as the costs of personal vehicle trips went up.
Consequently, Uber has been lobbying aggressively for congestion pricing in New York, and has committed to spending over $1 million next year to lobby legislators to pass such a plan.