Experiences with regulatory changes in the taxi industry

1. Experiences with regulatory changes in the taxi industry Jon-Terje Bekken Institute of Transport Economic Norway Thredbo 9, Lisbon jbe@toi.no www.toi.no

2. Conceptual framework • Different market segments • Taxi ranks, hailing, telephone-booking, contracts • Also different size between cities and countries • Different market organisation and competition • PHVs vs Taxis, Centrals vs fleets vs “independent operators” • Differences in the regulations • Different approaches, strengths and combinations • Not easy to make generalisations

3. Entry regulations in Europe. Strict quantity regulation • With strict quality requirements: Norway, (Germany), (Finland), Denmark • With lean quality requirements: Belgium, France, Spain No quantity restrictions • With strict quality requirements: Austria, Sweden, (Germany), (The Netherlands) • With lean quality requirements: (Hungary), Ireland However several have deregulated the last two decades

4. Fare regulation in Europe No fare regulation: • Sweden (centrals), Norway (major cities), UK (some places) Maximum or fixed fares: • Belgium, Finland, Hungary, The Netherlands, Ireland, Norway, Switzerland, UK, Austria, Germany, Ireland, UK (London), France, Denmark

5. The overall trends • Focus on quality regulations not quantity regulations • Maximum fares still retained or strong focus on improved information

6. Trend towards quality standards

7. Some experiences with deregulation • Ireland (entry) • Sweden (fares and entry) • Norway (fares) • The Netherlands (entry and fares)

8. Ireland Entry deregulated - From tradable licences to free market overnight • Increased supply (3x in 2 years) • Increased availability • Reduced utilisation • Increased problems of “unacceptable behaviour” Tightened some quality aspects later

9. Ireland - supply exploded

10. Sweden Deregulated fares and entry in 1990: • Fares increased initially • Supply increased (most in cities) • Reduced utilisation • Increased cost of subsidised trips in rural areas - reduction in cities Tightened many quality aspects later

11. Sweden changes overnight

12. Norway Fares deregulated in major cities • General fare increase • More differentiation (higher night fares lower daytime) • Informational problems Plans to deregulate entry as well

13. The Netherlands • Stepwise deregulation • From regulation on most aspect to “free” market • Increased supply • No increase in demand • Fares still regulated • The stepwise approach worked well

14. The Netherlands – more cabs but smaller companies

16. Deregulation summarized (1) • Increased availability (cities), but reduced utilisation • Reduced waiting time for consumers • Increased costs per trip • Fares adjust, but not necessarily reduced – lack of competition and previously over suppressed • No surprise?? • Fare differentiation (more related to demand) the great advantage

17. Deregulation summarized (2) • Regional differences must be considered • Rural areas no continuous supply curve • Cities with a transparent industry • Metropolitans with externalities • Dispatching Centrals play an important role • Information, recognition, branding, competition • Enforcement, self-discipline • Cost efficient supply – same supply with less taxis

18. Is fare information enough?

19. Comparable fare* € 20,87 € 22,37 € 27,43 - - The Swedish fare information requirements Fares Taxi Stockholm Tariff When? Where? Fares TAXA 1 Weekdays Starting tariff: € 4,50 9-15 + €/km € 0,84 + €/hour € 32,04 TAXA 2 Not covered by Starting tariff: € 4,50 Taxa 1 or Taxa 3 + €/km € 0,99 + €/hour € 32,04 Friday 21 - Saturday 05 TAXA 3 Starting tariff: € 4,50 Saturday 21 - Sunday 05 + €/km € 1,28 Public holidays + €/hour € 40,71 Fixed City Centre to Airport fares Fixed City Centre to Airport fares

20. Fares Comparable fare 0- Weekdays 11-14.30 (Diff 16%) 4km € 20,00 € 23,10 € 24,64 € 28,57 € 32,14 Compareable fare* € 17,26 Weekdays 06-17 (Diff 11%) € 19,17 € 21,90 € 23,33 € 25,95 Compareable fare* € 18,12 € 38,11 € 23,39 Public hollidays Diff (27%) € 24,71 € 24,71 Saturday at 4PM (Diff 29%) € 28,38 € 30,29 Oslo taxi Tariff When? Where? Fares TAXA 1 Weekdays Starting tariff: € 3,69 06-17 + €/km € 1,63 + €/hour € 0,00 TAXA 2 Evening 17-22 Starting tariff: € 4,29 Saturday 06-15 + €/km € 1,88 + €/hour € 0,00 Night Mon-Th (22-06) TAXA 3 Starting tariff: € 4,52 Saturday 15-22 + €/km € 2,01 Sunday 06-06 + €/hour € 0,00 TAXA 4 Weekend night Starting tariff: € 5,24 Friday + Saturday + €/km € 2,33 22-06 + €/hour € 0,00 Fares Taxi 2 - Oslo TAXA 5 Public hollidays Starting tariff: € 5,95 Tariff When? Where? Fares + €/km € 2,62 TAXA 1 Weekday daytime Starting tariff: € 3,57 + €/hour € 0,00 Mon-fri 110-14.30 + €/km (0-4km) € 1,54 + €/km (>4km) € 1,37 TAXA 2 Mon-fri 06-10 Starting tariff: € 4,29 Seeing these kind of schedules – would you ”go shopping”? Mon-fri 14.30-18 + €/km (0-4km) € 2,00 And what about these kind of comparable fares? Saturday 06-18 + €/km (>4km) € 1,49 TAXA 3 Mon-fri 18-24 Starting tariff: € 4,64 Sunday 06-24 + €/km (0-4km) € 2,13 + €/km (>4km) € 1,73 TAXA 4 Mon-fri 00-06 Starting tariff: € 5,24 Friday 18-24 + €/km (0-4km) € 2,35 Saturday 18-24 + €/km (>4km) € 1,81 TAXA 5 Saturday 00-06 Starting tariff: € 5,60 Fares Norgestaxi Oslo Sunday 00-06 + €/km (0-4km) € 2,67 Tariff When? Where? Fares + €/km (>4km) € 2,04 TAXA 1 Weekdays Starting tariff: € 3,81 TAXA 6 Public hollidays Starting tariff: € 6,15 06-17 + €/km € 1,43 + €/km (0-4km) € 2,24 + €/hour € 0,00 + €/km (>4km) € 3,20 TAXA 2 Evening 17-22 Starting tariff: € 4,64 + €/km € 1,88 + €/hour € 0,00 Night TAXA 3 Starting tariff: € 4,88 Saturday-Thursday + €/km € 1,98 22-06 + €/hour € 0,00 TAXA 4 Weekend Starting tariff: € 4,88 Saturday+Sunday + €/km € 1,98 06-22 + €/hour € 0,00 TAXA 5 Weekend night Starting tariff: € 5,60 Friday+Saturday + €/km € 2,28 22-06 + €/hour € 0,00 TAXA 6 Public hollidays Starting tariff: € 5,95 + €/km € 2,43 + €/hour € 0,00