A Watershed Moment?

By: Wim Faber, Dutch Journalist and Taxi Specialist, Dutch Belgian Magazine (Magazine Personenvervoer) 

As I’m (slowly) getting to be a very senior editor, in a career built on reporting and editing on what is happening in the taxi and public transport industry in many different countries and various continents, I'm wondering whether we have arrived at a defining watershed moment, changing the characteristics of the industry as we know it.

In my career (which I still thoroughly enjoy), writing in different countries for different audiences, I have never detected such a sea-change in the taxi and mobility industry worldwide as the one that’s coming. No, I’m not talking about including and using Artificial Intelligence (AI) in dispatching systems and apps. Or about electrifying taxi fleets. That’s relatively small beer compared to what I’m talking about. Neither am I referring to platforms moving into the taxi industry, with many taxi operators convinced cooperating with platforms will actually benefit them. The jury is still very much out on the wisdom of that.

An evaporating industry?

The taxi industry as we know it, in many countries run by independent fleet operators steering a fleet (or fleets) of employed or self-employed drivers or by cooperatives – collectives of self-employed drivers - is slowly evaporating. Or should I say, morphing into an autonomous stand-alone service or into part of public transport (as public mobility, more likely in Europe). I’m talking about the socio-economic side of the industry. I’ll come back to the socio-cultural side at the end of this column. With a call for help.

Mercedes now seems to embrace the robotaxi-market with its most expensive flagship model: the recently released S-class, as a model hardly ever used as a taxi

To get an idea of how others see the taxi industry, the German car-maker Mercedes-Benz is an interesting yardstick. When I addressed my first meeting of the then called ITLA at the Fontainebleu Hotel in Miami, I mentioned that most European colleagues drove Mercedes-Benz taxis, the diesel workhorses of the industry and practically indistructable. To American taxi operators’ ears – gasping as I said it - that sounded far-fetched, as they knew Mercedes models on gas, not diesel, as a top-notch elite brand, certainly not for daily taxi-use.

Mercedes’ choice

For many years, European taxi colleagues enjoyed a warm bond with this star-brand, as they also did with Volkswagen – two stalwart and trusted suppliers to and supporters of the taxi industry. In many countries, and particularly in Germany, both brands regularly threw parties and showered their faithful customers with discounts and other presents. Mercedes in particular was the lead star in the taxi world and stories about the durability of the 200D model from whatever year were legendary. Mercedes happily used this solidity as its advertising trade mark. Taxi equalled Mercedes.

A few years ago that bond cooled. The top brass in Stuttgart took their eye of the taxi market and decided their focus was no longer on the erstwhile taxi friends but instead on more expensive, upmarket models and different partners. Mercedes’ share of the taxi market plummeted and even in Germany taxis now mainly come from Japan, South-Korea and China. In its latest decision, Mercedes now seems to embrace the robotaxi-market with its most expensive flagship model: the recently released S-class, as a model hardly ever used as a taxi. Stuffed full of electronic gadgets, this model is exquisitely suited for the autonomous (platform) market. Although it keeps its options open in many mobility areas, Mercedes seems to slowly be turning its back on its friends from the taxi industry. But is that so strange?

Waymo vs. London cabs

It illustrates the watershed moment in the taxi, or should I say public mobility market. In the USA and China the use of autonomous taxis is no longer exclusive. China, with its different homegrown suppliers, is clearly in the lead with thousands of autonomous taxis. Europe, with its smaller suppliers and differing legal rules re. travel and traffic safety between 27 European Union-countries, is the laggard in this respect.

In September Waymo’s autonomous fleet will be navigating London’s complicated street pattern with a myriad of users: pedestrians, cyclists, e-bike riders, moped users, buses, cars and taxis. Photo Wim Faber

But where Mercedes’ shift is a clear indication, the biggest onslaught on the traditional taxi market is happening in September, when Waymo’s autonomous fleet will be unleashed on London, the most traditional and quality-rich taxi fleet in the world and a complicated street pattern with a myriad of users: pedestrians, cyclists, e-bike riders, moped users, buses, cars and taxis. I wonder what the thinking at Waymo’s HQ was: mastering a challenging medieval street pattern or giving the London taxi trade a slap in the face? Perhaps both?

Socio-economic upset

The biggest clash between what is possibly the best taxi service in the world, the London taxi trade, with taxi drivers who in the famous ‘Knowledge of London’ have learned 20.000 streets and important buildings within a six mile radius of Charing Cross station to get their license. And Waymo’s autonomous taxis, probably as partner of a major platform. The continuous rise of these platforms, often in semi-legal competition with the taxi industry and profiting from a cheap and easy to manipulate workforce, is also fundamentally changing the socio-economic structure of what was the taxi industry, but which is evolving into a public mobility system, autonomously filling in the space between taxi and public transport or being part of the latter.

The platform competition – steered on a national or international basis – has changed local markets and is restructuring national and international ones. The taxi industry, traditionally organised locally in small or medium-sized companies or collectives, were ideally suited to service local markets. Will they fall prey to platforms, which are often operating on the limits of what is socially acceptable, ‘partner’ with them or slowly go under as more and more autonomous vehicles appear on streets all over the world? Or will large national conglomerates of cab companies provide a lifeline? It is difficult to see what the future role for taxi companies or collectives would be, in a local or regional transport economy – with platforms and autonomous companies - which are differently scaled and funded. This would be food for a more fundamental discussion, if only on the socio-economic level.  

Time for a taxi museum?

Before I sign off, could you help me answering a simple question? Considering the taxi industry is changing fast, I would think it is high time to preserve what the taxi industry is all about. Before you list several collectors of taxi models (I’m sure there are still lots of Checker-models left, well preserved, and London taxis), there are places which house interesting collections of local and sometimes national socio-cultural examples of the taxi industry as is and was.

A socio-economic and cultural part of the taxi industry: a taxistand in Berlin with a classic restored phone call pillar, pre-radio used to call the local taxi directly. Photo Wim Faber

The taxi industry is more than just material examples. Over the years, thanks to the people working in it, it gave rise to rich local cultures. The taxi industry is more than just transport. I wrote about this aspect in the book ‘Taxi, Limousine, and Transport Network Company Regulation’*), authored together with James Cooper, Jørgen Aarhaug and John Scott.

Is there a museum or collection anywhere which encapsulates both the socio-economic as well as the socio-cultural aspects of the taxi industry through the ages? Please let me know: wim.faber@challans-faber.eu

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*) Taxi, Limousine, and Transport Network Company Regulation. By James M. Cooper, Jørgen Aarhaug, John Scott, Wim Faber. ISBN 9781032187655

184 Pages. Published 2023 by Routledge.

Wim Faber