Here’s why small taxi operators are the biggest losers as Uber and Grab gain traction

While larger operators remain hedged, say analysts.

There’s no discounting the effect of private car hire services on Singapore’s taxi business, but now analysts have reason to believe that this trend may be a bigger bane to smaller cab operators.

According to a report by DBS, Premier and Prime have both receded 0.6% and 0.5% market share, respectively, since Dec 2013 to May 2015.

In comparison, its bigger counterparts Comfort/CityCab and TransCab have both gained 0.7% share each in the same period, based on LTA taxi fleet size data till May 2016.

The report noted that this could be due to a smaller proportion of core full-time drivers for smaller operators, thus ceding to competition such as private hire car services.

Additionally, other factors include rising competition, thus a disincentive, reducing viability to maintain fleet size; and lower levels of ancillary support/ benefits such as availability of company diesel pumps, telephone bookings, etc.

“Over the longer run, our view is that there will be a balancing point between taxi and private hire car and both models are likely to co-exists, but with a smaller number of players as the industry consolidates,” the report said.

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