THE NEW ECONOMY
TO DRIVE A YELLOW CAB IN NEW YORK City, you need to buy a business license. A “medallion,” they call it. At their peak in 2013, a New York taxi medallion could cost you as much as $1.3 million, and you had to wait in line to buy one. Still, it was considered a reliable investment, given that the average price a decade earlier was just $250,000. The total number of medallions in circulation is tightly regulated, but the New York population keeps growing. If you want to hail a yellow cab, it will be from one of only about 14,000 license holders. That’s in a city that in 2010 had a population of over 8 million.
Then, in 2011, Uber’s rideshare service reached the Big Apple, and others soon followed. The yellow cab industry’s century-long monopoly crumbled, and a handful of medallions were reportedly sold at auction in 2017 for just $186,000. The genie is out of the bottle.
A similar conflict is raging in the bike industry, though it’s not quite as far along. Consumer-direct sales of complete bikes are only just starting to pull high-end buyers out of bike shops, but if the trend continues to grow, what will it mean for shops? What about for the riders?
