Nissan's taxi slap could be you next time
Nissan's taxi slap could be you next time
Nissan's competitors no doubt find it gleeful that just three weeks before the launch of its New York City yellow taxi, the city welched on the deal.
Nissan had envisioned $1 billion in sales from its New York taxi contract. And it might or might not still see that. Nissan dealers have begun selling the taxi there anyway.
But wipe that competitive glee off your faces.
What New York did to Nissan says nothing about Nissan, and way too much about government contracts in the present era. There are certainly other automakers, auto dealers and auto services companies jockeying for a shot at government business somewhere right now.
A few years ago, as an image-building idea for the city, Mayor Michael Bloomberg and city officials formulated a colorfully ambitious "Taxi of Tomorrow" plan. They asked for one standard taxi that would float in yellow fleets across the city like a tourist attraction. It would have to be state of the art, environmental and designed as in taxis of old to be roomy and comfortable.
To offset the expense of creating a low-volume vehicle, the city made the deal exclusive -- all new cab purchases for 10 years would have to be this one Taxi of Tomorrow.
Narrowing the field
The city invited all comers. It narrowed down the candidates to three -- Nissan, Ford and a little-known Turkish company. Public hearings were held to consider the options. Two years ago, the city selected Nissan and its compact commercial van, the NV200.
It would sell only in the low thousands for the next decade, but Nissan assured the public the deal would pencil out and serve as a profit center.
Nissan invested to design the vehicle to meet New York's wishes. It invested to manufacture the taxi in North America. There were r&d costs, marketing costs, corporate costs -- this stuff doesn't just happen by itself.
I was in Manhattan this summer and chatting with my cab driver about the Nissan taxi deal that was still scheduled to go into effect in late October. He was from Somalia and we were riding in a cramped Ford Escape that had been retrofitted as a taxi.
He was very aware of the Nissan Taxi of Tomorrow, and like most cab drivers, opinionated about it in diverse directions.
He said it just wasn't right to require people to buy a single vehicle and not give them a choice in the matter. Nonetheless, he told me, he had seen the Nissan taxi and really liked it. He wanted one, even though it just wasn't right that he didn't have a choice.
The city's political forces have grumbled about it from the get-go. There was this complaint and that complaint. The NV200 would cost too much. But what was cheaper? It didn't meet the city's requirement because it wasn't available as a hybrid -- even though a hybrid version is planned. It didn't meet the city's contract because it was not wheelchair accessible, even though Nissan revealed a plan with Indiana accessibility company Braun Corp. to make the necessary conversions.
This taxi trade group and that owner's association challenged it in court. And in October -- scant days before the Nissan taxi was to launch -- a local court ruled the entire plan invalid.
In the final hammer blow, the court stepped over the hybrid complaint and the wheelchair issue and the other grumblings. It simply ruled that the city agency that had signed the contract with Nissan was not authorized to do so.
Years of planning have gone by while all of this cooked in public. And in the course of three years, no government leader, no attorney for the city, no thoughtful committee of retired judges stepped forward to resolve the legal questions to avert the crash, even though a well-meaning vendor was spending a fortune to comply with its publicly awarded contract.
Nobody was stealing anything. Nobody was sneaking through dark hallways with bags of cash. Nothing about the taxi deal was secret.
Nissan is acting all gracious about this nasty surprise -- the way you might behave if you showed up for a dinner invitation in black tie and tails, presented your invitation, and had the butler slam the door in your face.
What would Fred Astaire do? Sing, probably. Or go get a pastrami on rye somewhere.
Nissan has simply put the taxi on sale anyway, without the benefit of the city's contract, to let the market move forward as it pleases. There is not a lot of singing and dancing about it. My Somalian cabbie can now go buy one if he pleases, now that he has a choice. But the underpinnings of Nissan's contract -- the numbers and assumptions that motivated Nissan to bring him a new taxi in the first place -- have been snatched from the automaker's pockets.
This was a classic New York mugging.
The standard warning to tourists rings true for other hopeful city vendors: Keep your hand on your billfold and be careful whom you talk to.