The influence of app-based ride services on the survival strategies of formal metered taxi operators in the Cape Metropolitan area

Abstract

Public transportation plays an integral part in the country’s development. The South African government placed a high priority on improving access to opportunities in the transportation industry, particularly in the traditional metered taxi industry; this industry plays an essential role, especially in the context of local and tourist passenger transportation. As most industries are influenced by the evolution of new technologies, the metered taxi industry is certainly not exempt from this phenomenon. The entry of mobile technology’s application (app)-based ride services, such as Uber and Bolt, into passenger transport markets in the Cape metropolitan area has negatively influenced the business sustainability of traditional metered taxis, particularly its market share. This research investigated the influence of app-based ride services on survival strategies of formal metered taxi operators in the Cape metropolitan area to examine the survival mechanisms of traditional metered taxi operators toward the implementation of app-based ride services (Uber and Bolt). The mixed methods approach was selected because it allowed the researcher to measure variables to illustrate essential strategies for traditional metered taxi operators for sustainable operation in contemporary transportation. The data was collected from 80 respondents and 20 participants by way of a questionnaire and an interview guide respectively. The quantitative data was the analysed using Microsoft Excel while the qualitative data was clustered around the themes the emerged during analysis. Presented in the form of tables, figures and word verbatim quotations, the results of both methods were integrated to answers to the research questions. It was found that app-based services (Uber and Bolt) do negatively influence traditional metered taxis’ business sustainability within the Cape metropolitan area through the implementation of high standard services and the use of comfort vehicles. Regarding traditional metered taxi strategies in the Cape metropolitan area, it was found that current app-based services’ business strategies, such as app technology, private new vehicles, and cheaper rides, are negatively affecting traditional metered taxis’ strategies’ sustainability. It was recommended that, for traditional metered taxi operators to maintain business sustainability and market share against app-based ride services, vigorous implementation of a similar app technology to match app-based service flexibility must be implemented. The research concludes that passenger transportation is essential mostly for bigger cities, such as Cape Town, particularly for local and tourist transportation, in order to maintain social development. Nevertheless, some of these services, such as app-based services (Uber and Bolt), are enjoying a robust advantage that is upsetting the survival of traditional metered taxis around the Cape metropolitan area.