The taxi industry spent heavily to defeat it. Critics called it an unregulated dark zone. Some even questioned whether its drivers were dangerous.
But in the end, those misgivings about ride-hailing could not match the public appeal of a new and potentially easier way to get to and from
Los Angeles on Tuesday became the largest city in the nation to open the door for companies such as
It was a major victory for the rapidly growing industry. As the West Coast's busiest airport, LAX is seen as a key venue to demonstrate how the new, app-based "disruptive" technology could blossom as an alternative to driving and mass transit.
Consumers have flocked to the startups because they are seen as relatively cheap and highly efficient, said Harry Campbell, the editor of The Rideshare Guy, a website, podcast and YouTube channel for ride-hailing drivers.
The typical taxi trip from LAX to downtown Los Angeles is more than $50, not including tip. A ride with Uber or Lyft is closer to $30, although prices can climb during high-demand periods.
"Uber was able to build up so much goodwill with consumers that it's almost political suicide to go against them," Campbell said. "When you combine the fact that they have a lot of cash at their disposal, it's very, very difficult for politicians to take any stance against them."
Tuesday's council approval means airline passengers arriving at LAX could summon the lowest-cost Uber and Lyft services from the curb in a matter of weeks. That assumes airport officials can negotiate final contracts with the companies that nail down operating and information reporting requirements. Currently, any transportation service can take riders to the airport, but only limousines, shuttles and taxis can pick them up.
"People are baffled that they can take ride share to the airport but can't take one home," said City Councilman
At the same time, the divided 9-6 vote, and some of the council's related actions, reflected the uneasiness of some lawmakers with the assurances offered by the ride companies and their allies.
A lingering issue is whether Uber and Lyft drivers should be subject to the same fingerprint-based FBI criminal background checks as city cabdrivers. Ride-hailing services, like limousine and shuttle drivers, are regulated by the state, which does not require fingerprint background checks.
Taxi drivers and their companies have insisted that those regulatory differences put them at an unfair disadvantage. At one point, a representative for the legacy industry circulated a binder at City Hall containing arrest records for a handful of Uber drivers that would have disqualified them from driving taxis.
Concerns over background checks intensified last week when the top prosecutors for Los Angeles and San Francisco said they had found 25 Uber drivers with serious criminal records, including murder, assault and driving under the influence.
The taxi industry spent heavily to retain their airport stronghold. Over the last two years, eight Los Angeles cab companies — long-time political players in Los Angeles — spent $595,500 to lobby elected officials at Los Angeles City Hall. Uber and Lyft spent $392,000 during the same time period.
Some taxi drivers, wearing yellow shirts that read "Fingerprints Don't Lie" during Tuesday's hearing, predicted dire consequences from the City Council action.
"We will go out of business," said Steve Jeon, 61, who has driven for Bell Cab for six years. Like all Los Angeles taxi drivers, he is allowed to work at the airport once every five days. Those lucrative, long-haul fares cover the costs for his car lease and his commercial insurance, he said.
"We are already losing fares on the street, and now this — this will be very, very bad for us."
A study from the UCLA Labor Center underscores the airport's importance. From 2013 to 2014, taxi revenue across Los Angeles fell 9% and trips dropped 18%. But LAX remained a bright spot: Drivers picked up 15% more passengers there.
The City Council agreed to ask the California Public Utilities Commission to require fingerprint-based background checks for all for-hire drivers, including those behind the wheel of limousines, shuttles and ride-hail cars. In a separate last-minute amendment, lawmakers also instructed the city attorney to report within a month on what legal authority Los Angeles may have to require fingerprint background checks if state regulators fail to act.
"If the state doesn't create the uniform standards we need to protect the public, then we will," Councilman
Uber has said its background check procedures are as good as those it is being pressured to adopt. The company declined to comment on whether it would operate at LAX if local fingerprinting checks were added as a requirement.
But San Jose International Airport points to one possible outcome: Lyft and Uber declined to operate there after officials mandated city business licenses and fingerprint-based background checks for all drivers.
The LAX permits would require Uber and Lyft to pay the airport a minimum of $25,000 per month from $4 fees for each drop-off and pickup. The fees will go to the airport's general operating budget and probably be passed along to passengers.
Unlike taxis, Uber and Lyft drivers would drop off and pick up passengers only on the upper departure level, a requirement that the companies opposed. They would be required to wait in a holding area until receiving a request for a ride. No more than 40 drivers would be allowed in the holding area at one time.
The council, citing concerns over equal treatment for passengers, agreed to ask state regulators to share data they collect on the number of rides and requests in each ZIP Code in Los Angeles. South Los Angeles Councilman Marquis Harris Dawson asked Uber and Lyft to conduct public outreach in low-income areas and neighborhoods where English is not the primary language.
After Tuesday's vote, William Rouse, general manager of Yellow Cab of Los Angeles, said, "Obviously, this is going to cut into business at the airport — there's no doubt." But he pointed to one silver lining: Revenue for taxis at San Francisco International Airport hasn't declined as much as expected since Uber and Lyft began operating there last year.
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