

'Taxi wars' in France as new businesses try to compete [video] - petercooper
http://www.bbc.co.uk/news/world-europe-13320358

======
Ras_
'Taxi wars' is also current in Finland. Few young entrepreneurs tried to enter
the market with moped-car taxis. Those teens were immediately choked out of
existence with heavy handed bureaucracy. We've also had Maxi Taxis (a more
serious venture), which entered the streets of Helsinki unannounced. They were
trying to exploit a loophole (minivans registered as trucks) in the
legislation. Besides heavy lobbying against them, they were constantly
harassed and even physically blocked by taxis and their drivers (very radical
approach in regards to current Finnish society). Maxi Taxis folded quickly as
the legal loophole was closed in record time.

Our taxi licenses are cheap, but supply is artificially restricted. The
Ministry of Interior decides how many taxis can operate in each town. Taxi
licenses cost about 300 euros; processing expenses. Toughest prerequisite is a
short (few weeks, cost less than 1k euros) taxi-entrepreneur course.

The Ministry of Interior resorts to micromanagement. They set the maximum
number of licenses for each and every town based on estimated need (which is
quite sensitive to lobbying). For example the current maximum number of
licenses in Helsinki is 1386 (for a population of 590k). In 2008 100 new
Helsinki-licenses were issued, and just as anamax commented above: It was
protested with an argument "Cabbies don't make a "living wage" as it is". This
number was reduced by 51 in 2010.

There are queues, but they are generally not very long (in Helsinki you might
need to wait for 10 years, but many smaller towns have free spots which you
can claim without delay). You can drive a taxi as a hired man as the license
is vehicle-, not person-specific. Hired man gets paid about 30-40% of the
turnover of his rides.

Both the number of licenses and fare rates are national monopolies. A ride of
similar length costs the same in Helsinki as it does everywhere else. Rates
are set by the Ministry of Interior.

No price competition and artificially restricted entry to market. Friction
with modern society: heavy. Taxi monopoly might not be the first to fall,
since we still have, e.g. state monopolies on gambling and liquor. Of these,
the former could end soon thanks to the EU.

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jeandenis
In Paris, when the government proposed to allow motorcycle taxis and other
modes of transportation (such pickup by taxis not from Paris and privately-
owned shuttle buses) as legitimate ways to pick up passengers at the Paris
airports (CDG, Orly), Paris taxi license owners organized a taxi-blockade of
the airport. It was very effective. After a couple such blockades, I believe
the proposed change was stricken from the law.

The whole thing was/is known as "Operation Escargot" -- Operation Snail.

I hope I have to eat my words one day, but I just don't see how any law
involving "competition" in the Paris taxi scene could ever pass. Even small
increases in the # of licenses will lead to taxi strikes (or the threat
thereof), and the government/city back-off very quickly whenever that happens
as you can imagine. The only way for it to happen would have to be through an
out-of-France process, such as Euro-level (de)regulation or a competition
proceeding (antitrust).

I'd love some more background for the video and any suggested liberalization
of licensing (perhaps there is only minimal licensing requirements in Avignon
in the first place, compared to Paris, e.g.).

edit: added "Paris" at the end of the last parenthetical.

~~~
uvdiv
" _I hope I have to eat my words one day, but I just don't see how any law
involving "competition" in the Paris taxi scene could ever pass._ "

Easy. If taxi drivers illegally obstruct public roads by "blockading", arrest
and prosecute them. This is crime, not political speech. It is a broken
political system where a minority can force an outcome by intimidating the
public with violence.

------
thamer
Taxi companies are against this kind of competition because of the licenses
they had to pay in order to be authorized to take passengers. These start-up
companies operate without such a license. I believe the same charge was
brought against UberCab.

Taxi licenses are outrageously expensive. A driver in Paris told me his was
190,000 euros, and it can get even higher in touristic towns on the
Mediterranean coast: <http://www.licence-taxi.fr/prix-licence-de-taxi.php>

~~~
petercooper
It wasn't explained in the video but I got the impression some sort of
'liberalization' of the licensing laws has occurred to make this possible.

I did some Googling and found some discussions about licensing liberalization
in France but no specific mentions of how/when it was implemented (if it ever
was).

It wouldn't surprise me if it were, though, since here in the UK getting a
license isn't particularly tough (added: with some notable exceptions, see
reply posts).. so maybe there's some EU harmonization going on in this regard.

~~~
arethuza
"UK getting a license isn't particularly tough"

What about "The Knowledge" required for London black cab drivers - which
apparently takes between two and four years of study and exam attempts to
pass:

[http://www.tfl.gov.uk/businessandpartners/taxisandprivatehir...](http://www.tfl.gov.uk/businessandpartners/taxisandprivatehire/1412.aspx)

[Edit: I sometimes wish they had something like this in Edinburgh - I've had
to tell taxi drivers here where to go a few times and the taxis here are
_very_ expensive compared to Glasgow and London].

~~~
petercooper
Good point. It's night and day between different areas. It's hard work to
become a 'black cab' driver in central London, as you say. But just a few
miles away in a different borough of London you can get a license with barely
more than a criminal check and some other commonsense precautions (these are
often called "minicabs" in London and can't call themselves "taxis" for a
number of legal reasons). I used to do a lot of work for several south London
cab firms and becoming a driver for them seemed pretty easy - you just had to
do a certain amount of "account" work for free and you then got the lion's
share of the remaining take. No "medallions" or crazy expenses beyond
insurance and car maintenance.

~~~
arethuza
I'm pretty sure minicabs can't pick up passengers on the street, only black
cabs can do that. Don't minicabs have to rely on bookings through a central
office?

~~~
cabalamat
That's correct (or was when I lived in London).

Of course, this law is widely ignored -- which is just as well if you want to
get home at 3 am.

------
ajays
Here in San Francisco, some of the "old money" people control a large chunk of
the medallions. The whole process is very opaque. Drivers usually rent the
taxis from these owners; typically, it's $100 for an 8-hour shift, double that
for weekends.

Sometimes I think about what would be a fairer scheme than locking away a
medallion for life? One possibility would be to have 5-year Dutch auctions of
medallions. This way the City keeps getting value out of the medallions, and
can increase the supply as the population grows.

~~~
uvdiv
" _One possibility would be to have 5-year Dutch auctions of medallions._ "

Or you could stop pretending the government can legitimately criminalize a
harmless business activity at the behest of a rent-seeking cartel. Money is
not obscene. Driving a customer from A to B in exchange for payment is not a
crime.

~~~
buyx
_Or you could stop pretending the government can legitimately criminalize a
harmless business activity at the behest of a rent-seeking cartel._

I agree with you, to some extent. However, some level of regulation is
necessary, otherwise "harmless" can quickly become "harmful". The case of
South Africa is instructive.

In South Africa, the Apartheid government entirely deregulated the minibus
taxi industry in the late 1980's. It was to be a cheap source of transport for
the black population, since public transport links, particularly in newly
established "white flight" areas were very poor (whites tended to have cars,
blacks didn't). Also the idea was that individual taxi owner/drivers would
help foster black entrepreneurship.

The best description of what happened next I've read is "the miracle of the
1980's turned into the nightmare of the 1990's". Instead of one-man one taxi,
we got one owner, with many taxis. Taxi owners formed cartels, and violence in
competition for routes led to murderous street warfare ("taxi wars").

The weakened state (1990-1996) was unable to intervene. Starting with the
Mandela administration, attempts were made to re-regulate taxi operations, but
were consistently stymied by the taxi organisations. Even as recently as the
last 2 years, taxi owners, through road blockades (and a fatal shooting)
managed to strong-arm the government into giving them control of a new
Johannesburg bus system.

In any town and city in South Africa, overloaded, barely roadworthy taxis
blast through intersections disregarding traffic rules, stopping dangerously,
their drivers desperate to increase their takings, menacing their own
passengers and other motorists with their aggression. Fatalities are not
uncommon.

~~~
uvdiv
It goes without saying that _every_ policy is contingent on a functioning
government capable of protecting its residents from violence. You'd hardly
expect the United States to have the same problems as violence-ridden South
Africa, regardless of policy.

That said, I don't understand your reasoning. You claim that free-enterprise
taxis are responsible for violence in SA. But if that government, according to
your account, can't even maintain _basic road safety_ , how could they
possibly enforce a taxi monopoly? If they tried to set one up, they'd simply
create a black market of cabs, which they'd have no control over. If anything
that should be worse; "illegal" cabs would evade police and would not undergo
whatever licensing/safety checks ordinary cabs get.

(On a tangent, a state-enforced cartel is quite analogous to the dystopia you
describe. Instead of private businesses using mob violence to "defend" "their"
turf, the police enforces it for them. Same crime, only institutionalized,
sanitized, and socially acceptable.)

~~~
buyx
Yes, they lost control of road traffic enforcement as well, but not to the
extent that they lost control of the taxi industry. Having some form of
regulation would have kept the taxi operators busy evading the state rather
than acting with criminal impunity (maybe even behaving better to not arouse
suspicion), a better result than what actually happened.

And the state is stronger now than it was in the past, but the legacy of
deregulation lives on - getting the genie back into the bottle is harder than
letting it out.

 _Same crime, only institutionalized, sanitized, and socially acceptable._
"Sanitized and socially acceptable"...sounds good to me.

------
51Cards
Slightly off topic but I liked the word play in the last line (paraphrased):
"It's not easy to be a start-up when you're viewed as an up-start."

------
jsavimbi
Next time I'm in Avignon I'll take one of those new, fancy cabs. Not so sure
about the motorcycle cab.

~~~
corin_
Slightly offtopic, but does anyone have any experience with motorbike taxis
(or indeed being a passanger on a non-taxi motorbike).

The firm I use whenever I'm in London offers them, I assume that no experience
with motorbikes is needed to be able to sit on the back of one?

~~~
bhickey
Are you referring to Addison Lee? I was under the impression that they only
used motorbikes for courier service.

~~~
corin_
Indeed I am. <https://www.addisonlee.com/services/taxybikes/>

Edit: Just rang up to find out about rough prices, the journey I most commonly
take is £11 in a normal car and £25 on a bike. So only really worth it when
there's going to be bad traffic (which admittedly is quite often in London) or
if you really like riding on a motorcycle. Can't remember how that compares to
their more expensive car services, I rarely use them (99% of the time I'm on
my own for work or with friends, exec cars only when with a client for some
reason.)

Will probably give it a go next time I'm there just for the hell of it. At
least then I won't be tempted to read Add Lib.

