7 Reasons Driving Private-Hire and Taxi is getting tougher in Singapore

Driving private-hire and taxi for a living was never easy and is getting tougher with many changes taking place in Singapore.

We explore the 7 Key Factors that will affect Private-Hire and Taxi Drivers in Singapore.

Changing Work Dynamics

The pandemic has made companies recognize the fact that they do not need their workers to be in the physical office. With a laptop and internet connection, workers can work from home or anywhere. With working from home a default option to many, the amount of people going back to the office has dropped significantly and so has the demand for rides.

Car Pooling

With rising car ownership costs, many non-commercial drivers have jumped into the carpooling scene. Non-commercial carpooling services such as Grabhitch and RydePool do not require commercial car insurance and the Private-hire label. Trips on Grabhitch and Rydepool are also a cheaper option for commuters.

Car Sharing

The rise of on-demand car-sharing is also an alternative solution for commuters. Car-sharing services such as BlueSG and GetGo have popped up all over Singapore and is readily available. Commuters who want to go to multiple places may find driving themselves in these car-sharing schemes an easier and cheaper solution than booking multiple rides.

Better Connectivity with Public Transport Infrastructure

image – Mothership

The public transport infrastructure of Singapore is vastly different from the past and almost every part of Singapore will be served by an MRT station in future. When commuters have the option of a cheaper and faster way of commuting, the demand for private-hire and taxi services will bound to be affected.

The rise of cycling as a hobby and also as a mode of transport is happening around the world. Roads and park connectors are built to make commuting on a bicycle safer and easier.

Everything can be Delivered

In the past, many private-hire and taxi drivers would have the experience of picking up a rider from home, sending them to Mcdonald’s drive-thru to ‘dabao’ and then sending the rider back home again. On the way home maybe stop 1 more time at 7-11 to buy Marlboro Menthol Light. Trips like this usually end off with a good tip or the rider would offer to buy you a burger or enjoy a stick together at the end. Nowadays, everything can be delivered in a few touches of the app and people have the luxury of staying home and wait for their stuff to be delivered.

Rising Car Cost

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The cost of car ownership has shot through the roof in the past few years. COE prices have almost doubled from a high of $36,704 in 2019 to $68,501 in 2022 for Cat A Cars. Bigger cars in Cat B have seen a high of $48,010 in 2019 to a high of $94,889 in 2022.

The higher cost of car ownership will translate into higher costs for drivers, either through higher rental costs for those who rent or higher depreciation costs for those who buy their own cars.

Increasing Cost of Petrol and Electricity

image – Fuel Kaki

The cost of petrol has hit unbelievable levels in Singapore and it is expected to go even higher with no end to the Russia-Ukraine conflict in sight. As of 10 March 2022, all petrol prices in Singapore will start from at least $3/litre. It remains to be been how high will petrol prices go.

Electric vehicles are also expected to pay more for their electricity soon as electricity tariffs start to creep up.

The rising costs of petrol remain the most immediate challenge that drivers face. Every week, drivers are paying increasingly more for their petrol and there is no other way out.

Taxi companies have already announced the increase in fares in March 2022, will the private-hire operator follow suit?