Australia: Taxi Industry Overview

Key Facts Key Trends

$6 bn Estimated revenue of the taxi and

limousine Industry in 2016 • Emergence of ride sharing applications like Uber and GoCar have disrupted the
traditional taxi industry.
80% of the industry is represented by Taxi
services(booked and non booked), rest being
• Sharing Economy is gaining momentum with the entrance of numerous players
in the Car sharing and Carpooling industry also. There is no significant
wheelchair accessible taxi services and luxury sedans ridesharing competitor to Uber in Australia
• Government is offering incentives to encourage “green” taxis such as discounts
1.6% Annual growth rate of taxi industry
2012-17
on registration of vehicles for more environment friendly vehicles.
• UberX is considered 20% cheaper than traditional taxis. It has been estimated
that the average typical UberX driver drives around 20 hours a week and earns
227 mn Rides were performed by the taxi industry
in 2014,out of which 14.5 million rides were
$2,500 a month while a typical taxi driver drives for around 45 hours per week
and earns around $3,600 per month
completed by Uber
• A reduction in taxi licence fees from $20,000 to $10,000 was witnessed recently
and some of the competing factors influencing the number of annually issued
75,000 People receive gainful work and business
opportunities working directly with the
licences, includes population growth, lobbying by licence-owners and the
popularity of competing services such as ridesharing
traditional taxi industry • It is estimated that consumers benefitted from UberX operations by almost
$81.1 million in 2015
54% Of the Australians that use taxi services now
use ride sharing services
The Australian Taxi Industry Association is the national peak representative body for the taxi industry in Australia and it has various State Taxi Industry
representative bodies. External competition has been intensifying for the regulated taxi industry, UberX has been the main external player responsible
for the recent unrest in the taxi industry.
Source: Ibis 2016,Nielsen 2016,Uber 2016 Deloitee Report
Government vs Uber
How are the States dealing with Uber:
Northern Territory: UberX service remains
illegal

Queensland: UberX service remains illegal

New South Wales: Government announced that it will legalize Uber

Western Australia: Uber is in discussion with the government to create a new through regulation changes
license category for its services
South Australia: The govt.
allowed Uber to operate from July ACT: The ACT government signed an agreement to
1,2016 allow Uber to operate in the nation’s capital,
provided Uber drivers pay a certain fee

Victoria: Uber has agreed to allow drivers to be accredited by the government, but this
has yet to be endorsed by state government legislation.

The Ridesharing Industry in Australia has been growing substantially over time due to its differentiated service and lowering of costs between buyers and
sellers. The rise of this industry is also resulting in lowering of license plates values of traditional taxis due to decrease in demand. Australian taxi
networks have also attempted to respond to the digital disruption by creating their own smartphone booking app and the government has approved it, to
show its support towards its taxi drivers.
Taxi regulations and license fees force taxi fares to be higher than Uber’s, so the playing field is not levelled, but the government has realized this and is
working towards providing compensation to the taxi drivers and making regulations easier so that the two taxi services co-exist, as the sharing economy is
here to stay. Increase in penetration of non traditional taxis is inevitable as the customers get cheaper prices for the same service.
It has been estimated that uberX grew the market for taxi-style services in Melbourne, Sydney, Brisbane and Perth by $50 million a year, so its not just
cannibalizing the market but also growing the size of the market in Australia.