DMV says UberX, Lyft drivers need commercial plates

In this file photo, a Lyft car drives crosses Market Street in San Francisco. The California DMV has retracted its request for ride share service drivers to obtain commercial license plates. In this file photo, a Lyft car drives crosses Market Street in San Francisco. The California DMV has retracted its request for ride share service drivers to obtain commercial license plates. Photo: Jeff Chiu, File Photo Photo: Jeff Chiu, File Photo Image 1 of / 9 Caption Close DMV says UberX, Lyft drivers need commercial plates 1 / 9 Back to Gallery

The California Department of Motor Vehicles said drivers for UberX, Lyft and Sidecar must obtain commercial license plates — a major threat to the booming app-based ride-hailing companies.

“Any passenger vehicle used or maintained for the transportation of persons for hire, compensation or profit is a commercial vehicle,” the DMV wrote in an advisory dated Jan. 5. “Even occasional use of a vehicle in this manner requires the vehicle to be registered commercially.”

The ride companies and their trade groups vigorously denounced the DMV’s memo, which would build roadblocks for their thousands of drivers.

Quick driver sign-ups are crucial to the companies’ growth. Commercial registration for cars is only slightly more expensive than personal registration, but it is a hassle. It entails an array of paperwork, including certification of a car’s weight, and an in-person DMV appointment. It probably would necessitate carrying commercial insurance, which is much more expensive than personal auto insurance.

And the companies say the DMV’s position undermines existing regulation from the California Public Utilities Commission, which even defines the services as entities that use an online platform “to connect passengers with drivers using a personal vehicle.”

“Requiring Lyft drivers, including those who drive just a few hours a week, to get commercial plates would essentially treat peer-to-peer transportation the same as a taxi, undermining the thoughtful work done by the CPUC to craft new rules for ride-sharing in California,” Lyft said.

The DMV said an increasing number of questions from dealers and customers prompted the memo, which clarified an existing state law that dates from 1935. It sent the notice to thousands of auto-related businesses, including car dealerships and the various ride companies, said spokesman Artemio Armenta.

However, it’s not clear how vigorously the DMV, the California Highway Patrol or local police will enforce the requirements. CHP spokesman John Harris said officers who noticed the lack of commercial plates — which resemble personal plates but start with different characters — could issue citations for registration violations, just like expired registration citations.

The California Uniform Bail Schedule shows that penalties range from $25 to $285, but it’s a “fix-it ticket” — meaning drivers who correct the violation by the due date on their ticket pay $25, according to the San Francisco Superior Court.

Ride-hailing companies have a history of flouting regulations. Before California became the first state to legalize them in 2013, they operated in defiance of cease-and-desist orders from the state and some cities. Likewise, they have expanded into cities nationwide, and internationally in the case of Uber, even when existing laws bar their services.

Two assemblywomen, Ling Ling Chang, R-Diamond Bar (Los Angeles County), and Kristin Olsen, R-Modesto, on Friday bashed the DMV’s stance in a letter to the agency and the CPUC. “This borders on the nonsensical,” they wrote, saying they will introduce legislation to amend the California Vehicle Code if the DMV doesn’t change its position by Feb. 17.

Uber and Lyft have seen rapid-fire adoption by riders and drivers in just over two years. Uber, which is far bigger, has nearly 50,000 drivers in the state, according to a report it released Thursday, with more than 20,000 in Los Angeles, 16,000 in San Francisco and about 5,000 each in Orange County and San Diego. Lyft’s numbers aren’t available.

“The California Public Utilities Commission allows (ride-hailing) drivers to use personal vehicles with personal registration on the UberX platform,” Uber said, adding that Gov. Jerry Brown’s signing of a bill regarding insurance for the companies showed him affirming that drivers may use personal vehicles.

BuzzFeed last month reported that Uber’s leasing and car-buying programs encouraged drivers to register their vehicles for personal use. This week, it reported that Uber had jettisoned at least a dozen drivers who registered their cars as commercial vehicles.

Uber denied those allegations. “How a driver registers his/her vehicle is up to that driver,” the company said. “Uber does not require a driver to register his/her vehicle as personal, and it is not our policy to deactivate a driver for registering his/her vehicle as commercial.”

Carolyn Said is a San Francisco Chronicle staff writer. E-mail: csaid@sfchronicle.com Twitter: @csaid