s 2021 winds down and we anticipate the coming year on our horizon, it’s important to create a space to digest the past year and see how it will reflect into the coming year. We hear from four taxi and ride-hail experts, each from different industry perspectives, to unpack these challenges and trends, and call upon their proposed solutions.
Emerging from 2021’s taxi and ride hailing challenges stronger.
It’s hard to talk about the past year in review and its reflections forward without mention of the pandemic. As Asher Moses, Founder & CEO of Sherbet, mentions, operators have adapted:
“Some immediate changes felt were safety measures: COVID has also introduced the challenge of improving the quality of the service with new health and safety policies but also of capturing the changes in the customer preferences.”
Along with adapting to this new context of health regulations, ride-hail and taxi operators have had more customer demand than expected, and also fewer drivers. This is partially because the pandemic triggered early retirement among drivers, but more largely due to drivers finding other, more reliable means of work, for example in the on-demand delivery area.
Asher explains how there has been a particular boom for taxi services:
“Since the UK, and in particular London, came out of lockdown the taxi trade has bounced back far stronger than anyone predicted. Customers are picking to travel in taxis over other forms of public transport, particularly for shorter journeys and we see this trend continuing.”
While pandemic restrictions and driver shortages are trends which will persist into the new year, operators must also keep their eyes on bigger, longer term challenges and trends and proactively embrace them as opportunities.
1. Kerbing our environmental and social impact.
Juraj Atlas, Founder and CEO of Mileus, sheds light on some of these other large challenges for ride-hail and taxi operators:
“While we don’t know how long the driver shortage will last, we do know supply utilisation and minimising environmental impacts are longer term issues. Upgrading fleets to EV is just part of the solution. We also need to move to a more sustainable mix of shared mobility to reduce the number of cars in our cities.
The taxi, private hire, and ride-hailing industry will have to defend its place in this mix by providing efficient services with minimal environmental impacts. And those impacts go beyond just greenhouse gas emissions; they include for instance resource scarcity and renewability or livability and quality of life. While any shared mobility services are better than using a private car, some are better or more relevant than others, at different times or locations, and should therefore be part of the mix of future sustainable transportation.”
The COP26 Climate Talks conference held in Glasgow last month was a sharp reminder of the urgency of the climate crisis — further actions that need to be taken, and quickly. As 25% of the EU’s carbon footprint comes from transport alone, this is an issue that has and will only continue to impact how ride-hail, taxi, and private hire companies stategise and operate.
Although public authorities are starting to roll out policies, operators should be ahead of this curve if they really want to be competitive and relevant — to both their customers and city authorities. Already, we see this shift happening.
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2. EV fleets becoming a standard in the taxi, Ride-hailing & private hire industry.
“In wake of high market demands taxi & taxi fleet operators are taking back control of the ground transport market and we are seeing increasing investment in electric taxis that provide safe, secure and sustainable travel. Now is the time to invest in taxis as the future is not only bright, the future is green,” says Asher, the CEO of Sherbet, a UK black cab company which is enroute to being 100% electric by 2022.
While the electrification of fleets is an important step to achieving carbon neutrality, it raises new issues that also require deep cross-sector collaboration. Lidia, Combined Mobility Manager at UITP, unpacks:
“But electrification comes with a whole set of challenges, especially on business models, governance and public-private partnerships for charging infrastructure. To decarbonise the sector, the solution of electrifying fleets implies the involvement of government with policies, leadership and alignment of public measures and incentives, a thriving entrepreneurial and innovative community developing new and sustainable business models, strategic public and private partnerships especially for charging infrastructure but also trained drivers and staff as well as public awareness and demand for electric vehicles.”
3. Fostering public-private partnerships: An essential way forward.
Urban mobility stakeholders, private and public sector alike, should consider all the factors Lidia mentions and prepare for and start acting on them as they proceed into the new year. Electrification of the sector needs innovation spurred on by startups and the private sector, but it also needs the public sector to keep a macro perspective about its optimal implementation. It’s yin-and-yang.
And, this demand for cross-sector collaboration to get EVs rolling which Lidia talks about is bound to go beyond just EVs. Public-private partnerships are necessary for the success of any innovation or positive change in the industry.
Michael Agius, Commercial Director at NTS, calls on local authorities to support ride-hail, taxi, and PHV operators in reaction to all drivers needing to be registered with HmRC (Her Majesty’s Revenue and Customs ) from April 2022: “As we will be bringing new drivers into the trade after the pandemic, local councils need to assist.”
In the same stride as getting local council support, he explains that there is also digitalisation to aid this challenge: “For registering new drivers, there is now tech being developed by companies such as Cab9, Autocab, icabbi and Cordic for a fully automated driver onboarding process, which should make it much easier to bring new drivers on.”
And these are just a few examples. Lidia explains the challenges being faced by transportation authorities and regulators on a larger scale: “Regulation of ride-hailing and taxis, as well as data governance, is a hot topic and one that is on the radar of regulators such as the European Union. How to better integrate taxis and ride-hailing into the mobility ecosystem in complementarity with public transport is also a recurrent question for regulators.”
4. Fitting ride hailing, private hire, and taxi services into a sustainable mobility ecosystem.
Juraj describes how public transportation has been playing its role to co-create better mobility ecosystems: “Public transportation has been undertaking three phases of opening up to better optimise and integrate itself. It’s done so already by opening transit schedule data, including its real-time delays information, and now it’s opening its ticketing systems. All this is happening on technical standardisation and regulatory levels to enable the next wave of innovation for multimodal offerings with aggregated payment capabilities.”
And how can the ride-hail, PHV, and taxi industry synergise with this?
“Ride hailing and taxi, together with carshare, providers have the best chance to capture the value that can be created by the transit ticketing being opened up around the globe. This is because vehicle-based shared services are the closest to the comfort of one’s own car,” says Juraj. “It is key to find the right levels of trust and incentives for individual mobility providers to share their data, both from supply and demand perspectives. Ride-hailing operators seem to be lagging behind when it comes to sharing their data, so this is their chance to step forward and collaborate more with clearer terms and regulations.”
Shrinking environmental impacts, making EV fleets the norm, fostering public-private partnerships, understanding how to fit in a larger mobility ecosystem: the opportunities for 2022 and beyond.
Moving forward, there are several aspects shaking up our industry as we react to challenges, be it getting to carbon neutrality or tackling the current driver shortage. As we try to anticipate what else may be around the corner, it is key for ride-hail, private hire, and taxi operators to harness public-private partnerships, take steps to fit into the larger mobility ecosystem, and keep going green a priority, not only with EVs.
Let’s conclude with an encouraging view by Lidia on how operators should play their role in a more sustainable urban mobility system at large: “Cooperation with the tech disruptors, mobility innovators & transport operators is key to tackling the challenge(s) on the horizon. Re-positioning of business models is taking place and constructive and positive cooperation has the potential to emerge as the new way of doing business. Each sector within the MaaS market has to embrace societal changes, technology and bold decision making to drive forward new products and services that meet the needs of customers.”
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