Opinion: Here’s how to make a surly cabbie smile - burst Hong Kong’s taxi license bubble
All the problems we have with Hong Kong’s taxis come down to official protection of the city’s HK$120 billion speculative bubble.
Restrictions on driving commercial vehicles will be eased to allow younger people to fill shortages in the ageing workforce, especially the taxi and container truck sectors ...
South China Morning Post, City, May 10
One thing our bureaucrats refuse to do in addressing the ailments of the taxi industry is look in a mirror. There they would find both the problem and the solution.
They would be forced to recognise that their negligence has allowed a HK$120 billion (US$15.4 billion) speculative bubble to emerge in the industry and that the only way they can fix things is to deflate that bubble. They will fix nothing if they allow it to remain.
The fact is that a standard fully equipped Toyota Comfort taxi costs about HK$250,000. To put one on the road for hire, however, requires buying a taxi licence from an existing holder of one, and this costs about HK$7 million, which values the entire taxi fleet at about HK$120 billion.
So here is the big question: what do the licence holders do to earn that extra HK$6.75 million between the cost of the car and the right to put it on the road?