Revel started out in 2018 with shared, dockless e-mopeds in Brooklyn, which later expanded to Queens, Manhattan, the Bronx and a handful of other U.S. cities. This year, the company launched a monthly e-bike subscription in New York City and announced plans to build an electric vehicle charging hub in Bed-Stuy. Now, Revel is introducing an all-electric — and all-Tesla — rideshare service in Manhattan.
What once seemed like a company with an identity crisis dabbling at random with different forms of mobility is starting to come together as a calculated strategy to own the electrification infrastructure of cities, starting with NYC. This has been founder and CEO Frank Reig’s war cry from the start.
“From day one, our mission has been to electrify cities,” Reig told TechCrunch. “We do that by providing electric transportation options needed in cities, as well as building the electric vehicle infrastructure needed to make that happen.”
The new rideshare venture, which will launch in late May with a fleet of 50 Revel-branded Tesla Model Ys, is the natural next step in the process of working toward “electrifying every single trip in a city,” says Reig. Customers will be able to access ride-hailing services with the same app used to book e-mopeds. The launch will begin in a zone below 42nd Street, and will expand to additional neighborhoods based on demand and data from the initial phase, according to the company.
Revel’s rideshare launch is taking a similar approach to its initial moped launch three years ago, starting in a small area and slowly growing toward an overall goal of serving the entire city, according to co-founder Paul Suhey.
The company is still in the application process to become an approved operator with NYC’s Taxi & Limousine Commission. Revel says its initial application was approved, but there are a few more steps to acquiring a fully issued license, such as associating a minimum of 10 vehicles with its newly formed TLC base license number.
The TLC issued a cap on for-hire vehicles, but wheelchair-accessible and electric vehicles are exempt. While Revel seems legally within its rights to be issued a license in time, TLC Commissioner and Chair Aloysee Heredia Jarmoszuk doesn’t see it that way.
“TLC capped for-hire vehicles because supply already exceeds demand,” she said in a statement. “The electric battery exemption exists to encourage already-licensed cars to go green, not to flood an already saturated market or to disenfranchise the Yellow Taxi sector in Manhattan. This ride-share scheme deviates from the spirit of those rules, and TLC will not cut corners in doing its full diligence.”
Reig responded by doubling down. “The TLC licensing process is not a discretionary process and we do not anticipate having any issues complying with all TLC rules and regulations,” he said. “While the TLC has paused issuance of new licenses for gas-powered cars, our fleet of all-electric Tesla Model Y vehicles qualifies for licenses under the TLC’s Battery Electric Vehicle exception, which the TLC renewed earlier this year. Our ability to operate doesn’t depend on the Commissioner’s opinion — it depends on us taking the steps laid out by law to complete the administrative licensing process, which we’ve done since the start. Right now we are exactly where we need to be as we look towards putting Revel rideshare vehicles on the road in May.”
Suhey said one of the reasons Revel is beginning to launch its rideshare service right now, instead of waiting until everything is officially licensed is because it’s employing drivers.
“When it comes to employing drivers, we need to get the word out. We need to be able to recruit and retain drivers now,” Suhey told TechCrunch.
Revel’s customer rates will be on par with competitors like Uber and Lyft, Reig says, but rather than relying on gig economy workers, the company intends to hire all of its drivers.
“For the same price, you’re able to get into a fully electric vehicle with a company that actually employs New Yorkers and doesn’t push all the insurance risk and asset depreciation onto New York City residents just trying to make a living,” said Reig.
Paying workers is not just altruism for Revel. It makes more sense to employ drivers because the company needs to own the Teslas, in large part so they can be built to Revel’s specifications. The Model Ys will be painted “Revel-blue” and will include a touchscreen to control cabin conditions like temperature and music. The front passenger seat of the vehicles will be removed to both adhere to COVID-19 distancing guidelines and to allow riders to stretch their legs.
But more importantly, Revel learned a valuable lesson from the $200 million PR campaign from the likes of Uber, Lyft and Postmates to lobby Californians to vote for Proposition 22, a ballot initiative which would make the app-based companies exempt from treating workers as employees with benefits. The initiative passed, but Reig is of the opinion that that money could have gone toward attracting and maintaining a solid workforce, rather than constantly trying to fill the funnel of drivers with a disillusioned labor pool.
“There’s also a safety piece when you’re talking about a fleet,” said Reig. “Because it’s our fleet, we’re able to understand exactly the acceleration, the speed and the braking of the car at all times. Every single driver that we employ and train will be getting safety scores at the end of every shift so they can improve their driving. So now, we’re able to lower insurance costs and liabilities.”
As cities electrify, Revel wants to be the one scaffolding the business models going forward. Offering up a ride-hail is not just about building out a new business line. It’s also about accelerating the production of the company’s charging business. Revel’s trying to establish an electric monopoly while solving for the chicken-and-egg problem of prospective EV buyers who would buy electric if only there were charging stations and planners who would build EV infrastructure if only more people were buying EVs.
“Everything that we do as a company is about trying to drive EV adoption and access to electric mobility in cities,” said Suhey. “People think about that in terms of access to a different mode, whether that’s an electric car, an electric bike, a moped — we’re thinking more broadly about electrification in cities.”
This article has been updated to include information from NYC TLC about the legality of Revel’s service, as well as Revel’s rebuttal.