The taxi industry should be allowed to
innovate and adapt to new market conditions and competition, Second
Minister for Transport Ng Chee Meng told Parliament yesterday.
Mr Ng's comments were a strong hint that taxi companies
would soon get the go-ahead to use dynamic pricing as another
option for booked trips.
ComfortDelGro, which controls over 60 per cent of cabs
here, told the Public Transport Council (PTC) last week of its plan
to introduce dynamic, or surge, pricing - similar to that used by
third-party car hailing companies Uber and Grab.
Trans-Cab, Premier Taxi and Prime Taxi have also
informed the PTC of similar plans.
The PTC is in discussion with the taxi companies, said
Mr Ng.
Chua Chu Kang GRC MP Zaqy Mohamed said commuters are
now faced with a "double whammy" of fare uncertainty and taxi
availability.
Pointing out that the Taxi Availability framework,
which requires taxi companies to clock a minimum daily mileage, was
scraped last year, he asked: "How can the ministry ensure that the
public will be adequately served?"
Mr Ng said he understood some commuters' concerns about
dynamic pricing but said they would know exactly how much their
fare would be and can choose to accept or decline.
"The taxi companies, I understand, intend to retain the
traditional metered fare system even as they introduce dynamic
pricing. But ultimately, taxi companies should ensure that dynamic
pricing improves, and not worsens the matching of supply to
demand," he said.
Transport experts think that surge pricing, which kicks
in only when demand is high, will likely push up taxi fares,
especially during peak periods.
SIM University economist Walter Theseira said: "Demand
would probably be higher during peak periods, where there are
currently surcharges.
"While it depends whether taxi companies can
comfortably meet demand during these periods, it is unlikely they
would want to bring down the current prices."
He is concerned that elderly people who do not know how
to use apps to get a taxi might find it more difficult to hail one
on the street.
UniSIM adjunct associate professor Dr Park Byung Joon,
a transport expert, also thinks that fares are likely to go up.
He said: "During non-peak periods, private hire cars
are only slightly cheaper than taxis, but they can be much more
expensive during high demand.
"If you average it out, it would probably be more
expensive for taxis using surge pricing."
Government Parliamentary Committee for Transport
chairman Sitoh Yih Pin said technology had disrupted the industry
and provided more options and value for commuters, but he also
highlighted the difficulties faced by taxi drivers.
He added: "I do not advocate protectionist policies for
our taxis. But in a reasonably short period, three events and their
corresponding policies are likely to have repercussions on the
livelihoods of taxi drivers.
"They are the entry of private hire cars, the
restructuring of diesel tax and the push for automated driverless
cars."
TNP
jiang efficient worrrrrr
