ST, June 13, 2005So what do we learn from the article above?
More cabbies failing to pay rental
ON THE back of ballooning fleets and falling passenger numbers, taxi companies are facing a worsening problem of cabbies with bad debts.
Six of the seven cab companies here have been hit and, based on official figures, The Straits Times estimates that operators now repossess 1,000 cabs a year because of non-payment of rental.
That is about 5 per cent of all taxis on the road now.
ComfortDelGro, the largest taxi operator here with about 17,000 cabs, used to repossess about 50 taxis a month because of non-payment. The number has risen to nearly 70 recently.
'It is very difficult,' said cabby C. K. Chan. 'I know of drivers who collect only about $120 to $150 a day in fares. They cannot cover costs.'
Taxi operators act like car rental companies, leasing vehicles to cabbies. The drivers pay a daily rental of about $90, on top of about $40 a day for diesel and other outlays on things like carparks and car washes.
Ms Tammy Tan, spokesman for transport group ComfortDelGro, said: 'From January to May this year, a monthly average of about 30 per cent of our hirers owe an average of five days.'
A five-day delay in rental payment from one-third of its hirers translates to about $2.3 million.
Mr Johnny Harjantho, managing director of newcomer Smart Automobile, has also observed a worrying trend.
'There are cabbies who genuinely cannot pay, but we are coming across people who are out to cheat. They come in on a Thursday, pay a deposit of $1,000 and take a cab. We bank the cheque on Friday. When we realise the cheque has bounced on Monday or Tuesday, he is gone.
'By the time we find him, he would have owed us 20 days of rental. Some of them will say: 'Go ahead, sue me'.'
Mr Harjantho estimates that half the hirers of his fleet of 460 cabs owe between one and 30 days of rental. The company is forced to repossess 'a few cars' each week.
Unable to cope, companies sometimes turn to debt collectors.
Ms Priscilla Low, an account manager at debt collector Lousintan, said the company handles more than 20 cases a month for several taxi companies. Debts range from 'a couple of hundred dollars to a couple of thousand'.
'We work out payment by instalments over six months to a year.
'We have a 70 per cent to 80 per cent success rate,' she said.
ComfortDelGro has its own credit controllers, but would still like to see an industry blacklist of drivers with bad payment records.
Premier Taxis general manager Lim Chong Boo said the company had to slow down fleet expansion plans this year, to weed out errant drivers and bring its debt situation under control.
Cabbies say the problem is there is just too much competition.
According to Land Transport Authority figures, there are more than 21,400 cabs on the road today, 45 per cent more than in 1994. At the same time, taxi ridership has fallen. An LTA study found taxi rides fell 12 per cent to 827,000 a day during the 12 months up to March last year.
Coupled with a 40 per cent hike in diesel prices over the last year, that means cabbies' earnings have fallen.
In addition, a cabby who cannot find a relief driver often has to drive two shifts to cover his costs.
Mr Chan said: 'I have seen many drivers sitting in coffee shops, in a daze because they are so tired.'
Firstly, taxi companies don't make money out of passengers. Taxi companies make money out of taxi drivers.
Secondly, who are taxi drivers? Ordinary Singaporeans who can't get a better job and are suckered into driving a taxi.
Thirdly, Straits Times journalists are great at offering meaningless statistics to support poor conclusions. Take a look at this:
"According to Land Transport Authority figures, there are more than 21,400 cabs on the road today, 45 per cent more than in 1994. At the same time, taxi ridership has fallen. An LTA study found taxi rides fell 12 per cent to 827,000 a day during the 12 months up to March last year."
The journalist is trying to tell you that today, (1) there are more and more cabs and (2) fewer and fewer passengers.
To prove (1), he tells that that the number of cabs has increased significantly, between 1994 and 2005.
To prove (2), he tells you that from March 2003 to March 2004, the number of passengers has fallen.
But of course, those numbers are quite meaningless.
The number of passengers may have fallen in the period from March 2003 to March 2004 (a one-year period), but the number of passengers may well have risen sharply in the period from 1994 and 2005 (an 11-year period).
Alternatively, the number of cabs may have risen significantly between 1994 and 2005 (an 11-year period), but it may have fallen sharply between March 2003 and March 2004 (a one-year period).
Moral of the story? Statistics lie. Especially if the Straits Times is providing them. See here for another example. And here too.
The only people I know who consistently handle statistics as badly as the Straits Times are those banks, fund managers and insurance agents who throw a set of highly-manipulated numbers at you and tell you, "Yes! This is the best-performing fund. You must invest in it!"