Taxi firm sector trends

Black taxi with 'TAXI' sign lit up during night-time

(last updated July 2019)

What has been happening in the taxi trade sector?

In recent years there has been:

  • a general increase in demand for taxi services, which has been boosted by things like successful anti-drink-driving campaigns, the introduction of the London congestion charge, and a general increase in tourist and business activity in many areas. The vote in June 2016 to leave the EU led to a fall in the value of the pound, which encouraged tourists to visit the UK, particularly London
  • an increase in many areas in the number of taxis and private hire vehicles, creating a very competitive environment
  • the rise of taxi apps - particularly Uber. Although Uber does work with licensed taxis, many taxi drivers feel that it enables minicab drivers to get around the law and operate in a very similar manner to licensed taxis by picking up 'pre-booked' fares on the street and then charging them on a per-mile basis worked out by the app using GPS tracking
  • moves to streamline the London 'knowledge' test, and controversial proposals to replace it altogether with GPS
  • the introduction of requirements for taxis to be wheelchair accessible and to meet increasingly stringent emissions standards - particularly in London, where only zero emissions new taxis are permitted to be licensed. A criminal record check requirement has also been introduced for taxi drivers
  • significant increases in fuel and licence costs while fare levels have remained competitive. Although fuel prices fell between 2013 and 2016, they then started to edge up again
  • a tightening up in the guidance to local authorities on how to check the immigration status of applicants for a taxi licence to prevent illegal working in the taxi and private hire sector
  • the abolition of the luxury car tax on cars costing over £40,000 (£310 per annum for 5 years) for zero-emissions taxis

Recent years have seen the government consult on modernising and updating taxi and private hire regulation in various parts of the UK, not least to try to bring it up to date with technological changes like the growth of Uber.

Although overall demand for taxi services is likely to remain reasonably strong, you will have to decide whether:

  • demand will be high enough in your particular area to provide you with enough trade. If you plan to operate in a rural area, there simply may not be enough customers who will want to travel by taxi on a regular basis
  • there is room for another taxi business in your area

Keeping up to date with the taxi sector

Joining a trade association is an excellent way of keeping up with developments in your industry. The Licensed Taxi Drivers Association (LTDA) represents the interests of taxi drivers in London and produces Taxi Newspaper. You can find out more about the LTDA and get contact details on their website. Other national and regional trade associations include the National Taxi Association and the Scottish Taxi Federation - visit their websites to find out more about the benefits and services they offer to members.

Trade journals and magazines are another good source of information about the industry. Private Hire and Taxi Monthly journal includes features of interest to taxi businesses as well as private hire businesses. The journal is produced by the National Private Hire Association and can be downloaded from the PHTM website. Taxi News online includes features of interest to cabbies in London and throughout the UK.

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