Fuel hikes may add to price of taxi rides
By Li Jian (China Daily)
Updated: 2004-11-12 00:26

Shanghai government is considering an increase in the price of taxi rides due to rising fuel price .

The city's communications bureau will hold a meeting later this month or early next month with representatives from government, taxi companies, drivers and other experts to discuss the issue.

If the price hikes pass, taxi passengers will pay 10 yuan (US$1.2) for 3 kilometres they pay now, but the fee will cover only 2.5 kilometres of travel.

Meanwhile, calling for a taxi online or by telephone will also be subject to a charge.

"Hikes in fuel prices have increased costs to taxi drivers. It has taken profits away from taxi companies," said Bian Baiping, an official of the bureau.

The city has experienced three big fuel price adjustments just this year.

"We are not sure if the price adjustment will work to lower the costs to drivers, because the higher prices may reduce the number of the passengers," said Meng Zuyao, vice-general manager of the Shanghai Qiangsheng Taxi Company.

Some taxi drivers share the same worry.

"It is not a good idea to raise the taxi fare. If there are fewer passengers, our losses will be bigger than those caused by the fuel price rises," said Zhang Jianguo, a taxi driver at the Shanghai Dazhong Taxi Company.

The worries may be apt.

According to a survey by Shanghai-based Market-Expert Marketing Research Company, half of 245 citizens sampled do not agree with the taxi fare increases and nearly 40 per cent said they would refuse to take rides if the fares rise.

Experts warn the potential reductions in passengers may worsen the situation and suggest that taxi companies should help shoulder the burden instead of placing all the hardships on the taxi drivers and the passengers.

"We have several different regulations on taxi fares being discussed now. The taxi companies, taxi drivers and the passengers should shoulder the burden together. The government attaches great importance to the problem and we are open to any suggestions and ideas," said Bian.

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