Why New York Commission Blocked A Tesla Model Y Taxi Fleet

NYC allegedly asked Revel to buy 50 gas cars first in order to proceed its electric taxi launch.
Ameya Paleja
Revel ride share uses Tesla Model YRevel's Model Y taxis

Last week, Teslarati reported that the New York Commission had blocked the launch of an all-electric taxi fleet from the startup Revel. The report caused outrage among Tesla fans and even questioned the priorities of the Commission which was allegedly asking Revel to buy 50 gas cars before introducing its Tesla Model Y taxis. Elon Musk also appeared stumped on Twitter. 

The decision passed with a 5-to-1 vote makes it illegal for Revel to introduce its fleet in the city in one clean sweep. Revel CEO Frank Reig had called the decision, "shortsighted bureaucracy and entrenched interests" reported Teslarati.

As the week has progressed and dust begins to settle, there is more clarity on what the Commission's decision means for Revel and the city's taxi drivers. To understand it better, we need to go back to 2018, when the New York Taxi and Limousine Commission (TLC) imposed a temporary ban on all new taxi licenses with an aim to ease congestion in the city and improve incomes of existing taxi drivers by capping the number of taxis available. However, this ban excluded electric vehicles and wheelchair-accessible vehicles (WAVs). Revel relied on this exception to launch its fleet of 50 all-electric taxis. 

The 2018 ban was extended multiple times to help taxi drivers cope with the fallout of the pandemic. But in a public meeting on June 22, the TLC voted 5-to-1 to remove the exception given to electric vehicles. This was flagged by media reports as a ban on electric vehicles. The WAVs are still exempted from this ruling but Revel's Tesla Model Ys are not wheelchair accessible as of now. 

The only option left for Revel is to buy existing licenses of taxis powered by gas, retire them and then replace them with electric vehicles, but the media reports skipped the 'retiring part' and highlighted the purchase of gas-powered cars. This allows for the introduction of electric vehicles and a sustainable means of transport without actually increasing the congestion in the city or reducing earnings for existing taxi drivers.

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The TLC ruling is intended to increase the proportion in the city's fleet from the meager 0.5 percent it currently stands at. “The TLC is fully committed to a 100 percent electrified future, just not at the cost of additional congestion, "Allan Fromberg, TLC's Deputy Chief of Public Affairs clarified to Teslarati in a follow-up interview. 

Others, including Revel CEO Frank Reig, are more skeptical of the TLC's motives. In an interview with The Verge he said, "The TLC never intended to consider what drivers and New Yorkers had to say, and only cared about jamming through this vote on Primary Day with as little scrutiny as possible. This decision doesn’t change the fact that New York City needs an alternative to the predatory leasing system that exploits drivers and pollutes our environment, and Revel is exploring ways to accomplish that."

Also of note, Revel plans to hire its drivers as employees. Something many other services have refused to do. And the taxi lobby in NYC is, admittadly, notable. So it does leave questions about the ultimate motives. 

Update: This article has been updated to include additional quotes from Revel's CEO.