SMRT raising fares of some taxis

Taxi fares are increasing as expected. Will we see more? Will owing transport companies be a good hedge against transport cost inflation?

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A Straits Times Article (12 Dec 2013)

TAKING a ride in an SMRT taxi could cost a third more from Monday.

In the latest series of taxi fare changes, SMRT Corp is upping the flagdown fares of all its Chevrolet Epica cabs to $3.60.

Distance fares of its Mercedes-Benz, London, Hyundai Starex and Ssangyong Rodius cabs go up to 30 cents for every 400m travelled for up to 10km, every 350m after 10km and 45 seconds of waiting time.

Previous rates were $3.40 and 22 cents respectively.

The changes take effect from Monday and could mean the cost of trips in these cabs being around 30 per cent costlier compared to existing fares and also what some competitors charge.

Besides Mercedes and multi-seater taxis, the rate for most other cabs is 22 cents per 400m.

SMRT, the third largest taxi operator, last posted new rates when it launched its fleet of Toyota Prius hybrid cabs in October.

Its petrol-electric cabs have a flagdown fare of $3.80, higher than the $3.50 to $3.70 competitors charge for similar taxis.

A company spokesman said the changes were to "keep pace with current rates in the industry".

There are about 30 types of cabs in Singapore, with more than 10 different flagdown fares, three different metered fare structures, more than 10 different types of surcharges and eight types of phone booking charges.

Fares, deregulated since 1998, have been rising in recent years on the back of higher taxi rental rates, which operators attribute to higher certificate of entitlement (COE) prices.

But an industry source said that rises in COE premiums - which have climbed from around $50,000 two years ago to around $73,000 today - are not a valid reason.

"The increase in COE translates to only about $10 per day per cab over its seven-year lifespan," he said. "Rental rates for many cabs have gone up from less than $120, to $135 or more per day - even for cabs bought with much lower premiums."

With SMRT's hike, other firms are poised to follow, although no operator would admit it.

Market leader ComfortDelGro Corp, which runs Comfort and CityCab taxis, said it does not comment on taxi fare changes until they take place.

Trans-Cab and Premier Taxi said they had no plans to adjust fares at the moment.

Prime Taxi, the smallest player, said there had been discussions about raising fares, but "we are watching the situation" before deciding.

Commuter H.Y. Loh said that she will now take cabs "sparingly".

 

"Now that bus services have improved, I will take cabs only when it rains, I have lots of shopping or am travelling to a faraway place that I'm not familiar with," the 58-year-old professional said.