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Uber and Lyft to halt operations in Austin following Prop. 1 defeat

'That shows a real lack of respect for their drivers.'


Samantha Grasso


Posted on May 8, 2016   Updated on May 26, 2021, 7:50 pm CDT

In less than 24 hours, ride-hailing applications Uber and Lyft say they’re leaving Austin, Texas.

On Saturday, after almost five months of back and forth between the transportation network companies (TNCs) and Austin City Council, Austin voters rejected Proposition 1. The ballot measure was poised to allow TNCs to operate in the Texas capital without conducting fingerprint-based background checks on drivers.

Prop. 1 would have replaced an ordinance adopted in December that required TNCs to conduct fingerprint-based background checks. Both Uber and Lyft have argued in the past that their own background check systems are sufficient, and that fingerprinting is unnecessary and not as comprehensive.

Travis County (the county that encompasses Austin) election results showed that only 44.29 percent of voters (39,083 votes) elected to adopt the ordinance, while 55.71 percent (49,158) voted against adoption. Ridesharing Works for Austin, (the PAC backed by Uber and Lyft) spent more than $8 million campaigning for the election.  

Months before the election, both TNCs promised to leave Austin if the proposition failed. On Thursday, Lyft notified its drivers of plans with a text message from Austin-area General Manager Austin Fox. The text stated that Lyft will close its offices at 5am CT on Monday morning.

Lyft Senior Policy Communications Manager Chelsea Wilson sent the Daily Dot a statement saying the TNC will “pause operations in Austin” on Monday.

We want to thank the incredible Lyft community for all they’ve done to keep ridesharing in their city. Thanks to each and every one of them, we took drunk drivers off the road, made it easier for residents and visitors to get around, and provided a flexible way to make ends meet. But we’re not giving up. … We will continue fighting for people in Austin to have modern options like Lyft. For the tens of thousands of you who spoke up in support of ridesharing, we urge you to keep making your voices heard on this important issue.

Uber Austin General Manager Chris Nakutis also expressed gratitude for the city in a statement emailed to the Daily Dot.

Disappointment does not begin to describe how we feel about shutting down operations in Austin. For the past two years, drivers and riders made ridesharing work in this great city. We’re incredibly grateful. … 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.

Though Uber Technologies’ Jaime Moore did not comment on if and when the TNC was leaving Austin, an email sent to users states drivers will cease operations Monday at 8am CT. This despite contradictory statements from Uber employees saying it had no plans to pull out

East Austin bar Lustre Pearl played host to an unofficial viewing party for Ridesharing Works for Austin. The mood grew tense as polls closed at 7pm CT and early voting election results showed the proposition behind by 56 percent.

Austin City Council Member Don Zimmerman, who has spoken out against the language of the ballot and has been against the fingerprint-based background check regulation, dropped by the meetup as election results began trickling in. Zimmerman told the Daily Dot that the city of Austin acted as bullies against Uber and Lyft, and lied by saying fingerprint-based background checks were adopted for safety reasons.

“You pass all these rotten, useless ordinances against people and rules against people—now they can’t afford to do business, and they leave,” Zimmerman said. “So the city now has given them no choice because they’re mandating what the business model is going to look like, and what they have to spend. …We’re the city of over-regulation controlled by the nanny council. We don’t have a city council, we have a nanny council.”

Downtown, campaign staff and supporters for Our City, Our Safety, Our Choice—the PAC against Uber and Lyft—celebrated Prop. 1’s defeat. Soon after the polls closed and well into the night, the atmosphere remained jubilant and enthusiastic as Council Member Ann Kitchen, Mayor Pro Tem Kathie Tovo, and Austin Mayor Steve Adler stopped by Scholz Garten to revel in the win.

One of the PAC’s main arguments throughout the campaign was that Uber and Lyft were the corporate bullies threatening to leave should they not get their way. Kitchen told the Daily Dot that while the TNCs are leaving, the community wants them to stay, and leaving is their choice.

“Uber and Lyft asked for a public election. I am just amazed that they won’t live by what they asked for,” Kitchen said. “And so now that they have heard what the public wants, they’re leaving? That shows a real lack of respect for their drivers, for their customers, and for this community.”

While drivers at the Ridesharing Works for Austin watch party remained hopeful after early voting election results were announced, some drivers the Daily Dot spoke to had backup plans. Two full-time drivers in particular were in the process of making career changes (unrelated to Uber and Lyft leaving), one in the process of obtaining a full-time job, while the other planned a move to Dallas.

In a statement sent to the Daily Dot by Ridesharing Works for Austin’s Travis Considine, PAC spokesperson and former Austin Mayor Lee Leffingwell echoed Lyft’s sentiment of fighting for the future of ride-hailing in Austin.

Unfortunately thousands of people who drive with ridesharing companies to earn much needed income will now have to find another way to make ends meet. Thousands more of our citizens and visitors from around the world will soon have one less option to get around town safely. … The benefits of ridesharing are clear: reduced drunk driving and economic opportunity. And we won’t stop fighting to bring it back.

Though Uber and Lyft say they’re leaving, ride-hailing app GetMe had previously stated it would remain in Austin if Prop. 1 failed. While drivers for Uber and Lyft will be out of work come Monday, Mayor Adler told the Daily Dot that he hopes drivers would migrate to other ride-hailing applications.

“Frankly, I think we were innovating a little too quickly for Uber and Lyft. They’re big companies and sometimes they’re not quite as nimble as maybe you’d like, and now I think this might give us as a chance for all of us to catch up with each other,” Adler said. “Ultimately, cities cannot abdicate their responsibilities in respect to safety. … I hope we can partner with the private sector to figure out what the intersection should be between government and business as economies and governments change.”

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*First Published: May 8, 2016, 12:05 pm CDT