Taxi fleets seek partnership with ride-hailing platforms amid business challenges

Several taxi fleets are negotiating partnerships with ride-hailing platforms to boost their businesses amid the struggle to achieve scaled operation and the government’s push to legalize ride‑hailing services. 

The government last July issued licenses to five taxi fleets, which were required to achieve a total of 3,500 vehicles within four months of licensing by the end of last November. 

However, according to Secretary for Transport and Logistics Mable Chan, the latest figures showed that the total number is expected to reach only 1,500 by the end of this month, only 43 percent of the required target. 

From the passengers’ perspective, the vehicle and service quality from these fleets is significantly better than that of ordinary taxis. However, due to the insufficient number of vehicles and the need for users to download mobile apps for each of the fleets individually, hailing a taxi from the fleets remains challenging. 

The lack of orders for these fleets also makes it difficult to attract drivers to join, creating a vicious cycle. 

Chan stated recently that authorities would expand the number of designated drop-off and pick-up points for taxi fleets and assist them in applying for 100 percent electric vehicle loans to support their development. 

For the establishment of a unified hailing platform, Octopus Cards Limited announced last year that it would introduce the Easy Ride platform, allowing passengers to book rides without downloading separate fleet apps. Sources indicate that the new platform is nearly ready and will be announced when the time comes. 

Meanwhile, the Legislative Council passed a bill on ride-hailing services last year, which may begin operations as early as the fourth quarter of this year. It is reported that some taxi fleets are in talks with platforms such as Amap and DiDi to enhance and promote their services. 

Cheng Hak-wo, representative of the SynCab fleet and president of the Taxi Dealers & Owners Association Limited, confirmed that discussions are underway with ride-hailing platforms, with initial plans to offer fleet taxis on these platforms. This could help alleviate the current inconveniences in hailing fleet taxis. 

Insiders noted that the legalization of ride-hailing platforms will intensify both driver and business competition. The initial licensing requirements for taxi fleets are likely unfeasible, prompting the government to consider a more realistic approach. They may relax fleet size regulations and eliminate time restrictions if service quality improves. 

Lawmaker Ben Chan Hang-pan noted a significant discrepancy between the taxi fleet policy’s implementation and its initial vision. He suggested that Octopus’s “aggregated platform” could simplify hailing and boost business, attracting more drivers to the industry.

Initially, the government introduced the taxi fleet policy without deciding on the legalization of ride-hailing platforms, aiming to assess the impact of taxi reforms. However, after extensive debate, they expedited the regulation of ride-hailing services, placing taxi fleets in a challenging position. With ride-hailing platforms launching soon, the role of taxi fleets needs to be reviewed.