Fuel Prices Cutting into Driver Profits: Are EVs the answer?
Crude oil prices have risen to their highest point in a decade and the conflict in Ukraine means household energy prices are climbing. Drivers across the country are battling both the cost of living and fuel prices. This ultimately means longer hours for less pay.
Despite fuel costs stabilising in recent weeks, fuel retailers have been heavily criticised for not passing on the price reduction to customers.
Rising fares
The taxi and private hire trade have been pushing for fare increases over the past few years. The impact of the coronavirus pandemic has meant that many drivers are already struggling to make as much money as they were pre-pandemic. Recent events mean they are feeling the pinch even more.
In the past, we have seen some licensing authorities resistant to increasing fares. But they now recognise that a price increase is necessary to ensure the survival of the industry.
In some parts of the country, fares have been increased by nearly 15%. This marks the biggest increase in fares in recent memory. The Licensed Taxi Drivers Association (LTDA) report that cabbies in London are waiting on ranks rather than looking for passengers. The cost of diesel means that actively searching for business isn’t worth the cost. Can EVs help you save?
Can EVs help you save?
As the price of fossil fuels increases, electric vehicles (EVs) are definitely becoming more attractive. Our friends over at TaxiPoint crunched the numbers and found there are potentially massive savings to be had.
Over the course of 5 years, using a LEVC TX electric taxi could potentially save drivers close to £18,000! In the long term, the savings will clearly outweigh the initial outlay for an EV.
Making the switch
It’s clear in the long run there are massive savings to be had over the lifetime of having an EV. That makes them the ideal choice for drivers early in their career, as they have the opportunity to reap the savings benefits. For drivers closer to retirement the savings in fuel don’t necessarily outweigh the other associated costs of EVs. This will be something that many drivers will consider when debating whether to make the switch to EVs.
Other barriers to EV ownership include the lack of charging infrastructure in certain areas. It’s all well and good investing in an electric taxi but if you can only charge it at home it becomes a less viable option. Research carried out by TaxiPoint, last year, found that 64.8% of EV taxi drivers considered the charging network in their area as poor or very poor.
In some areas, the infrastructure is there, but drivers haven’t been able to afford to make the switch to EVs. This has been the case in Coventry, the ancestral home of the black cab Following a £1.2 million investment in 2018, 39 charging points were introduced to the city. But despite financial incentives and ‘try before you buy’ schemes in the area, only 26 electric taxis have been purchased since.
The licensing authority has admitted that cost is the major barrier for people switching to EVs. The lack of a substantial second-hand market means that even used EVs can be prohibitively expensive.
For many people, there just isn’t enough incentive for them to make the switch at the moment. The majority of the industry does want to make the change but with everything happening in the world right now, many have plenty of other costs to consider.
In the next episode of our What Time You on ‘Til? podcast, we catch up with YouTuber, Tom Hutley, better known as Tom the Taxi Driver. As an owner of an electric taxi, we get his opinion on how the industry is coping with the switch to cleaner vehicles. You can catch the most recent episodes here.