By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas Taxi Cab Union’s president yesterday voiced optimism that the imminent 10 percent fare increase will offset the industry’s “over saturation” after it was revealed that new vehicle loan requests jumped six-fold in late 2022.

Wesley Ferguson told Tribune Business that taxi drivers will “no longer be perceived as hustlers” due to a reform package that includes a ‘code of conduct’ all drivers must abide by, and pledged: “You’re going to see great things coming to the taxi industry.”

He spoke out after the Central Bank’s latest bank lending conditions survey, covering the 2022 second half, revealed that loan applications to finance the purchase of new taxis and rental cars rose by 500 percent compared to the prior year. This was attributed to the Government lifting the prior moratorium on taxi plates, which sparked demand for new vehicles among recipients.

“Significant advancements were noted for taxis and rented cars, which rose more than four-fold, reflective of the Government’s lifting of the moratorium on taxi plates,” the Central Bank said. “Applications for taxis and rental cars expanded by 500 percent.” However, an expansion of that magnitude represents a six-fold increase.

And a deeper dive showed that this 500 percent increase was based on a small base, with just 18 loan applications for new vehicles and taxis made to commercial banks during the six months to end-December 2022. And of those 18, just six were approved, making for a relatively low approval rate of just one-third or 33 percent.

However, Mr Ferguson said the increased demand for vehicles had been sparked by the need to accommodate more passengers and visitors following tourism’s post-COVID rebound. That sector’s “aggressive” revival, he added, together with the impending 10 percent increase to all fare rates should help counter the disruption caused by the influx of new taxi drivers - all competing for the same business - following the moratorium’s end.

“The market is dictating that you get a bigger car,” the union president said of the increase in loan applications. “Prior to the lifting of the moratorium, the majority of taxi drivers had five to seven-seat cars. Then the cruise port re-opened and arrivals rebounded in such an aggressive way there’s a greater need for vehicles to carry 12-15 persons.

“The taxi drivers are opting to take a chance, because the economy looks really vibrant, and are choosing to purchase bigger cars. A lot of them are flush with cash, so they don’t need to go to their banks. The taxi economy is pretty lucrative. They do the fare increase, which was just announced last week, and it’s going to give them an even bigger boost financially.

“You’re going to see great things come out of the taxi industry. We’re about to roll-out a new code of conduct that will bolster the reputation of taxi drivers and make them realise they’re entrepreneurs and not just hustlers like they’re presented to be.”

Mr Ferguson confirmed that the fare increase, which still needs to be implemented through publication in the Government’s official gazzette, is “10 percent on all existing rates”. While this is lower than the 25-30 percent he had initially pushed for, as a means to offset higher fuel prices and the increased cost of living, the union chief added that the revised structure will also include “clear” rates for transporting baggage and animals.

“The fare increase was one of our demands on the minister and the Government; to level the playing field and mitigate the shortfall with the over-saturation of the industry,” Mr Ferguson added. “The increase in fares will mitigate the shortfall as a result of that.

“I would think that, with the new fare increase, that will level the playing field with the over-saturation and, with the robust tourist arrivals at the port and airport, we should still be able to take home a good week’s pay.” However, the union president said Jobeth Coleby-Davis, minister of transport and housing, had yet to provide “a comprehensive report” on the number of taxi plates in existence - including those issued since the moratorium was lifted.

Mr Ferguson yesterday estimated that just shy of 700 new plates have been issued since the prohibition was lifted by the Davis administration, saying the number had increased from 1,135 to 1,818 although he provided no evidence to support these figures. “Plates are still being issued systematically every day in this country,” he added. “I think there may also have been a backlog of those who were left behind.”

Still, the Bahamas Taxi Cab Union president asserted that the industry’s prospects were looking much improved. The fare increase for drivers is one aspect of a reform package, also including the ‘code of conduct’ and display of rate schedules for passengers, that is designed to improve behaviour, overall standards and end constant complaints about tourists and locals being over-charged.

“It’s a two-sided coin, two-fold effort,” Mr Ferguson said of the reforms. “It was already a complaint that taxi fares were too high. There were a lot of complaints from industry stakeholders about taxis over-charging and not having a dependable taxi rate. It was a grey area, and the rate schedule has not been updated since 2016.

“What it does now is it gives the Ministry of Transport and the Road Traffic Department, the controller, some boundaries to say what the new rate is and, if you charge more than that, it gives them the ability to say you’re in contravention. It gives the Road Traffic Department a grip on the over-charging. They have a definitive rate they can go by.

“The hotels can publish the rates and have them on display to get rid of the over-charging. It’s a win-win for everyone because the industry, the airport, Baha Mar and Atlantis have always had issues with taxi drivers over-charging, but with the new rates they can publish them on display and get rid of the over-charging. It gives the authorities a grip to say we gave you a fare increase, you are over-charging and so there will be disciplinary measures levied against you.”

Mr Ferguson said the 10 percent fare increase is “not Nassau centric” and will be rolled-out across all Bahamian islands. “The future of the taxi industry looks good,” he added. “The rhetoric between myself and the minister has ended. We decided to bury the hatchet and work together in partnership to make sure taxi drivers taxi drivers take care of the tourism industry.”

Asked when the fare increase was likely to take effect, the union chief said Mrs Coleby-Davis had forecast it would be implemented before this summer. “We’re looking at between mid-June and mid-July,” Mr Ferguson said, adding that this will give all sides time to “fine tune, pick out all the pins and needles in the old rates, and come up with something suitable for tourists and the public who also catch taxis”.