Taxi industry led the way in adopting Hybrids, but needs to see a Charger/Grid plan, insurance before it can go 100 per cent electric

“Toronto is only committing to make only 50 per cent of its bus fleet electric by 2030, and the drivers of those busses will still get paid every two weeks whether the bus is profitable or not“

Following is the text of Rita Smith’s September 21st deputation to Toronto’s Economic Development Committee. Taxi News will share transcripts of additional deputations in the days ahead.

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Good afternoon, and thank you for allowing me to speak today.

My name is Rita Smith. I am the publisher of Taxi News, online at taxinews.com

It was a pleasure to listen to the speakers from Mondolez this morning, and be inspired again by business people making plans for success in Toronto. Mondolez was a great reminder that  cost/benefit assessments are a crucial part of business planning.

Almost nowhere in business is an “all or nothing” approach deemed to be the best option, especially when piloting something new.

I have been writing about the Taxi business since 1985 when Taxi News was founded; here are some things I’ve observed.

First, NOBODY wants to be part of Toronto’s Economic Development more than your typical Taxi owner. They want to make tourists happy; they want to make residents happy; they want to be part of the business community.

These folks are keenly aware that their own personal “Economic Development” is tied directly to Toronto’s.

They want the City to be clean and livable: we all breathe the same air, we all drive the same streets.

Second, over 40 years, we’ve watched Taxi owners invest in everything Toronto ever asked them to: propane conversions, sealed meters, 17 days of training, $1600 security cameras. Later, they were told these things were maybe not so necessary as Toronto first thought.

Taxi drivers are subject to the same economic principles that govern Mondolez’ Bakeries, and Shelley Carrol’s daycare, every other business ever launched:

The money they spend in their business HAS TO BE less than the amount of revenues they generate.

If their expenses are greater than their revenues, they will lose money and get to pay for the privilege of working. This can happen for a very short while; then, it ends with the business folding.

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For example, we are seeing this happen right now, in Toronto’s Accessible Taxi field.

Drivers by the hundreds have found it costs more money to keep their Accessible van on the road then they are able to generate providing rides.

By permitting 86,000 vehicles for hire to cruise where there used to be 5,500, Toronto decimated their revenues, while expenses increased.

They have had to return their plates to the City and park or sell their vans, because they cannot operate when expenses are greater than revenues.

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If we apply these same principles of Revenues versus Expenses to the idea of a 100% electric Taxi fleet, the risk is high the same thing will happen.

Toronto is asking Taxi drivers to take a GIANT leap of faith and assume responsibility for financing an expensive vehicle which may or may not be able to be re-charged during the business day;

–which may or may not be reliable during the cold Canadian winter;

–which may or may not generate sufficient revenues to meet expenses.

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Toronto is only committing to make only 50 per cent of its bus fleet electric by 2030, and the drivers of those busses will still get paid every two weeks whether the bus is profitable or not.

Toronto is asking 100 per cent of Taxis to be electric by 2030. The drivers of those Taxis will not be able to eat or live indoors if their Taxi is not profitable.

Obtaining Taxi insurance is already a problem, and the largest insurer of Toronto’s Taxi industry told me they currently cannot afford to insure an all-electric Taxi because,

“a broadside hit that might be a few thousand dollars repair for a standard vehicle makes an electric vehicle a complete write-off because of the battery location. We cannot afford to write off an $80,000 car because of a minor collision.”

Did Toronto do any research into insurance for fully electric Taxis in writing this report?

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In recent discussions with Taxi industry members, no one is arguing against new technologies or lower emissions.

They are concerned that cost of vehicles, maintenance, repair and insurance will dwarf the amount of money customers are willing to pay for a ride.

They fear revenues will never cover expenses.

They fear the charging grid will not be ready and cabs will die during rush hour.

“Hybrids, we can do,” owners say. “Why doesn’t Toronto start with 100% hybrids while they work out the charging grid, and everything else?”

“Why don’t we walk before we try to run?”

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Lack of planning is killing Toronto’s dream of “Accessible on Demand” Taxi service.

It would be a shame to see “Reduced Emissions” program go down the same road.