Taxis idle as city faces drastic, and growing driver shortage

Xu Lingchao
Shanghai is facing a major shortage of taxi drivers caused by low wages, residency restrictions and competition from online car-hailing.
Xu Lingchao

Shanghai is facing a major shortage of taxi drivers caused by low wages, residency restrictions and competition from online car-hailing.

One major taxi firm, Haibo, says about 25 percent of its fleet has been off the road since last year due to a lack of drivers.

And the number of people registering to sit for the driving exam has plunged from 10,050 in 2009 to just 1,499 last year, the local traffic authority said yesterday.

Qiangsheng, one of the largest taxi firms in the city, said it has only 20,000 drivers for its 12,000 taxis — leaving 1,500 cabs off the road, as two drivers are needed to run each cab 24x7.

Zhang Liang, a senior Qiangsheng executive, said serious problems began in 2016.

“Every year since 2016, we have lost about 10 percent of our drivers,” said Zhang. “Many old drivers are retiring but few new faces are coming in.

“Last year, the company spent 70 million yuan (US$11 million) on bonuses and incentives for drivers. But still, few people are willing to do the work.”

According to Qiangsheng’s 2017 annual financial statement, the taxi business brought in 1.11 billion yuan in revenue but costs were 1.07 billion yuan and net profit was just 30 million yuan, leaving a gross profit rate of just 3 percent.

“I’ve been driving a taxi for almost 30 years,” said one driver from Qiangsheng who identified himself as Wu. “My monthly income hasn’t changed much in about 20 years, but I drive two more hours every day.”

Wu works a 12-hour shift every second day and says he earns 6,000 yuan net a month.

“Young lads don’t want to be a taxi driver anymore,” he said. “Someone has to do the job, but I’m retiring after this year.”

Only people who have a Shanghai hukou (permanent residency permit) can apply for a taxi license, restricting the pool of potential drivers. Authorities did relax that rule briefly several years ago, but soon re-imposed it.

Taxi operator Dazhong recruited about 1,000 non-local taxi drivers during that time. But company executive Dai Jianhua told Shanghai Daily the company was also running short of drivers now.

Some also blame the boom in online car-hailing services for the current shortage.

Ni Guochang from Qiangsheng has a stable group of regulars, but is picking up few customers on the street because of the popularity car-hailing apps like Didi Chuxing or Meituan Dianping.

“I do about 12 trips a day, sometimes 15,” said Ni. “Most of the orders come from the call service of Qiangsheng or my regular customers.”

Kang Zhijin, a Didi driver without a hukou, told Shanghai Daily he earns about 10,000 yuan every month.

“Locals wouldn’t even do our job — they think the wage is low,” Kang said. “It’s not hard to understand why taxi firms are lacking drivers.”

During this year’s Shanghai Two Sessions, political advisor Tu Haiming suggested another attempt at allowing non-residents to drive taxis, under strict conditions.

In response, the Shanghai Transportation Commission this week said it had been looking at a solution for several years and may in the future allow non-residents.

“But such solutions must be meticulously studied as it matters a great deal to the public as well as the taxi business,” said the authority’s Ma Fei. “A more detailed timetable for any new policies for the industry is yet to be discussed.”

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