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Uber and Lyft make gains in Central Arkansas; some cab drivers struggle to compete

by Emma Pettit | October 1, 2017 at 4:30 a.m.

It's 1 p.m. on a weekday at Bill and Hillary Clinton National Airport/Adams Field. Cabdrivers lounge in mismatched chairs, arms crossed, and watch outlaws besiege Dodge City.

Gunsmoke plays on the small TV in the one-story building where drivers wait for customers. An abandoned game of dominoes is laid out across a table. A passenger hasn't come by in a few hours, says Deodis Williams, who is sidled up to a vending machine.

Williams drives for Greater Little Rock Transportation Services LLC, which does business as Yellow Cab. He's driven taxis in the capital city for 43 years and said he's worried that this year might be his last.

When he started, he'd get a passenger every hour or so at the airport. But in the past five years, his business has dwindled. 2017 has been his worst.

"Uber has killed us," Williams says, gesturing to the other drivers seated around him.

Smartphone apps like Uber and Lyft have upended the ride-hailing business. Instead of dialing phone numbers, users can request rides on apps, get estimated fares, and track their drivers to and from their locations using GPS. The prices often are lower than cab fares.

Uber arrived in parts of Arkansas in 2014. In September, Lyft was approved in the state. Some Arkansas drivers who contract with the companies say the apps offer convenience, for the driver and the passenger. But some taxi companies complain that the apps don't do enough to regulate drivers or protect passengers.

As Lyft enters the mix, some central Arkansas cabdrivers and cab owners say they don't think it will shrink their existing market, but others aren't so sure.

On a Thursday afternoon, Uber driver James Morgan edged his white Honda Civic onto an empty street. He described the central Arkansas ride-booking market in one word: "Inconsistent."

Morgan drives for Uber part time to supplement his income, like many others who drive for the company.

He said drivers in Little Rock usually can't predict when they'll get a rush of customers or when a dry spell will hit. He lives near the River Market District and often peeks out his window to scope out the scene.

"If I see six or seven Uber drivers just sitting there, there's no way I'm working," Morgan said.

Ked Jones of Jacksonville said he's logged more than 2,000 rides in just a year for Uber. Like Morgan, Jones uses the app to make extra money at night or on weekends. He holds down another job at Wal-Mart.

Jones just started driving for Lyft and said he thinks other drivers will toggle between the apps. It'll cut down on the wait time between rides, he said. For Jones, ride-booking is less of a commitment than operating a cab is. He can use his own vehicle on his own time, he said.

That autonomy is a benefit that Lyft and Uber, and other ride-booking platforms, tout to potential drivers.

The ride-hailing companies contract with individual drivers who are covered under the companies' insurance policies while using the apps. Uber and Lyft calculate fares based on the times and distances of trips, plus a base amount and booking fee. The geographic location of the ride is also a factor, as is the time of day. Drivers can pocket between 70 percent and 80 percent of the trip fares paid by the customers.

It was the apps' cheap fares that drove Christian Alexander away. He spent three months as an Uber driver before switching to Little Rock Yellow Cab.

The competitive pricing that apps can offer "was good for the passengers, just not good for the drivers," Alexander said. Regular expenses, such as wear and tear on the car and maintaining certain insurance, added up, he said.

Alexander has driven cabs for the past two years and said his business was OK at first but has been "slashed" since the beginning of 2017. He attributed some of the decline to the ride-sharing apps.

"Lately, it seems like everybody wants cheaper routes," he said.


Ellis Houston, majority owner of Little Rock Yellow Cab, doesn't dispute that using ride-hailing apps is frequently cheaper.

The Little Rock Board of Directors used to regulate changes in the metered rates for taxis until Uber came along, City Attorney Tom Carpenter said. Now, cab companies can raise or lower their rates so long as they give notice to the city.

Yellow Cab charges $5 for the first mile and $2 for each additional mile, according to its website.

Little Rock officials also allow cabdrivers to negotiate more competitive prices when necessary, Houston said.

"If Uber says, 'I'll take you to Hot Springs for $50,' our cabdriver can say, 'I'll take you for $45,'" Houston said.

Yellow Cab holds 120 taxi permits, though the number of cabs on the street fluctuates with the season, Houston said. Drivers are independent contractors, meaning they rent their vehicles by the day or by the week, and work "when and where they want to," he said.

His cab-driving philosophy: "As long as somebody's in the back seat, you're making money."

Houston also owns cab companies in Birmingham, Ala., and along the Mississippi Gulf Coast. Since Uber took hold a few years ago, Little Rock Yellow Cab has seen a 15 percent drop in business, Houston estimated, though he doesn't attribute it solely to the ride-hailing apps.

With Uber and now Lyft in central Arkansas, Houston said he thinks Yellow Cab has the infrastructure to compete with and outlast some part-time drivers. The taxis are inspected every month, or every 5,000 miles. Cameras log everything inside and outside of the vehicles, he said. People driving their own cars often don't have the means for that upkeep, he said.

"It all looks like peaches and cream to begin with," Houston said of driving for Uber or Lyft. "Then all of a sudden [the driver] needs new transmission, he needs new brakes."

Plus, he said, taxi drivers are vetted with thorough criminal-background checks and are shown the ropes by other drivers before they begin.

Lyft and Uber also require background checks and driver's license verification, though state regulations can be more strict. A 2015 Arkansas law requires ride-hailing "transportation network" companies to each pay a $15,000 annual fee and to vet potential drivers.

Thirteen complaints have been filed with state Attorney General Leslie Rutledge's office against transportation companies, including Uber and Yellow Cab, between Jan. 1, 2015 and Wednesday, according to records received under the Arkansas Freedom of Information Act.

In one complaint, filed September 2016, a Fayetteville woman said an Uber driver picked up her 16-year-old son, who has impulse control issues, and took him on an early morning joy ride on her dime.

In another complaint, filed August 2015, a Little Rock woman alleged that a Yellow Cab driver struck a pedestrian while she was in the cab, and then kept driving. The company denied the incident, according to the document.

To compete in the virtual market, Yellow Cab has a website and a smartphone app. But cabs also serve customers -- such as elderly people and poor people -- who don't use websites or apps, Houston said.

"The elderly population, in particular, is not going to put their credit card on the Internet" to use a smartphone app, Houston said.

"The economically disadvantaged might not have a credit card," he said. "Or they won't have a smartphone. Or they won't have both."


When asked if he owns Argenta Transportation Co., George Beavers responded, "It's more like it owns me."

Beavers founded the downtown North Little Rock van service in 2003. He added three drivers but has since cut back to just himself and another man. He's struggling to pay off the loans on his 14-passenger and six-passenger vans, he said.

"I'm not as good as I thought I was," Beavers said.

Uber was a "big factor" in the downturn of his business, he said.

Beavers said he still gets calls for rides, and takes patients to and from a local hospital. But business is "touch and go," he said.

"I try not to be concerned," Beavers said, "but it's difficult not to."

Another transportation company owner, Ken Leininger, started Ken's Cabs LLC in 2015 even though the city of Little Rock had denied him a permit to operate. He'd driven for Yellow Cab for eight years and decided to strike out on his own.

In December 2016, a court ruled in favor of Ken's Cabs and found that a part of the city of Little Rock's transportation code was unconstitutional. It had created a monopoly on taxi services, the judge ruled.

Leininger now maintains a fleet of three vehicles with seven drivers, including himself. At first, his business struggled because ride-booking apps were able to "undercut us quite a bit," he said.

Still, many of Leininger's clients are regulars, who schedule weekly trips to the airport or doctors offices, he said. His drivers also cart people from central Arkansas to Atkins, Dumas or even Germantown, Tenn., he said.

People in small towns don't have localized means of transportation, he said.

"They search for someone who's willing to come out there and pick them up, and we're willing to do that," he said.

Even with Lyft in the state, Leininger said he thinks his clients will keep calling him.

"It's not like we have dozens of taxis we're trying to keep busy. I think it'll hold up for us," Leininger said. "I hope so."


At the airport, cabdrivers browse local-access television. Half-empty bottles of hot sauce litter the TV stand. Drivers filter in and out of the restroom and keep an eye on their yellow cars, parked two by two in the taxi queue.

Randall Peters sweeps his hand diagonally toward the ground when asked how business is going. Five years ago, money lost on a slow day could be made up on a good day.

"Now, every day is a bad day," Peters says.

Still, he plans to stick it out.

"I've got a bad heart," he says. "I can't do anything else."

In the intermission between rides, the drivers occupy themselves, Williams says.

"We play dominoes. We laugh."

From the corner, Alexander draws a different picture.

"You watch TV," he says. "Then, people argue."

Metro on 10/01/2017

Print Headline: Some cabs idling in Uber, Lyft age; But central Arkansas taxi owners are sticking it out, hoping for a turn


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