Uber and Lyft experienced losses Saturday as voters in Austin supported a petition vouching for the companies’ drivers to undergo fingerprint background checks.
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Uber and Lyft spent roughly $200 on each vote they received, but only 44% of voters were in favor of Austin’s Proposition 1.
Local media reported that as many as 10,000 Uber drivers could soon be out of work if the company does follow through with its threat.
The Uber IPO looks less appealing to investors after the ride-hailing service threatened to pull out of Austin, Texas, on May 7.
Uber and Lyft are welcome to stay as long as they comply with city’s new regulations which include fingerprinting and displaying emblems on cars.
“We hope the City Council will reconsider their ordinance so we can work together to make the streets of Austin a safer place for everyone”, Uber told CNBC. Much to the dislike of Uber & Lyft, the Austin election could set a precedent for other USA or even non-US cities encouraging other cities also to ask for fingerprint based criminal background checks. That meant, among other things, drivers would have to be fingerprinted as part of a background check.
Our story from last week discussed the factors surrounding the companies’ campaign, which was the most expensive in Austin’s history.
Other cities statewide are considering stricter background check regulations for drivers.
According to Lyft and Uber, the new rules required on them make it hard to keep continuing business models.
Lyft released a statement following the vote that said, “the rules passed by the city council don’t allow true ridesharing to operate”.
The governor has signed a bill into law that sets up new statewide standards for internet-based ride-sharing services like Uber and Lyft.
“We’re not asking them to leave”, she said. This comes on the heels of a killing spree by ex-UBER driver Jason Dalton, which left six people dead in Kalamazoo, Michigan.
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Mayor Steve Adler of Austin released a statement Monday, announcing a city-run finger print background check option for potential drivers to be ready should the mobile-hail services resume or continue operations. Uber and Lyft stopped working in Corpus Christi just two months ago as well… also because of fingerprinting.
