Montgomery County’s largest taxi company filed for bankruptcy on Tuesday in what the company’s CEO said was a bid to reorganize and buy time as it retools to take on so-called app-based competitors Uber and Lyft.
Barwood Taxi, with 457 cabs operating in Montgomery County, was founded here in 1964. Now founder’s son hopes to lead a corporate makeover that keeps the company and its 57 employees (not including drivers) in business.
“[To] employees, drivers, customers. It means nothing, because the business is going on,” President and CEO Lee Barnes told WUSA9. “You’re here tonight. Still open 24 hours a day, seven days a week. Local people employed here locally.”
Barnes said Barwood needs to become more like the competitors that disrupted the taxi industry business model. Iconic light blue cabs will be repainted black, and clunky meters will be replaced by tablets and small credit card readers.
“Customers like a car that’s more discrete, not so emblazoned with so many four and eight inch lettering and big light on the top and advertising,” Barnes explained. The company already uses the “Curb” app to allow for mobile hailing.
Barnes argued that regulatory inequality was the biggest hurdle for companies like his. In Montgomery County, he said, cab companies follow a rulebook that non-traditional competitors like Uber ignore. Barnes cited county regulation of fares and state regulation of background checks as the two biggest disparities that hobble his business.
Barwood could get some relief from the Maryland Public Service Commission on Thursday. The Commission is set to rule on whether to require Uber and Lyft to use the same slower, more expensive fingerprinting-based background check system for drivers that cab companies use.
“Fingerprints are something that are very secure. Its very affordable. We have to pay for our drivers fingerprints and we pay $35 dollars a year for the driver’s fingerprints,” Barens said. “We can afford to do it, why can’t Uber do it? That’s what I don’t get.”
Uber argues that its driver background checks are equally or more effective. The company has said it will be forced to leave Maryland (although likely not immediately) if the Commission rules it must switch to background checks.
Lyft has not made the same public statements, but both companies left Austin, Texas earlier this year when similar rules went into effect there.
