Corona, Uber, minimum wage, expensive spare parts and, on top of that, record fuel prices: the German taxi industry is under pressure from many sides. One of the consequences could be a sharp rise in tariffs.
The German taxi industry has its back against the wall. The Federal Association of Taxi and Rental Cars estimates that the number of taxis, companies and drivers in Germany has fallen by around a fifth since the beginning of the Corona crisis.
In the big cities in particular, where the majority of German taxis are based, the companies are under pressure, explains Managing Director Michael Oppermann. And the shrinkage is probably not over yet, because there are a multitude of effects that are currently making life difficult for the industry.
There are no nationwide current figures on the taxi trade. After all, they are available for Berlin: Before Corona there were a good 8,000 taxis there, in January 2022 only 5,905, as reported by the State Office for Citizen and Regulatory Affairs. Although the decline in the capital is probably greater than the national average, it shows the extent of the problem.
Pandemic caused business to collapse
On the one hand, Corona has caused many taxi business areas to collapse. Tourism, trade fairs, business trips, airport trips and nightlife – all of this has decreased enormously – especially in the big cities. And Oppermann is skeptical that the values before the pandemic will be reached again in all areas. In addition, the industry was already under pressure from competitors such as the transport service provider Uber before the outbreak of the pandemic. On top of all this, there are also reclaims of Corona aid, the upcoming increase in the minimum wage and the sharp rise in prices for workshop visits and fuel.
According to Oppermann, the biggest financial problem is the minimum wage, because staff account for around two-thirds of the costs in the taxi industry. The high fuel prices – although they are around 40 cents per liter above the average for diesel in recent years – are significantly less important. But that could also be the straw that breaks the camel’s back for a company, because the tariffs are “sewn on the edge,” emphasizes Oppermann.
Oppermann: Tariff increase by a quarter necessary
In order to compensate for the burden, the tariffs for taxi rides would have to rise, says Oppermann. If possible, until the October increase in the minimum wage. This must be approved by the respective municipalities. Normally that could take a year, but now he hopes to implement it more quickly – if possible by the time the minimum wage is introduced.
On average, he considers an increase in taxi tariffs by around a quarter necessary – depending on when and how much the last increase was. Nevertheless, Oppermann does not believe that the decline in taxis is over. Overall, he assumes that the pandemic will result in a decline of one third in vehicles, drivers and companies, with the previous fifth not having achieved this by a long shot. And the upcoming easing of the corona measures will hardly be able to prevent that. In contrast to many other sectors, no catch-up effects are to be expected, says Oppermann. “People don’t drive around the block twice now because they haven’t taken a cab in the last two years.”
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
