Taxi apps just the latest in a long list of grievances for China’s cab drivers

12 January 2015

Taxi strikes are nothing new in China: In fact, they have been a regular part of urban life for more than a decade now. But with the increasingly widespread use of taxi hailing apps, these strikes have once again caught the attention of the media in China.

The recent actions by thousands of drivers in Shenyang, Qingdao and Nanjing have been portrayed as protests against Uber, Didi, Kuaidi and their ilk. But while cab drivers are undoubtedly unhappy about the use of taxi apps, their fundamental grievance is and always has been with the cab companies and the contract system (承包制) which forces them to pay a sizable deposit and monthly leasing fees (份儿钱) for the use of the vehicle.

Taxi drivers outside Nanjing High-speed Railway Station on 8 January in protest at high leasing fees.

The cab companies can arbitrarily raise the monthly fee, while the driver has to cover the costs of fuel, maintenance and repairs. Drivers are often considered to be self-employed and get few if any employee benefits. In major cities the leasing fee can be around 10,000 yuan a month, which means drivers have to work 12 hours a day, every day of the week just to get by. If business is slow, as was the case during the government crackdown on prostitution in Dongguan last summer, drivers can sometimes take home less than a local factory worker.

With earnings so low, drivers understandably get angry when their business is poached by unlicensed cabs that are not subject to same burdensome regulations as they are. A brief examination of the hundreds of taxi strikes over the last few years shows that competition from unlicensed cabs has been one of the primary causes of protest. The use of taxi apps is merely the latest manifestation of unfair competition in the transport industry.

The problem of unlicensed cabs is exacerbated by the inability of local governments to effectively regulate the industry; their failure to ensure that there are sufficient cabs to meet local demand, that fares are reasonable, and that drivers can earn a decent living without risking accidents because of overwork.

A recent example of local government incompetence can be seen in Nanjing where thousands of drivers in Nanjing are now out on strike demanding that the monthly leasing fee be reduced from the current level of around 7,000 yuan to a more affordable rate. Just last year, the authorities added several hundred new taxis to an already over-saturated market to make sure there were enough cabs during the 2014 Youth Olympics. Those cabs were simply abandoned in a vast parking lot after the games. See photo from Phoenix News below.

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