Should I Become An Uber Driver or A Taxi Driver?

In case you’re REALLY wondering if this is my next move to a 15 hour work week, let’s just say that right now, my plans of becoming both a freelance writer and full-time private tutor are chugging along nicely.

Recently, I am spending my mornings doing a little bit of paid writing (not just for this blog) while venturing around my neighbourhood in the afternoons and evenings having lessons with Primary, Secondary and even Junior College students. Going forward, a freelance income of between $2k to $3k seems really plausible and if I do require more moolah, I could always free up more evening slots for lessons. 

So why am I writing this post then?

confused zooey deschanel new girl wut huh

I would definitely prefer spending 500 days with Summer rather than with a car 

I don’t know, but I like to think of worst-case scenarios.

One day, Singaporean parents might all wake up one day and realise that they shouldn’t make their kids so academically competitive. And who knows, maybe at the same time, I get a flurry of letters from readers telling my clients how horrible my writing is.

If this happens 5 years later, returning to paid employment might prove to be a little difficult as my previous work experience might well be obsolete by then. Enter taxi driving. 

Since I am turning 30 next year, and I have heard umpteen times that becoming a taxi driver is the last resort for many Singaporeans, why not give it a careful thought? And apparently, I am not the only one that thinks this way. I read somewhere that there are actually 99,700 taxi vocational licence holders, but only 40,000 are driving taxis.

However, if I am interested in getting paid to drive people around, becoming a taxi driver is no longer the only option with the entrance of private car hire (PHV) companies like Uber and Grabcar recently. 

So, since I get to choose, which is actually a better option for me?

Why Uber, or rather, Private Car Hire Companies Seems Like a No-Brainer Choice

full house michelle tanner duh

Just take a look at the comparison table below:

Taxi Driver Uber Driver
At least 30 years old At least 25 years old
Must be a Singapore Citizen Singapore Citizen or Permanent Resident
$40 for the application process and another $355 for a 5 module course that is expected to take 95 hours. All Uber drivers need to register a limo car company with ACRA. This will cost you $65.
A daily minimum mileage of 250 kilometres on weekdays. It’s flexible and whether you drive or not is up to you.

The entry requirement is less stringent, the cost to become an Uber driver is lower and there is more flexibility involved! If my writing gigs dry up and I need a little more cash, there’s really nothing stopping me from driving people to their offices during morning peak hours.

What’s there to not like about Uber?

An Unequal Playing Field

reactions protest not fair unfair picket

Many taxi drivers in other cities are up in arms…

My preference to sign up as a private hire car driver with Uber rather than become a licensed taxi driver can be attributed to the unequal playing field. 

Well, if you are already a taxi driver and had previously put in significant effort to get the taxi license, I can probably understand why you are not so keen to switch. In fact, you could be quite upset with the situation, which I can definitely empathise with.

Not surprisingly, this has caught the attention of newly-appointed Minister of Transport Mr Khaw Boon Wan. The National Taxi Association (NTA), representing taxi drivers, has also come up with a list of recommendations recently regarding the review of private hire car services. Also, read this interesting Mothership interview with Ang Hin Kee, NTA’s advisor; you might be surprised whose playing field he is trying to level. In fact, Ang went so far as to describe the current LTA’s taxi rules as “costly, not quite reflective and a bit onerous”.

On behalf of the NTA, Ang has also shared the taxi drivers’ concerns with LTA.

I found it heartening that NTA actually urged LTA to re-look at some of the statutory requirements that have become prescriptive, distorting and costly as a way to level the playing field. Therefore, instead of just increasing regulations on private hire car services, perhaps the requirements to become a taxi driver could be eased.

And ultimately, NTA acknowledged that passengers’ safety and security should not be compromised. Besides being similarly qualified and certified, NTA recommended that private hire vehicles and drivers serving the same market should adopt similar identification protocol for consumers’ safety and security. This would allow for clear accountability with regard to unfortunate incidents, disputes and claims.

Why Most Taxi Drivers Have Not Switched Yet

cute sad kid thinking

Pondering and pondering…

Besides awaiting the outcome of the review by the Ministry of Transport and LTA, switching to Uber might not be that clearcut for the full-time hardworking taxi driver.

As Uber takes a significant 20% cut of the earnings, the value proposition might not be as strong to switch for a full-time taxi driver, even though rental costs for an Uber car is much lower than a taxi.

Taxi Driver Uber Driver
Rental $130 $65
Fuel Cost $30 $30
Revenue $400 $400
Commission $0 $80
Take-home Pay $240 $225

As seen above, if the taxi driver is able to secure 20 trips at an average of $20 per trip, he/she would be better off being a taxi driver as compared to Uber. At the same time, many taxi drivers are also wary of how prevalent the usage of apps like Uber are and are afraid of giving up their income from flag-down customers.

There are also other factors for consideration like the high excess liability because commercial insurance doesn’t provide enough coverage. And what if the Uber driver gets an unfair review from a passenger and gets banned from using third party apps etc? Hah, maybe the private car hire drivers need representation too! Who knows? It makes perfect sense for, say, NTUC to facilitate the creation of a new association for the private car hire drivers.

Concluding Thoughts

trailer minions thumbs up you got this

New innovations and business models are good for consumers

Truth be told, I have not taken an Uber ride before. After all, the last time I took a cab was probably more than 3 months ago. However, from my conversations with friends and relatives, most are full of praises and remarked that it’s easier to call a taxi these days.

Therefore, it’s pleasing to know that the Singapore government and regulatory bodies did not outrightly ban Uber like other countries/cities and resist new innovations and business models.

As mobile data usage is on the rise, I actually forsee that flag-downs would cease in importance in the near future. Afterall, bookings are more efficient for both taxi drivers and passengers. Instead of driving around aimlessly looking for passengers, wasting petrol and contributing to traffic congestion, drivers can rest while waiting for bookings. Having adequate rest also ensures a safer ride. As for passengers, they do not have to stand under the hot sun or pattering rain just to flag a cab and grow frustrated in the process.

Hopefully, the review can improve transport availability and contribute to greater efficiency in the use of our transport assets. And perhaps achieve lower fares yet higher incomes for taxi drivers at the same time too?

I am eagerly anticipating the results of this review. Who knows? I might still go and apply for a taxi license in the end next year.

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10 thoughts on “Should I Become An Uber Driver or A Taxi Driver?

  1. B

    Hi 15hww

    Interesting take there, i doubt you will end up as taxi driver though 🙂

    I didnt expect the costs paid to.uber would be that close though, think they are really giving comfort and the rest a pretty good fight there.

    1. My 15 HWW Post author

      Hi B,

      Never say never. Maybe next time you drink Starbucks, I might be the barista serving you!

  2. Jared - SMOL

    15 HWW,

    This thing about driving taxis as a last resort is quite true and comforting.

    I had interesting conversations with taxi-drivers who were ex-MDs and owners of businesses.

    Never say never.

    Sometimes things don’t always go as planned or in a straight line extrapolation….

    As a trader, I identify a lot with taxi-driving.

    We are our “own boss”, work alone, with uncertain pay, and sometime have accidents!

    1. My 15 HWW Post author

      Hi SMOL,

      Interesting to compare it with trading. Some good insights there.

      Humans like to extrapolate. A Roman in AD 117 would imagine that 500 years later, things would get better. And how wrong he turned out to be that AD 117 proved to be the peak of the Roman Empire.

  3. George Tan

    Apps like Uber and Airbub is making waves to the world.

    Previously taxi uncle like to play hid and seek during peak hours, now we have alternative.

    Getting taxi is easier now, unfortunately the taxi companies will have to let go profit to fight the new competitions.

    1. My 15 HWW Post author

      Hi George,

      You are right. This is the new sharing economy and from the environmentalist point of view, it’s a great use of our limited resources on this planet.

      Those taxi companies have enjoyed oligopoly profits for some time now and it’s only fair for them to fight to stay in the game.

  4. XUber DrIver

    Did I see wrongly or did you write wrongly? How can the fuel cost for Taxi and Uber private car be the same? All Taxi run on diesel, but private car run on petrol. Base on the your example, for Uber private car to make the $400 fare you need to top up at least $80-$90 fuel cost. Which mean, the Taxi driver bring home $240 but Uber driver bring home only $170 est.

    1. My 15 HWW Post author

      Hi XUber Driver,

      Thanks for the clarification!

      However, is it true that Uber drivers would save on fuel costs since they are not inclined to drive around to pick up flag-down passengers?