Some drivers’ incomes have declined as number of taxi and PHV drivers exceeds passenger demand

SINGAPORE: The local taxi and private-hire car industry has seen a significant rise in the number of drivers, outpacing the growth in demand for passenger services and resulting in a decline in driver earnings for some, according to Senior Minister of State for Transport Amy Khor.

Responding to questions about supply and demand in the point-to-point transport sector, Dr Khor revealed in Parliament yesterday (10 Sept) that the number of active taxi and private-hire drivers increased by 8% from April 2022 to June 2023.

However, passenger demand has lagged, with the average number of daily trips rising by only 1% during the same period. This imbalance has led to a reduction in the incomes of many drivers as competition for passengers intensifies.

Dr Khor also highlighted that average markups and net fares in the first half of 2023 have dropped, returning to levels similar to the first half of 2022 after peaking earlier in the year.

Despite this, the government has no plans to intervene in fare setting, as these are determined by transport operators based on market dynamics.

Sharing that the authorities will continue to monitor fare trends closely, she emphasized that the flexibility of the market allows the supply of drivers to adjust according to fluctuating passenger demand and fare levels.

Seasonal factors also influence the point-to-point transport sector. Dr Khor noted that major events and festive periods typically drive up local and tourist demand, pushing fares higher during such times.

Looking ahead, the Land Transport Authority (LTA) will focus on ensuring the efficiency of point-to-point services. Among the strategies under consideration is reducing the operational costs for drivers, helping them cope with the challenges posed by fluctuating demand.