The battle over the coveted New York City taxi market has been brutal in recent months. And a quiet player on the block has just thrown what could very well be a knock-out punch.
Tel Aviv-based ride-hailing app GetTaxi, which operates as Gett in the U.S., announced this week that all rides in Manhattan will be $10 for the rest of 2014.
While the offer doesn’t extend outside of Manhattan, a $10 ceiling on any ride within New York City’s central borough is still a highly competitive offer.
“New York is a really crowded space, we wanted to do something big and substantial so that people would have to give us a shot,” said Brooke Moreland, Gett’s head of marketing for the U.S. “We are confident that once people start using Gett, they will stick with us even after our rates go back to normal. We also wanted to draw attention to the fact that we always offer flat rates, and we don't have surge pricing, even when we aren't doing a promotion.”
In response to worries about how the price deal would affect its drivers, Gett said drivers would continue to be fully compensated and that the company is paying to make up the difference.
The ridesharing service, which also operates in London, Moscow, St. Petersburg, and several cities in Israel, launched in New York City last summer at the same time that it announced a $12 million Series C round of venture capital funding. GetTaxi was then operating in 20 cities and was profitable in 16 of them.
Not all ridesharing companies moved into the Big Apple as quietly. San Francisco-based Lyft was met with a temporary restraining order by the New York Attorney General’s office when it tried setting up in New York City earlier this summer. The company has since been given clearance to operate, but only because it has agreed to use drivers certified by the New York Taxi and Limousine Commission. In other cities, Lyft operates under a model where non-professional drivers provide rides.
Meanwhile, both Gett and Lyft have the same enemy. Ridesharing giant Uber is the largest fish in the pond, and has aggressive expansion goals. The San Francisco-based company recently released a feature making it possible for the service to be embedded into third-party applications like OpenTable, Starbucks and United Airlines. And even though it was recently banned in Germany, it has continued to offer service and seen a surge in signups. Uber is direct in its goals for global coverage. It calls its vision “UberEverywhere,” and it’s the idea that a driver is always five minutes away, no matter where you are.
It’s anybody’s guess where the taxi industry will be in a few years, but one thing’s certain: the competitive knock-out rounds are good for customers who are looking to jet around New York City above ground without breaking the bank.