Australia Taxi Market -Segmented by Method of Request, Vehicle Type, and Geography - Growth, Trends, and Forecast (2018 -2023)
Taxis play a major role in the Australian transportation network. The demand for taxis is consistently increasing in the country, owing to numerous benefits that the market to the consumer, such as booking convenience, multiple payment options, 24x7 customer support, GPS enabled vehicles, and electronic fare meters. Apart from the aforementioned benefits, shared transportation is also growing due to the cost benefits it offers to its customers.
IMPACT OF GOVERNMENT REGULATIONS ON THE MARKET
Australia’s state governments control the taxi market by limiting the number of licenses required to operate taxis and private hire vehicles. Before 2015, the ride sharing operations were prevented but they were legalized in all the states after Northern Territory legalized it in April, 2017.
Additionally, as part of the reform packages for legalizing ride sharing operations, and in order to fund the compensation, most of the Australian states started to impose a levy of ~1 AUD on the trips for a certain period of time. The taxi license holders who have invested a huge amount would seek compensation at the hands of ride sharing rivals who do not hold taxi licenses. Some of the states provide the license holders to retain exclusive economic rights to the rank - and - hail segment which is 65 - 80% of the taxi market. Moreover, this imposition of levies is expected to have a negative impact on the average cost of a taxi fare and the demand for taxi.
The Australian taxi network is predominant in the states of New South Wales (NSW), Queensland, and Victoria. The NSW taxi network form an integral part of state’s public transport system and complements other forms of public transport system. The taxi license values in Sydney witnessed a decline and huge variations since 2012, with the entry of Uber, however, they were stabilized after the emergence of ride sharing regulation in 2015.
HIGH COMPETITION EXISTS BETWEEN PLAYERS
Uber opened the way for new entrants into the market despite the regulations that tightly controlled Australia’s taxi market. The company entered the market in 2012 and had a significant market share over the last three years, then the competitors began to enter the market. With the launch of services by European company Taxify in December 2017 and India’s Ola in February 2018; resulting in heavy competition among all, along with the local players such as GoCatch, ihail, Cabcharge, and GM cabs.
Additionally, the transportation network companies are charging lower commissions to lure the drivers. For instance, Ola is charging only 7.5% of fares as commission, Taxify takes 15%, and Uber charges 22%. Additionally, companies, such as Ola, are also focusing on listening to drivers and making changes in their model on the basis of the advice given by the drivers, is making them empowered. Consequently, intensifying the competition among the players.
March 2018: India’s Ola started its operations in two major Australian cities, namely, Perth, and Sydney; and is also focusing on plans in expanding into Melbourne
The Australian taxi market is being tapped by numerous domestic players, resulting in a highly competitive market environment.
Some of the significant players in the market are Uber Technologies Inc., Taxify, GM cabs, Cab IT, Yellow cabs etc. Of the existing players, Uber occupied 3% share of the overall market followed by yellow cabs, black and white cabs, etc.
Other players include Silvertop, 13 cabs, Premier cabs, Rydo Taxi, Shehab, Shofer, etc. Shehab Taxi service is fully focused to provide solutions to only women and children.
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