In a move as bold as its signature pink mustaches, Lyft says it is moving forward with its New York City launch despite threats from taxi regulators. The San Francisco-based startup allows users to hail rides from car services through its app. The problem is that neither the cars nor their owners are regulated by the NYC Taxi and Limousine Commission—and it’s a problem that could come with hefty penalties for Lyft's drivers.
The NYC taxi commission has declared Lyft unauthorized in the area because it "has not complied with TLC’s safety requirements and other licensing criteria to verify the integrity and qualifications of the drivers or vehicles used in their service," according to a statement. The agency goes on to warn that Lyft drivers risk as much as a $2,000 fine and losing their vehicles to "TLC enforcement action."
Starting July 11 at 7 p.m., a fleet of 500 mustachioed cars will begin picking up customers in Brooklyn and Queens. For riders uneasy about getting in a car with an unauthorized driver, Lyft wrote this assurance in a blog post:
Every driver has undergone a screening process that is more stringent than what’s required for NYC taxis, including a strict background check, vehicle inspection and $1,000,000 insurance that provides more than three times the $300,000 minimum for taxis.
Lyft’s brush with the powers that be is nothing new: Rival on-demand car service Uber has been the target of insurance companies and regulators, as well.