New Flywheel-brand taxis to hit SF streets

Taxi app Flywheel has made another play to fend off competitors Uber and Lyft by creating a new line of the traditional yellow cab.

By launching a new fleet of cars branded “Flywheel,” the app company hopes to attract more passengers who may be leery of traditional yellow cabs and weary of the scandals Uber has kicked up. (San Francisco-based Uber in 2014 faced accusations of drivers raping and beating passengers, indictments from South Korean officials, exploiting hostage situations in Australia and the scandals of employees tracking riders or spying on journalists who were critical of them.)

Redwood City-based Flywheel, which makes an app for hailing city-authorized cab, announced Wednesday it will rebrand more than 300 of DeSoto cabs so they read “FlywheelTaxi.” Flywheel makes an app similar to Uber’s and Lyft’s, but the ride requests go to licensed taxi drivers who work for city fleets.

By the end of February, one in six taxis in San Francisco will be labeled FlywheelTaxi, the company said.

Flywheel also said it has reached an agreement with San Francisco International Airport, becoming the the first taxi app to operate at the airport. Uber, Lyft and Sidecar have for months had deals with the airport to pick up and drop off passengers, but these apps are considered Transportation Network Companies, a transportation category established by the state that falls under different regulations.

Flywheel is trying to capitalize on consumers’ frustration with Uber’s and Lyft’s surge pricing, which involves jacking up the cost of rides when demand is high. Passengers have shared horror stories of rides that cost several hundred dollars on a busy night, such as New Year’s Eve. Flywheel on New Year’s countered with a flat $10 per-ride offer and no surge pricing; the app saw 60X growth that night alone.

Flywheel grew tenfold in 2014. The app is available in San Francisco, Los Angeles, Seattle, San Diego and Sacramento. New CEO Rakesh Mathur has pushed to revamp the company, which has seen several iterations and several different leaders since it first formed in 2009. It started off with the name Cabulous, but its clunky technology almost spelled the end of the company until a big revamp in 2012.

But Flywheel can only do so much to protect the taxi industry from a gorilla such as Uber. Not only are taxis losing passengers, but taxi medallions — the license that designates a car as a taxi, and for which cab drivers pay several hundreds of dollars — are losing value, according to one analyst. The Associated Press reported Tuesday that Jefferies analyst Sean Darby said in a note to investors that taxi medallions are not the “safe haven” in terms of investing that they used to be as taxi companies face increasing competition from Uber and similar services.

Photo courtesy Flywheel


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