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Do FIXED price taxi fares boost bookings or do they simply drive cabbies away?

Image credit: LEVC

FREENOW launched its 'Fixed Fare' initiative, targeting the London night-time market. Starting yesterday, taxi drivers using the app will be able to offer fixed fares from 8pm to 7am on weekdays.

This initiative is designed to make fares transparent, allowing passengers to know the cost of their journey upfront. FREENOW believes this transparency will encourage more users to book taxis through their app, potentially increasing overall demand and ensuring drivers do not lose out on earnings.

It’s not the first time fixed price fares have been trialled by the black taxi apps and the pricing strategy is not without its challenges. In FREENOW’s instance, some drivers have already expressed concerns around the acceptance rates for these fixed fare jobs and the potential repercussions of declining too many such offers. This could deter some drivers from using the app during these key hours, fearing penalties or bans.

Historically, fixed price fares have been tested by various taxi apps, with the same result: its future removal. Issues such as driver availability during peak season, pricing in favour of the customer and the impact on tips have historically made drivers hesitant. Many drivers also see the meter as one of its unique selling points, just like the Knowledge of London or the black taxi they drive.

Fixed price fares are often linked to Private Hire Vehicle offerings which many cabbies distance themselves from to maintain the distinct two-tier licensing system in the capital.

Taxi drivers were asked for their general view on fixed price fares via the London Black Taxi News page on Facebook which has over 12,000 followers. One cabbie called Jon said: “If the driver is over paid the customer is losing out and if the Fixed Price is a lot less then the driver is losing out. Driver won’t cover the work if there is alternative options.”

Another said: “I don't mind fixing a price if it’s going to be about the same as what it would run on the meter, but I don't discount ever.”

Taxi driver Tim said: “Never in the driver's interest. Today took me over £12 to get out of Midland Road (Kings Cross) from the rank.”

Brian said: “Let's all become minicab drivers, which is what we will be. No £100,000+ useless vehicle, we could buy a executive car at less than half the cost. All the overheads will be less. Why did we bother to do the knowledge in the first place? It seems that this is the direction we are being taken!”

Overall the responses were sceptical of fixed price fares ever working in the London taxi industry.

With the industry’s peak season kicking off with the Chelsea Flower Show, it remains to be seen how popular fixed fares will be among drivers. It is worth noting that taxi drivers are usually open to the inclusion of competitive fixed fares to airports or longer journeys over £100, where passengers understandably prefer a predictable cost. Fixed price fares in the direction of home at the end of a shift may also tempt a few taxi drivers to accept. However, for shorter trips, the industry has seen fixed fares come and go, often due to lack of lasting appeal.


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