Likely Increase in Taxi Fares
The first hints that a possible taxi fare increase is coming was released yesterday. Already, there are many people complaining about it in the various online community forums. The reasons for the complaints are varied, ranging from the recent re-election of the PAP government to taxi companies profiteering from the increase instead of benefitting the taxi drivers who need the increase most.
Regardless of all the online complaints that are being voiced, the fares will still be raised eventually. Not that the taxi companies do not know that consumers are unhappy about fare increases, who is willing to pay more when given a choice, but that companies understand the economics at play.
The greatest users of taxi services are those who can afford it by virtue of higher income or reimbursement from their company. This increase is but a drop in the ocean for them since it does not hit their monthly disposal income significantly. The complaints that are being voiced arise mainly from those who are not frequently taking taxis, people such as students, retirees, NSFs, etc. The possible taxi fare increase will only dent their pockets slightly more on the few occasions that they hail a taxi, most of the other times, they will still relay on the considerably cheaper and equally trustworthy public buses and MRT.
Personally, I am fine with taxi fare increases as I do not expect it to hit me hard and taxi drivers have been extremely squeezed with soaring diesel prices. The MRT and buses are still my preferred modes of transport. However, the facts stand that usually taxi companies make use of such fare increases to justify increasing the rental fares of taxis. When that happens, the increases in fare no longer benefit our taxi drivers who had been facing difficulties since the prices of diesel soared. Instead, it will go towards boosting the bottomline of our already profitable transport companies and another year of solid increasing profits. Guess it will all be up to ComfortDelGro, the largest owner of the local taxi fleets, to set the directions... Will it be profits that matter or are they going to take care of the taxi drivers who had been slogging their guts out to try to make a living?
For those who love complaining about price increases, why stop at complaining? Do something about it! Public protests in Singapore are illegal without the neccessary permits but there is a legal way to go about it. Simply vote with your wallets if you are unhappy with the fare increases. If the ridership for taxis fall dramatically after the price increases, the laws of economics will come into play and force a price drop in order to stimulate demand... Unless some top management in the taxi companies know zilch about economics and keep trying to up the fares in the face of declining ridership.
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Taxi fares likely to go up soon
By Christopher Tan and Tracy Sua
TAXI fares look likely to rise from as early as next month, as cab operators prepare to carry out the first major adjustment in years to counter the sharp rise in diesel prices. According to sources, three main fare components will be tweaked.
Firstly, the flag-down rate - unchanged at $2.40 for 12 years - is likely to rise to at least $2.50. Flag-down was supposed to have risen to $2.60 in 1998, but cab companies held back because of the Asian financial crisis.
Next, the surcharge for morning and evening peak hours could be doubled to $2.
Finally, the time and distance formula will be adjusted upwards.
The Public Transport Council (PTC) confirmed that it has been informed by some taxi operators that they intend to revise their fares.
Unlike train and bus fares, taxi charges are not regulated. But cab operators still have to inform the PTC of any fare changes and must publicise the changes at least one week in advance.
Industry observers said cab companies have been wanting to adjust fares from as far back as 2004, when the price of diesel started to escalate, but were waiting for ComfortDelGro Corp - which controls three-quarters of the 22,000 taxis here - to make the first move.
It has been an expensive wait. Diesel is currently $1.233 a litre at public kiosks, almost double what it was in 2004.
'As a small player, we cannot be the first to increase, or people will boycott our cabs,' SMRT Corp president Saw Phaik Hwa once said.
'We can only follow.'
Transport giant ComfortDelGro would not comment, but some of its rivals believe it will make a formal announcement by next Monday.
Smart Automobile managing director Johnny Harjantho said: 'To me it is necessary because drivers themselves are bearing the burden of fuel prices.'
Mr C. K. Chan, 52, who has been a cabby for 15 years, said two years ago he had to pay $15 for fuel for an eight-hour driving shift. Now, he pays $35 and has to drive longer hours to cover the extra costs.
'Before, diesel was cheaper so we could keep driving around looking for passengers, but now sometimes we can drive for 50km to 100km with no passengers.'
PTC chairman Gerard Ee said: 'If drivers get to benefit from the fare change then it is fair. Taxi drivers are like you and me, they have families to take care of.'
But higher fares may not necessarily benefit cabbies.
For one thing, consumer reaction is hard to predict. It may be that many commuters will turn away from using taxis if they feel taxis are too expensive.
However, Mr Ee said that closing the gap between flagging down a cab and calling for one could mean it is 'psychologically less painful for the commuter to call for a cab'.
Companies also often respond to fare hikes by raising cab rental rates, which could cut into cabbies' extra earnings.
Member of Parliament Ong Kian Min, who chairs the Government Parliamentary Committee for Transport, said that some drivers are concerned the fare hike may keep customers away.
Fair increases, he says, are unlikely to be welcomed by commuters but he added: 'If changes are made to the fare structure I hope to see an improvement in service...commuters are very concerned about not being able to get taxis during peak hours.
'When they most need a cab they can't get it.'
Regardless of all the online complaints that are being voiced, the fares will still be raised eventually. Not that the taxi companies do not know that consumers are unhappy about fare increases, who is willing to pay more when given a choice, but that companies understand the economics at play.
The greatest users of taxi services are those who can afford it by virtue of higher income or reimbursement from their company. This increase is but a drop in the ocean for them since it does not hit their monthly disposal income significantly. The complaints that are being voiced arise mainly from those who are not frequently taking taxis, people such as students, retirees, NSFs, etc. The possible taxi fare increase will only dent their pockets slightly more on the few occasions that they hail a taxi, most of the other times, they will still relay on the considerably cheaper and equally trustworthy public buses and MRT.
Personally, I am fine with taxi fare increases as I do not expect it to hit me hard and taxi drivers have been extremely squeezed with soaring diesel prices. The MRT and buses are still my preferred modes of transport. However, the facts stand that usually taxi companies make use of such fare increases to justify increasing the rental fares of taxis. When that happens, the increases in fare no longer benefit our taxi drivers who had been facing difficulties since the prices of diesel soared. Instead, it will go towards boosting the bottomline of our already profitable transport companies and another year of solid increasing profits. Guess it will all be up to ComfortDelGro, the largest owner of the local taxi fleets, to set the directions... Will it be profits that matter or are they going to take care of the taxi drivers who had been slogging their guts out to try to make a living?
For those who love complaining about price increases, why stop at complaining? Do something about it! Public protests in Singapore are illegal without the neccessary permits but there is a legal way to go about it. Simply vote with your wallets if you are unhappy with the fare increases. If the ridership for taxis fall dramatically after the price increases, the laws of economics will come into play and force a price drop in order to stimulate demand... Unless some top management in the taxi companies know zilch about economics and keep trying to up the fares in the face of declining ridership.
-----------------------------------------
Taxi fares likely to go up soon
By Christopher Tan and Tracy Sua
TAXI fares look likely to rise from as early as next month, as cab operators prepare to carry out the first major adjustment in years to counter the sharp rise in diesel prices. According to sources, three main fare components will be tweaked.
Firstly, the flag-down rate - unchanged at $2.40 for 12 years - is likely to rise to at least $2.50. Flag-down was supposed to have risen to $2.60 in 1998, but cab companies held back because of the Asian financial crisis.
Next, the surcharge for morning and evening peak hours could be doubled to $2.
Finally, the time and distance formula will be adjusted upwards.
The Public Transport Council (PTC) confirmed that it has been informed by some taxi operators that they intend to revise their fares.
Unlike train and bus fares, taxi charges are not regulated. But cab operators still have to inform the PTC of any fare changes and must publicise the changes at least one week in advance.
Industry observers said cab companies have been wanting to adjust fares from as far back as 2004, when the price of diesel started to escalate, but were waiting for ComfortDelGro Corp - which controls three-quarters of the 22,000 taxis here - to make the first move.
It has been an expensive wait. Diesel is currently $1.233 a litre at public kiosks, almost double what it was in 2004.
'As a small player, we cannot be the first to increase, or people will boycott our cabs,' SMRT Corp president Saw Phaik Hwa once said.
'We can only follow.'
Transport giant ComfortDelGro would not comment, but some of its rivals believe it will make a formal announcement by next Monday.
Smart Automobile managing director Johnny Harjantho said: 'To me it is necessary because drivers themselves are bearing the burden of fuel prices.'
Mr C. K. Chan, 52, who has been a cabby for 15 years, said two years ago he had to pay $15 for fuel for an eight-hour driving shift. Now, he pays $35 and has to drive longer hours to cover the extra costs.
'Before, diesel was cheaper so we could keep driving around looking for passengers, but now sometimes we can drive for 50km to 100km with no passengers.'
PTC chairman Gerard Ee said: 'If drivers get to benefit from the fare change then it is fair. Taxi drivers are like you and me, they have families to take care of.'
But higher fares may not necessarily benefit cabbies.
For one thing, consumer reaction is hard to predict. It may be that many commuters will turn away from using taxis if they feel taxis are too expensive.
However, Mr Ee said that closing the gap between flagging down a cab and calling for one could mean it is 'psychologically less painful for the commuter to call for a cab'.
Companies also often respond to fare hikes by raising cab rental rates, which could cut into cabbies' extra earnings.
Member of Parliament Ong Kian Min, who chairs the Government Parliamentary Committee for Transport, said that some drivers are concerned the fare hike may keep customers away.
Fair increases, he says, are unlikely to be welcomed by commuters but he added: 'If changes are made to the fare structure I hope to see an improvement in service...commuters are very concerned about not being able to get taxis during peak hours.
'When they most need a cab they can't get it.'
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