Drive For More Cabs Hits Skids

Frontier Centre, Regulation, Transportation, Uncategorized, Worth A Look

An independent consultant’s report on the Winnipeg taxi business is likely to slam the door on the prospects of a significant influx of new cabs onto the streets of Winnipeg.

Sources familiar with the report, to be released this morning by the Manitoba Taxicab Board, say while it might recommend more winter seasonal cars be licensed and for longer periods of time, it otherwise endorses the adequacy of the current system.

The report was commissioned by the taxicab board because of a groundswell of applications for new licences last spring by a newly formed driver co-op and Spring Taxi, the third-largest taxi company in the city. Since that time, a flurry of demand for new licences has driven up the number of applications to the board to more than 800.

The co-op concept was motivated by long-standing complaints about working conditions voiced by drivers who do not hold their own taxi licence.

Public complaints about poor service have plagued the industry’s reputation for some time.

The review was produced by the Tennessee Transportation and Logistics Foundation, headed up by Ray Mundy, a University of Missouri St. Louis transportation specialist.

Sources said the study will generally uphold the current system that is dominated by two large computer-dispatched companies whose members own 91 per cent of the 410 standard cabs in the city.

The quasi-judicial provincial taxicab board regulates the industry by issuing licences, regulating fares and ensuring safety standards.

The board has made it clear it will use the recommendations in the consultant’s report to determine whether it should issue new licences and how many.

It is not expected to make its decisions on the current round of licence applications until sometime next month.

The board’s mandate is to ensure Winnipeggers receive quality taxicab service that meets the public need at reasonable cost through the administration of a system of economic regulation.

Incumbent operators have generally opposed the addition of any new cars on the road, claiming existing cabs are not busy enough as it is.

Sources said the report will back up the incumbents’ claims that 80 per cent of calls are serviced within 10 minutes and 90 per cent within 15 minutes.

But critics of the industry, and those seeking to break into the business, say there should be more freedom for new entrants to make a go of it. They say it will create better efficiencies, better service and perhaps lower costs.

Barry Prentice, a transportation and logistics expert at the University of Manitoba, said those who argue that ending taxi regulation could lead to a breakdown in the industry have no examples to back up that claim.

“Destructive competition is always trotted out as being a consequence of an unregulated taxi business, but there are no examples to prove it,” Prentice said.

He points to the deregulation of the trucking industry and open skies in air transportation as indications deregulation in the transportation business works.