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Taxi apps uproar highlights artificially low cab fares (2)

(Shanghai Daily)

08:33, June 04, 2013


But I do object to things that might distract a driver, like talking on a cellphone, and I might also think twice about getting into a cab with so many apps buzzing on its dashboard.

One TV report I saw even managed to track down the driver and question him about his famous cab, prompting him to admit that he'd gotten rid of all but one of his favorite apps after the storm of publicity from the photo.

Now it seems that these taxi apps are raising yet another controversy, bringing me back to this collision of the old and new that I mentioned earlier.

The latest uproar centers on taxi drivers and software developers who are using their apps to charge extra fees above the official fare levels, especially during peak hours, rainy days and other times when it's hard to find a cab.

The cabbies are basically using these apps as a sort of backdoor to circumvent low fare levels.

I know that Shanghai and other Chinese cities aren't the only ones that set local taxi fares, and most other major cities around the world also use similar systems. But the big difference is that China's fares are set extremely low, to the point where people often end up taking taxis in almost any situation.

That contrasts sharply with most of the West and Japan, where people only take cabs when they're really in a hurry since such transport is often quite expensive.

Low fares

China's low fares mean that taxi drivers often have to work long hours a day to earn a decent wage. From the consumer side, such low fares mean passengers often have to wait a while to get a taxi, sometimes half an hour or more during peak hours. And even then they have to argue and jostle with other people also looking for cabs, making the task that much more unpleasant.

Against that backdrop, this innovative use of technology seems quite reasonable.

On the one hand, it allows cabbies to raise fares through the use of app-based surcharges during peak hours, thus raising their salaries. At the same time, it also efficiently allocates a scarce resource, the availability of taxis during peak times, by giving that resource to the highest bidder.

The only problem is that Shanghai city officials have decided they don't like this kind of backdoor run around the state-set pricing system, and are taking steps to formally ban the app developers from most of their surcharges and other bidding systems.

I do agree that the city may need to step in and regulate this fledgling but booming industry, which is showing many typical signs of spinning out of control due to the entry of overzealous and often unscrupulous entrepreneurs.

But surely everyone can find a middle road that allows for extra charges at reasonable levels that would benefit nearly everyone, except for those people who like to use taxis as a form of personal driver because they're so cheap.

【1】 【2】



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Email|Print|Comments(Editor:LiXiang、Ye Xin)

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