Taxi Startup Revel Forced To Buy Gas Cars Before Tesla Model Y

The New York Taxi & Limousine Commission blocks startup Revel from launching its fleet of 50 Model Y taxis.

revel tesla model y

Steven Loveday

By: Steven Loveday

Jun 23, 2021 at 9:01am ET

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As we've previously mentioned, startup Revel is making plans to launch a taxi and rideshare service using Tesla Model Y crossovers. However, it seems the New York Taxi & Limousine Commission's interesting rules aim to force the company to buy a fleet of gas cars prior to moving forward with its Model Y fleet.

Revel was hoping the commission would approve of its plans since the city made EVs exempt from its taxi and rideshare cap back in 2018. However, New York said it may be removing the cap due to too much traffic.

Fast-forward to a few days ago, June 21, 2021, and the commission issued a new notice that it will no longer accept new licenses for electric taxis. More interestingly, the commission claimed it made the decision at a virtual hearing on June 22, though the notice came out on the 21st, prior to the hearing.

In short, it seemed the decision had already been made, but the hearing was required by New York as a formality. A spokesman from the commission explained the situation and made it clear that the rule change must be posted, but that the decision hadn't yet been made official.

According to the New York Post via Teslarati, New York Taxi & Limousine Commission Chair Aloysee Heredia Jarmoszuk said the commission will not ban Revel from starting its Model Y taxi service. However, she said if the ruling works against Revel, the company could simply buy 50 gas cars first, then remove them from service and replace them with the Tesla crossovers. She shared via Teslarati:

“Just because a car is electric doesn’t mean that adding more cars and more congestion is good for the environment. This is a simple math issue. This is not about targeting a group or saying you can’t enter the marketplace or we don’t like you."

Revel CEO Frank Reig made it clear he thinks this situation would be absurd. Why would the commission require that an EV taxi company buy gas cars first? He also said he's confident Revel will prevail here, and that the law will be on the company's side.

What do you think?

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The commission is also facing scrutiny from lawyers and transportation experts about its unfair policy, as well as the fact that its notice was issued ahead of the meeting where specific decisions were to be made.