A new ride-hailing app, Empower, is challenging Uber and Lyft’s dominance in New York City, offering significantly lower fares but operating without the approval of the city’s Taxi and Limousine Commission (TLC).
Empower’s Model and Regulatory Challenges
Empower markets itself as a “pro-worker platform” where drivers pay a $50 monthly fee and retain 100% of their fares, which they set themselves. The TLC requires app-based ride services to register a “base” – a dispatch facility – and secure a license, a process Empower has not followed. The company is expected to pay a $1,500 application fee and provide insurance for its vehicles.
Empower CEO Joshua Sear defends the company’s approach, stating, “We’re not completely averse to that idea, but we do think it’s important that drivers should have the right to work for themselves.” He argues that licensed professionals should be able to determine their own rates. Sear claims “thousands” of drivers are providing “tens of thousands” of rides weekly through the app.
Price Discrepancies and Legal Battles
Empower’s fares are substantially lower than those of its competitors. A recent ride from Bushwick to SoHo cost $28.18 on Empower, compared to $68 on Uber and $60 on Lyft. A 3.5-mile trip from Lower Manhattan to the Port Authority Bus Terminal cost $21 on Empower, versus $34 on Uber. The company is currently appealing a contempt of court order in Washington, D.C., stemming from its launch without regulatory approval.
Sear alleges that Uber views Empower as an “existential threat” and will attempt to stifle its growth. Uber did not respond to a request for comment on these claims. The TLC has warned drivers using Empower that they could face fines up to $500, license suspension, and loss of benefits if involved in an accident.
A Wider Trend of Unlicensed Services
Empower is not the only ride service operating illegally in New York City. Luxy, another “professional black car booking platform,” also lacks a TLC license. Informal dispatch networks operate through platforms like WhatsApp. Some drivers, facing rising costs and reduced earnings with Uber and Lyft, are seeking alternative income streams, even if it means operating outside of established regulations.
Frequently Asked Questions
What is Empower’s business model?
Empower charges drivers a $50 monthly fee to use the app, allowing them to set their own rates and keep 100% of the fare.
What is the TLC’s position on Empower?
The TLC insists Empower must apply for a license and operate legally, warning drivers of potential fines and license repercussions for using the app.
How do Empower’s prices compare to Uber and Lyft?
Empower’s fares are significantly lower than Uber and Lyft’s, with examples showing rides costing as much as $40 less for similar routes.
As Empower continues to operate in New York City, it remains to be seen whether the company will seek to comply with regulations or continue to challenge the established ride-hailing landscape.