Free the market for taxis

  • Business
  • Saturday, 03 May 2014

THE decision by the Land Public Transport Commission (Spad) to migrate all taxis to the Proton Exora under the Teksi 1Malaysia initiative emboldens monopolies instead of letting market forces dictate what cars should be taxis.

Sure, London has its London taxicabs and New York its taxicabs and their images are famous the world over. There is uniformity in those taxis and much of that has to do with history, and as a consequence, the type of cars that are taxis.

Malaysia really does not have the history to label a certain type of car a taxi. And it really should not be the case.

The issue is not about supporting the national car. The issue is about mandating a certain car that is fit to be used as a taxi.

The Exora is surely an upgrade over the bulk of taxis on the road today. The old Iswara and Waja models don’t qualify as vehicles to transport paying passengers around because of their lack of modern safety features and even comfort levels.

The multi-purpose vehicle is a spacious car and those who own it say the turbo-charged version is the preferred choice. With ample cabin, modern features and baggage space, the Exora is a worthy taxi.

But to label the Exora as a taxi is akin to pigeon-holing the car. What then happens when technology supercedes the current model or taxis on the road?

In New York, hybrid cars are already taxis. In London, minicabs compete with the London taxis, albeit with a few limitations.

Fuel efficiency is as important as the fares a taxi gets, because energy is the number one constant cost in running a car. The other is maintenance, and costs are generally higher when there is a monopoly involved.

The other reason why picking one car should be discouraged is because it goes against the efforts by the Malaysian Competition Commission to eliminate monopolies.

Just as hard as they are trying to eradicate monopolies, there is yet another Government agency which is creating one.

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