Can Cargo Bikes Solve A City’s Transportation Issues?

DHL, earlier this month,  announced it is rolling out its Cubicycle in New York City, participating in a pilot program to test the use of cargo bikes to alleviate traffic congestion as well as lessen air and noise pollution in the city's crowded streets. The pilot program encourages all freight companies to use cargo bikes on city streets during an initial six-month trial period. The initial participants are DHL, Amazon and UPS and as many as 100 bikes will be deployed in Manhattan's Central Business District south of 60th Street.

The City's Department of Transportation will collect information about speed, parking, use of bike lanes and the size of the bikes to determine if they are an efficient option to help relieve traffic congestion. "Cargo bicycles will play an important role in hitting our environmental targets," said Mike Parra, DHL Express Americas CEO. The company's goals include achieving net zero emissions from transport activities by 2050 and performing at least 70% of pick-ups and deliveries with green energy solutions such as electric vehicles and bikes by 2025.

"The DHL Cubicycle has enjoyed great success in Europe, with each bicycle deployed taking at least one conventional delivery van off the road, helping to relieve congestion and increasing our service levels," said Parra. The New York Department of Transportation is in full support of this program.  "With trucks involved in a disproportionately high number of cyclist fatalities in New York City this year, we are especially interested in the safety benefits this pilot can bring to our streets," said NYC DOT Commissioner Polly Trottenberg The Cubicycle has several features that make it attractive for delivery operations in heavy traffic areas: a reclining seat that provides greater comfort, safety and speed for the courier; electric pedal assistance for additional speed and support in climbing hills and making it easier to handle within a tight turning radius.

The removable containers are secure, waterproof and offer large capacity for packages but are low enough to the ground so as to not impair the view of other cyclists on the road. They can be equipped with GPS transmitters to facilitate real-time shipment tracking and monitoring for security purposes. The bikes are also self-powered through the use of solar panels.

By replacing a conventional delivery vehicle, each deployed Cubicycle is expected to reduce carbon emissions by up to eight metric tons per year. The bikes reduce the use of energy by up to 90% compared to electric vans and even more when compared to vehicles with internal combustion engines. DHL has been an early adopter of using bikes as an alternative delivery option in crowded city centers.

First introduced in 2015 in the Netherlands, the Cubicycle now is being used in Germany, Belgium, Hong Kong and Singapore. DHL has about 85 cargo bikes in its ground fleet globally, including Cubicycles and a smaller Parcycle, a two-wheel bike with a cargo box. This pilot program will be the first use of the Cubicycle in the U.S.

In the U.S., DHL maintains an alternative fuel vehicle (AFV) fleet, which includes fully electric, hybrid-electric, compressed natural gas (CNG) and clean diesel. In 2011, the company put in place an all-green fleet in Manhattan fully comprised of electric and hybrid vans. Earlier this year, it announced that it was adding 63 NGEN-1000 electric delivery cargo vans that would be rolled out in the San Francisco Bay area and Long Island City, N.Y. 

If you run a business and think you have it hard, when you consider what Uber is going through this Christmas season you might not feel so bad--unless you too rely on independent contractors to get work done. In that case, you could end up facing the same whirlwind soon enough. The most recent example of the war on independent contractors is the state of New Jersey hitting Uber with an assessment for £650 million in back-due unemployment and disability insurance contributions and interest, holding that its drivers were really employees, not contractors.

You read that number right: £650,000,000. New Jersey Labor Commissioner Robert Asaro-Angelo said the state "is cracking down on employee misclassification because it stifles our workforce and inflicts a huge financial toll on our economy." The ride share service is expected to fight the assessment in the court system, although at this point its prospects of succeeding don't look good. "We are challenging this preliminary but incorrect determination, because drivers are independent contractors in New Jersey and elsewhere," declared Uber spokeswoman Alix Anfang.

But no matter what it does, the company is unlikely to prevail, according to attorney Mark E. Tabakman of the law firm of Fox Rothschild LLP. He says Uber probably will seek an informal meeting with state Department of Labor (NJDOL) officials, including someone titled the Redetermination Auditor, to see if it can cut a deal. "The reality is that the DOL will never agree that all (or any) of these individuals are independent contractors and Uber will likely never concede that any of them are employees because that would have nationwide consequences."

Even if the NJDOL agrees to cut the assessments down to nominal, nuisance value amounts, Uber would be compelled to treat all of its New Jersey drivers as statutory employees going forward, something that Tabakman asserts the company will never do voluntarily. He says a further cruel irony awaits Uber, or any putative employer pursuing the same course of action. If the company cannot cut an acceptable deal with the Redetermination Auditor, the case will proceed to trial in the Office of Administrative Law (OAL), before a neutral Administrative Law Judge (ALJ), who is not an NJDOL employee.

"Even if the company completely prevails before the ALJ, the Commissioner of Labor, the head of the agency that the company has just beaten, then has 45 days to sustain, modify or reverse the ALJ decision," Tabakman points out. "Any bets as to which option the commissioner would choose?" Uber then could choose to pursue the case through the New Jersey court system, starting with the Appellate Division. However, as Tabakman notes, those courts greatly defer to the position and decision of a state agency. "Thus, it is very dangerous to take a case to OAL because even if you win, you may well, in the end, lose."

Even in the absence of the NJDOL assessment, it looks like the future holds no joy for Uber, or anyone else who uses independent contractors in New Jersey, because it seems almost certain the state legislature and governor will enact legislation next year mirroring a new California law, which makes it virtually impossible for any worker to be classified as a contractor in that state as of Jan.

1. In California, Uber along with Lyft and DoorDash have mounted a campaign to have a referendum placed on next November's ballot that, if the voters approve, would exclude their drivers from the new law. For years, Uber also has been fighting attempts by states and some municipalities to upend its independent contractor business model.

But with New Jersey and other states getting ready to adopt their own versions of California's law, that could end up being nothing more than a forlorn hope.

"The end result, potentially, is that Uber has to change its business model or create some indicia of true employment," Tabakman suggests.

Others have estimated that ending drivers' contractor status would be increase Uber and Lyft's labor costs by 20-30%.

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