Taxi Surcharges

There’s a bit of local news here that I suspect will again have readers either shaking their heads in disgust or again crack more jokes about taxi companies in Singapore. Formatted to save space, and italics mine:

Jan 12, 2010
RESORTS WORLD SENTOSA
$3 cab surcharge at RWS

VISITORS to Resorts World Sentosa (RWS) will have to pay a premium to take a taxi from the integrated resort when it opens next week.

Four taxi companies have confirmed that they will impose a $3 surcharge for trips that begin at the IR. Premier Taxis will be the first – it will start charging on Jan 18 – followed by SMRT on Jan 20 and Prime Taxis on Jan 28. Trans-Cab will follow suit, but has not confirmed a start date. Smart Cabs said it will join in, if most of the other companies impose the surcharge. The lone exception: ComfortDelgro, which is far and away the largest taxi company in Singapore.

The companies that are imposing the surcharge say they are doing it to ensure taxi drivers will find it worth their while to cross into Sentosa.

blog-rws The line that takes the cake of course is the last one: that the taxi companies are doing this as a carrot for taxi drivers to drive into Sentosa. Not that I have any intention of visiting RWS soon when it partially opens later this month. But the introduction of yet another premium to be paid only underlines the almost paternalistic treatment of taxi companies towards it drivers.

The logic gets a big Fail when one considers that there are already a lot of cabs in Singapore. In any other service or product-centric industry, the situation would have naturally resolve itself: because there are so many service providers around, they would naturally compete among themselves to get business without needing additional incentives. But hell no – taxies in Singapore operate with their own laws of logic. Many service providers who elsewhere would have healthily compete, but for taxies, incentives must still be employed to tempt the providers.

As though the surcharge and fare structure in Singapore isn’t already convoluted enough. You don’t just pay for the distance traveled by your cab. Here, you pay for waiting, booking (and booking surcharges varies depending on time and day), peak hour, late night, public holidays, and entry into specific locations.