New York City’s ride-hailing duopoly of Uber and Lyft is facing a surprisingly scrappy challenger: an app called Empower that’s letting drivers keep 100% of their fares. It’s a direct shot across the bow of the industry giants, and the city is taking notice.
A Driver-Focused App Disrupts NYC’s Ride-Share Market
Empower is offering significantly cheaper rides and higher driver earnings, but is operating without a license.
- Empower allows drivers to set their own fares and keep all the revenue, minus a $50 monthly app fee.
- The New York City Taxi and Limousine Commission (TLC) deems the app illegal, lacking the required “base” registration.
- Empower’s CEO claims Uber is actively working to shut them down, fearing an “existential threat.”
- Rides on Empower are substantially cheaper than Uber and Lyft, but come with potential risks due to lack of TLC oversight.
What’s the difference between Empower and Uber/Lyft? Empower flips the traditional model by giving drivers complete control over pricing and earnings, while Uber and Lyft take a significant cut of each fare.
The company, Empower, pitches itself as a pro-worker platform. Drivers pay a flat $50 monthly fee for access to the app and then pocket every dollar from each ride they complete, setting their own rates. The result, according to Empower, is cheaper fares for passengers and increased income for drivers.
But this model is running headfirst into regulatory roadblocks. The city’s Taxi and Limousine Commission (TLC) has publicly warned New Yorkers against using Empower, even creating a dedicated website (https://www.nyc.gov/site/tlc/drivers/safety-illegal-apps.page) outlining the risks. To legally operate in New York City, ride-hailing apps must register a “base” – a dispatch facility – with the TLC, a process that requires a $1,500 fee and vehicle insurance.
“We’re not completely averse to that idea, but we do think it’s important that drivers should have the right to work for themselves,” Empower CEO Joshua Sear said, openly defying the city’s regulations. “Every licensed professional has the ability to work for themselves and determine how much they want to charge for their own services.”
Sear claims “thousands” of drivers are completing “tens of thousands” of rides weekly through Empower. While a small fraction of the 88,000 drivers providing over 4 million weekly rides for Uber and Lyft, Sear believes the industry giants are paying attention.
Uber declined to comment on Sear’s allegations.
Empower’s strategy echoes Uber’s own early days in the 2010s, when the company frequently launched in cities without seeking prior regulatory approval, directly competing with established taxi services. In Philadelphia, for example, Uber launched “UberX” in October 2014 without official authorization.
The company is currently embroiled in civil litigation with regulators in Washington, D.C., who objected to its launch without approval. A judge found both Empower and Sear in contempt of court for continuing to operate, a ruling they are currently appealing.
Despite the legal challenges, Empower continues to operate in New York City, offering significantly lower prices. A recent ride from Bushwick to SoHo during the Monday morning rush hour cost $28.18 on Empower, compared to $68 on Uber and $60 on Lyft. A 3.5-mile, 28-minute trip from Lower Manhattan to the Port Authority Bus Terminal was $21 on Empower, versus $34 on Uber.
Sear argues that Empower would willingly comply with city regulations if it didn’t believe they were designed to protect Uber’s market dominance. “Uber controls almost all the bases,” he said.
The TLC maintains that Empower must follow the proper licensing procedures. Agency spokesperson Jason Kersten stated, “Despite repeated attempts to encourage Empower to apply for a license, it continues to operate illegally.” Kersten warned that riders using unlicensed apps risk untracked trips and limited recourse in case of issues, and drivers face fines up to $500, license suspension, and loss of benefits if involved in an accident.
Empower isn’t the only app skirting the rules. Luxy, a “professional black car booking platform,” also operates without a TLC license. The TLC also flagged WhatsApp groups like “Tri State Limo Owner Operator” and “Sale & TLC Rental” for illegally dispatching cars from networks of licensed and unlicensed drivers.
The rise of these apps highlights the financial pressures facing drivers for established platforms. Uber and Lyft drivers are grappling with rising costs for insurance, vehicle financing, and increasingly larger commissions taken by the apps themselves. Some drivers are resorting to soliciting rides outside airports, charging whatever price they can get, according to reporting from Gothamist.
Bhairavi Desai, Executive Director of the Taxi Workers Alliance, noted that some union drivers have used Empower to supplement their income. However, she believes Empower needs to gain wider consumer adoption, which she argues requires operating within the legal framework.
