The Past We Lived Through
The taxi industry has been a part of city and community landscapes since the “modern” taxicab first appeared on the streets of London in the late 1800’s. Since then, taxis have grown into a massive worldwide industry with strong regulation and protection in most jurisdictions. Such “rules” have limited competition while also minimizing any need to evolve, improve and innovate. Then along came something called Uber bringing with it an entirely new industry called “ride-sharing” and the taxi industry suddenly saw it’s protective glass house shattered to pieces overnight.
Shielded from competition with regulations limiting the number of cabs on the street while dictating fee structures, taxi company owners concentrated on revenue. This took its toll on service and fleet quality. Outside of hailing a taxi on the street, cab response times were unpredictable with long customer wait times being the norm. And often the cab itself was a poorly maintained vehicle with torn and dirty seats, squeaky breaks and a driver with no cab side manner.
The Present We’re Living With
Uber shows up with a simple app where customers are picked up in minutes by a clean, recent model and well-maintained car. Service is the focus, with well-dressed, polite drivers who gladly help with bags. Some even provide water, candy, and other extras to make the ride more pleasurable.
Wake up horn for the taxi industry!
They say disruption is often the most effective catalyst to force positive change, especially in an old, entrenched industry. You could say Uber drove in and massively disrupted the taxi business!
The Future As It Can BeYes, taxis still have a LARGE and powerful presence. The taxi industry IS NOT rolling over and falling into the scrap yard. We’re talking about an immense global business estimated to generate over $ 100 billion/year in revenue. Just in the United States, taxi industry numbers are staggering:
- Annual revenue in excess of $ 20 billion
- Over 230,000 taxi drivers
- Over 413,000 employees
- Over 338,000 businesses
In my market alone, the Las Vegas taxi industry generated over $ 425 million in revenue in 2015 representing almost 28 million trips! Taxis are definitely sticking around!
Yes, it’s been hurt by ride-sharing. In some markets, ridership and driver income are down by up to 50% over the prior year. But fleet owners are wide awake, recognizing mistakes made, opportunities overlooked and are exploring ways to not only level the playing field with the ride-sharing companies but drive technologies that will help them gain the lead.
As Senior Vice President for IoE Connectivity at beamSmart, I have been working closely with taxi companies and regulatory bodies around the country. I can tell you this industry IS focused on bringing true technology into their members. While much of the buzz in this area has been around basic apps that look to deliver Uber-like functionality, the real solution for the taxi industry is a total end-to-end system that integrates dispatching, response, communication and safety into one platform. A product that beamSmart has already perfected.
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