South Africa’s Competition Commission has suggested that certain rules be removed from the country’s National Land Transport Act to allow healthier competition in the taxi industry.
These changes are intended to facilitate better competition between metred taxis and ride-hailing services such as Uber and Taxify.
So what changes does the competition watchdog believe will improve things? For starters, the fact the driver’s utilising ride-hailing services aren’t licenced as strictly as metred taxis is a major concern. Approximately 35-55% of Uber drivers in SA are said to be operating without an area-based operating licence with 70%-95% of Bolt drivers (another uber-like service) operating without valid licencing.
This causes trouble because ride-hailing services because metred taxi drivers believe their customers are being poached by ride-hailing services who can connect with the nearest passenger even when that passenger isn’t in the municipal boundary.
At an operational level, metered taxis comply with the legislative restrictions imposed on their licences and operate within the defined radiusProvisional report on e-hailing and metred taxis
Another concern has to do with uber’s pricing advantage which is as high as 250% for shorter trips and is still around 50% for trips as long as 50km:
The report suggests that pricing regulations for metred taxis should be removed.
They also suggested that area restrictions be scraped seeing that they no longer work when competitors relying on technology now have such an advantage:
Area restrictions reduce competition and their rationale is incompatible with the evolving nature of digital markers and may constrain both e-hailing operators and metered taxi operators
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