How will cab
fare hikes help?
SINGAPORE : A day after ComfortDelGro announced what some say is
the biggest overhaul of the fare structure to date, other taxi
companies have taken the first step to adjust their meters
too.
Smart Taxis, with 800 vehicles, is aligning its new fare structure
with that of the market leader. Besides raising meter fares, Smart
said it would triple the city area surcharge and impose a
35percent peak period premium to replace the flat
surcharge.
The companys managing director Johnny Harjantho told TODAY that
ComfortDelGros new pricing structure, which will kick in next
Monday, is reasonable. If we do anything different or cheaper,
we may not please our hirers or our commuters. It is best we retain
a universal price.
Smart, which notified the Public Transport Council (PTC) on Tuesday
of its move, said the new fare structure will take effect on
Christmas Eve.
SMRT, the second largest company here with 3,000 taxis, also
notified the PTC about a fare adjustment. A SMRT spokesperson was
tightlipped about details, only saying that it would release them
early next week.
Meanwhile, Premiers managing director Lim Chong Boo said the
operator was still considering and would make known its decision
soon. New player Prime has said it would not raise fares for three
months.
ComfortDelGro, which operates 15,000 taxis here, announced its new
pricing structure on Monday designed to address both cabbies
soaring operating costs and the dearth of taxis during peak hours.
Passengers will pay between 10 and 49 per cent more.
The operator said this would differentiate taxi services from
public transport services like bus and rail which do not offer
customers a pointtopoint dedicated service.
But observers TODAY spoke to are divided on whether a price
increase alone would allow taxis to pull away from buses and trains
as recognised public forms of transport.
Mr Han Songguang, a transport researcher at the National University
of Singapore, argued that the fare adjustments are simply measures
to manage consumer behaviour on the assumption that the demand is
pricesensitive.
But, he noted, much of the demand for taxis is not so tired
whitecollar workers going home after a long days work, people
carrying bulky items or many shopping bags, or partygoers. And for
them, taxis fill the need for a pointtopoint form of public
transport, which buses and trains do not provide.
Mr Cedric Foo, chairman of the Government Parliamentary Committee
(GPC) for transport, called for public transport to be further
improved by keeping fares affordable while upping the level of
service.
While the Government works on building a more extensive rail
network, meanwhile, premium buses and express buses can help meet
the need for better public transport coverage, Mr Foo added.
There are also concerns as to whether the new fare structure will
benefit taxi drivers, who gripe about escalating operational
costs.
With the general fare to increase by at least 10 per cent, there
are marginal benefits for cabbies, said NUS don Lee DerHong but
they would benefit more if they switched to alternative fuels such
as liquefied petroleum gas, to escape the hike in diesel prices, he
argued.
Mr Ong Kian Min, deputy chairman of the transport GPC, postulated
that if the 10percent general increase deterred passengers from
taking taxis, it might result in a glut of taxis during offpeak
hours.
Hence, he suggested that taxi operators come up with different
flagdown rates instead that could help taxi drivers garner more
passengers during offpeak periods.
Some observers hoped that smaller operators could be more
creative in their pricing strategies, instead of simply copying
ComfortDelGro, to give commuters a choice.
But Mr Harjantho summed up the dilemma facing an operator with a
small fleet: Lower the price, and a passenger may still not bother
to wait for a Smart taxi to arrive; raise the flagdown fare but
keep surcharges lower, and passengers may boycott Smart
taxis.
In this industry, ComfortDelGro is still the leader. There is no
way we can adjust our fares according to what we want, he said.
TODAY/il
