Miscellaneous / Socio-economy

Improving Malaysian taxi service

Yesterday’s news in Cars, Bikes, Trucks gave some hope in one of the most problematic public transportation here in Malaysia, specifically in our capital city, Kuala Lumpur. I even wrote about it a couple of years ago where a few bad apples in the taxi service industry have tarnished the image of this country.

Thus it is encouraging to read the news:

SPAD Plans to Merge Taxi Companies

The merger of taxi companies in Malaysia is on the cards.

According to the chairman of Land Public Transport Commission (SPAD) Tan Sri Syed Hamid Albar, the proposed move to merge the cab companies would only increase the competitiveness of the public transport industry.

“If you remember the financial crisis in the late 90’s when the country was hit by economic downturn, several banks were merged to strengthen the financial institutions. This is the same formula for the taxi industry,” he said at a press conference after hosting meet-the-taxi-driver luncheon session for 500 cabbies at SPAD headquarters in KL Sentral today.

He also added that SPAD would standardize allocation and distribution of individual taxi permits as well as leasing as part of an effort to restructure the industry in the upcoming National Land Public Transport Masterplan.

“There are 45 per cent individual taxi permits out of the 37,000 taxi permits at present in Klang Valley. SPAD is scrutinising the whole range of individual taxi permits to ensure that the standard of service of the taxi drivers will continue to improve,” said Syed Hamid.

Cars, Bikes & Trucks learned that more details of the merger and restructuring of the taxi services would emerge when the government will host another round of meet-the-cabbies session soon.

Syed Hamid also added that since 2011, no new taxi permit was issued by the commission in view of the high number of taxi drivers in the country.

The taxi-to-passenger ratio for Klang Valley cabs is considered as among the highest in the world with 4.8 taxis against 1,000 populations.

This is in contrast New York City’s 13,237 yellow cabs in 2011, a ratio of 1.6 against 1,000 people followed by Hanoi at 2.2 per 1,000 persons, Jakarta at 2.65 per 1,000 populations and London at 2.8 per 1,000 people.

“The commission discovers that sizeable numbers of taxi permits are inactive or dormant. Most of these cases involve individuals, associations and organizations that received the Special Approval Letter (STK) in the past but failed to operate over a period of time,” he said.

In addition, he said, SPAD is currently negotiating with cab operators to standardize the existing hire purchase practice because “there’s a wide range of rental rate, between RM45 to RM15 per day.

Syed Hamid also said the commission won’t seize the taxi permit without a valid reason and “will only retrieve the dormant permit.”

“If the permit holders do not have the financial capability to purchase a new taxi including insurance, maintenance and so forth, SPAD will try to assist them to obtain loans from financial institutions,” said the commission supremo.

I won’t delve further on to something which is not yet certain but merging taxi companies will surely be a good thing. Actually the best case scenario is to follow the history of RapidKL buses.

Back in the day before RapidKL buses existed, even before the now defunct bus operators of Intrakota and Cityliner plough the routes, there were many bus operators in the Klang Valley. We had Len Seng buses, Len buses, the Selangor Omnibus, Sri Jaya buses etc. We also had the highly dangerous speed demons called Bas Mini Wilayah.

This scenario is very much akin to the current taxi industry where there are too many players and laden with poor service.

What happened to the bus service industry was, Prasarana bought over Intrakota and Cityliner in 2003 (while retaining those two as operators) and they began operating as RapidKL  in 2006.

As the result, there are synergy in the efficiency of resources where profitability of the routes increased, better service all around, timeliness has improved and a more manageable supply and demand.

Compare our current bus service to the one we had in the 90s and we can see huge improvement.

Therefore the merger of taxi operators should be something to look forward to. Just from the news report above we can see red flags all over the place. Too many dormant permits, too many taxis (disrupting the supply and demand), problematic hire purchase practice, and 45% of 37,000 permits are individual permit holders. That means, there are possibly 16,650 taxi drivers trying to survive on daily basis with meagre income.

Apart from bad service by some taxi drivers, the industry itself is rife with other problems such as political interference and alleged corruption in giving out taxi permits.

All these have to stop now.

Since the advent of ETP where the government is cultivating greater cooperation and initiative from the private sector, it would be good if there are highly experienced and financially capable companies to back this plan. If there is one flagship (let’s skip the Intrakota and Cityliner busines model) much like RapidKL to operate the whole taxi industry in the city centre, then there will be synergy which will benefit the end users.

Imagine if for example, RapidKL takes over all taxi operating companies and all willing taxi drivers are employed as full time staff. The management can then plan the routes and areas with greater efficiency. There won’t be any overlapping of supply, connectivity of residents in Klang Valley will be maximise. From residential areas where there are no RapidKL buses, there will be taxis to pick up passengers to LRT Stations. Or taxis will only travel the routes where there they will not overlap the LRT or monorail routes. Taxi drivers are paid salary instead of relying on meter fares. Thus decreasing the risk of taxi drivers cheating customers. Disciplinary action can be taken to errand taxi drivers and dealt with more effectively since they are full time staff. Above all, there is no more need to issue taxi permits.

Well this is just a suggestion; from an outsiders’ point of view.

Better connectivity is what is missing in our public transportation industry.

But if RapidKL has too much on its plate then there are other private conglomerates in the automotive industry that can surely operate this kind of business. What is important is the need to standardise and improve the service immediately. Otherwise the whole industry will jeopardise our reputation as one of tourists’ favourite destination.

32 thoughts on “Improving Malaysian taxi service

  1. And they want cheaper car, as it is I am suffering everyday trying to come out of Selayang, sometimes even during weekend, no thanks, especially those coming out of Kepong/Segambut (do your maths) into Jalan Kuching/Ipoh. A house with three/four/or more cars. Sheesh. Thanks for highlighting this, JMD.


    • Taxis are not a luxury. Taxis are a necessity. Until and unless the whole system of public transport is improved such that people have more choices to go places within cities.

      And until the idea of commuting by trains, LRTs, buses etc become a norm in Malaysian society. Many still feel it “low standard”, “not befitting one’s social or economic status” going on a bus or on LRT. Think about that – how many of our people still think like that, how many of those with ties on ride the buses and the LRTs.

      And until people realize the idea of walking short stretches is a damn good exercise and is good for health, what with the percentage of obesity increasing every year. No doubt the heat may make some people easily sweat profusely (some may not even like to “sweat” preferring only to “perspire”!) and may look unkempt at the meetings they are going to. But there is no need to walk fast like the Westerners do in cold winter, enough to just take an easy stride for 10-20 minutes. Try those especially when you go shopping – you are not out to impress anybody, so, never mind even if you “perspire”.


  2. RapidKL should not dive into this. They are a GLC and the risk is too big. Taxi business is a shaky business. I’d rather see a company like Naza or Spanco do it. No public money will involve. Naza already has its own taxi and airport limo division while Spanco is experienced in fleet management. Don’t let RapidKL lose our money.


    • Yes, merge the taxi companies that have been issued licences to operate a fleet of taxis but are not running them properly. Get rid of the irresponsible drivers, force the newly merged company to propose and, after approval, undertake to adhere to strict guidelines on recruitment of drivers and monitoring staff.

      It’s high time we have a decently run taxi service in this country. But those individually run taxis must be allowed to continue. Check and have a database of all such taxis, and ensure only the genuinely owner-driven ones are allowed to continue operating.

      These self-driving taxi owners are serious about their business, care for their vehicles, are not likely to do daredevil driving, and are genuinely concerned about the ADUAN notice and phone numbers painted on their vehicles. Get rid of the licenses issued to individuals who “pajak” or “sewa” their vehicles or licenses. A lot of problems stem from them.


      • I agree SPAD withdraw those licenses issued in the past but not utilized – likely owner-operated kind.

        If replaced with new ones, make sure only to good, owner-driving applicants. And merge the smaller fleet owners to ensure a reliable selection of drivers – drivers are often the key to a good taxi service.


    • Where privatization and private sector services are efficient, do not bring many complaints from the public and do not cause a bad image of us to foreign visitors, let them continue, encourage them.

      Where they are not, public transport operations may take over. No harm for RapidKL to operate. The market is big enough, surely.

      Not all public enterprises lose money. Otherwise there;d be no Petronas, Telecoms, Tenaga Nasional, etc. And where in the world can we find public funded enterprises not ever losing. Ever heard of BOAC, Lufthansa, etc? Even huge private US airline companies also folded – Pan-American is an example.


      • Correction:

        Lufthansa is still operating but here are news bits on European government-funded airlines that folded:

        – Spain airline suddenly collapses – http://www.bbc.co.uk/news/business-16787761

        – Europe loses four airlines in an unhappy start to 2012 | CAPA …
        centreforaviation.com › Aviation AnalysisJan 31, 2012 –

        As the economic noose tightens around European airlines, the … weak carriers in Eastern Europe urgently seeking further funding and/or new investors in the near term. … The announcement followed the Government taking measures to …. the carrier noted that operations have ceased “due to the company …


  3. I think there is a contagious disease affecting Malaysians turning them into zombies who just anyhow follow and follow, listen and listen…..
    The opposition supporters will oppose and oppose while those with the government will support and support.
    During the time of Seri jaya and mini buses, I can board a bus within 5 minutes from my house to town. I don’t really are if the buses are overcrowded. The fact is I can get to my destination on time.
    Nowadays, I don’t bother as the busses are irregular. Even te ones serving inner city areas are on a 15 minute schedule, like the GO buses when it should be more frequent.

    The plight of our taxi drivers are never taken into consideration by the morons in power. Simple things like allowing airport taxis take passenger to and fro are from city to airport are forbidden. So these guys must work twice as hard to earn a decent living. A prostitute earns much more without having to buy or lease a taxi.

    When intrakota and city liner were introduced into the network, the other companies were forced to sell off cheaply or close down. Those buses like Selangor omnibus and seri jaya, Len Seng etc were running perfectly ok but were denied their right to increase bus fares and had to pay hefty import taxes for their buses. But when the cronies got their license to operate, the fares sent up, service went down and still they cannot make money. Rule number 1, do not give to retards who come from kampung schools that does not teach you simple mathematics.
    And when they failed, gahmen was forced to bail out these companies. What the gahmen got were rubbish buses and yet some idiot here called it a success.


    • You said, “Simple things like allowing airport taxis take passenger to and fro are from city to airport are forbidden. So these guys must work twice as hard to earn a decent living.”

      How sure are you that the fare they are allowed to charge from the airport to KL and the trips they make per day do not give them a decent living? Instead of making the usual Opposition wild allegations, why don’t you make some calculations on average income per working day, costs to run and maintain their vehicles, toll etc and produce them here? Then you’ll be making sensible comments.

      You familiar with prostitutes to know they “earns much more without having to buy or lease a taxi”? How often do you visit them?


  4. Agree with making taxi drivers as full-time staff.

    They should also manage the taxi as a zone (fixed rate per zone). If customers want to cross zones then they need to change taxi at a specific hub (preferably near LRT station).. Then they can forget about using meters altogether.. The taxis shd be colour-coded according to zones.

    Since the taxis belong to the company, the company can assign the drivers according to availability. As such, nobody is allowed to make the taxi as an extension of their house.. with funny decorations.


    • I don’t agree taxi drivers be allowed to forget using meters altogether. Chaos if they do. Enough problems already when the rule says they have to use meters, yet they don’t. Zoning might complicate the situation and used as an excuse to fleece passengers.

      During busy hours, they simply fix a rate and refuse to take passengers who don’t agree. Try the taxis at the Mega Mall during busy hours and see the kind who impose their own rule,

      SPAD or other Enforcement Officers should make it a SOP to go to the taxis who are seen haggling with passengers. SPAD etc should announce to the public periodically that they should just enter the taxis, without asking if they would take the passengers to the destination given. They should state the destination only after boarding the taxis.

      Enforcement Officers should station themselves at long queues for taxis, changing places every so often. And don’t get driven there by vehicles carrying the names SPAD or wear uniforms or dresses identifiable with Enforcement Officers.


  5. If we end up having among the highest taxi-to-pax ratio in the world with 4.8 taxis per 1,000 population, the problem clearly was with the permit-issuing authority. It appeared to have been the indiscriminate issuing of permits without checking the ratios existing in major cities in the world. It could have just been googled.

    The problem may be the Officer in charge and the committee deciding on permit issuance (assuming there was one) being dumb or not standing up to being bullied by political big weights sending notes or words passed through the system asking supporters in their constituencies be given such permits. And we therefore hear such things as permits issued for fleets of taxis being run in the name of sections of political parties e.g the red and white taxis.

    A lot of those could have happened during the “flip-flopping, auto-piloting and sleepy” Tun Dol’s administration. Good that the authorities have realized the folly and no permits were issued in 2012. And we await the new measures being planned by Syed Hamid. And hope that what is being planned will translate into a real, long-lasting solution to the many problems besieging the transport system in the Klang Valley etc. I am reminded of my Professor who periodically ended up his lectures by saying, “Theory always differs from practice.”


    • My hope is one day we’ll have buses always running on schedule, taxis driven by honest and polite drivers, orderly traffic, etc.

      But how to have that situation when a host of problems exist – DAP even opposes the AES which can help reduce accidents that cause traffic jams and bring out bad temper among drivers.


  6. This thing often dubiously described as “the human element” brought about the axiom “Theory always differs from practice.”

    It is more fittingly explained as human weaknesses, corrupt minds, lack of responsibility, malingering etc. The Officer(s) responsible may not have his finger on the ball and lets the Clerk or Assistant prepare unchecked the list of permits recommended to be given out and brought to the permit-issuing committee for decision. Long lists that reach hundreds at a time. And no thorough checking on the background of those applicants by the Officer. The Clerk or Assistant may slip in several names of his relatives, friends or those offering money. Then you end up with those “sizeable numbers of taxi permits are inactive or dormant.”

    Similar human weaknesses, corrupt minds, lack of responsibility etc occur in the selection of drivers or the “renting out” of taxis by the fleet operators. The rough and daredevil kind, including the less disciplined ex-Army personnel (note that many of them are good), end up driving many taxis in the Klang Valley. Refusing to pick up short-distance passengers, not using meters, cheating tourists by using longer routes to destinations than they should, not abiding traffic regulations etc.

    But give credit where credit is due. The authorities did take the necessary measures from time to time, including insisting on proper attire when driving taxis. I would however urge the authorities to always look at both the permit-issuing part as well as the permit conditions enforcement part in their efforts to improve the taxi service in the Klang Valley and elsewhere.


    • The London cabs always appear orderly, easy to get, I haven’t heard cases of fleecing passengers. The cabbies say there have to pass a stringent test to ensure they know London roads fully.

      Wonder if KL cabbies are licensed and required to pass tests on knowledge of KL and suburban roads.


    • Neither have I experienced or heard of rude London cab drivers.

      I only heard the joke on the first time Malaysian visitor, not familiar or confused with the exchange rate, lacking sleep after a 13 hour direct flight, tipping the driver miserably, and got the coins thrown back to them, with the words “Keep them, your needs are greater than mine”!

      Talk about it takes all sorts to make this world, there are are also “private taxis” to go to Heathrow airport from London. Maybe they are the equivalent of “private sapu” taxis in Malaysia, now not so prevalent than, say, 10 years ago.


  7. “If the permit holders do not have the financial capability to purchase a new taxi including insurance, maintenance and so forth, SPAD will try to assist them to obtain loans from financial institutions,” said the SPAD Chairman.

    Now, that’s rakyat-friendly. It should translate into votes.

    Unlike PR Selangor. Promised RM100 p.m allowance for single mothers also did not deliver. All these 4+ years.


  8. If I have something to say about this, the service needs a serious shake-up. It has been a while, I think, where there’s no serious attempt to keep it in order and regulate it the way other places doing it like the London does with its trademark black taxis and the New York taxis. Yo can’t let the street of KL overpopulated with cabbies jostled for passengers in an increasingly tough environment. With the car business hits record sales according to AAM and a brand new light rail transit set to scoop a handful of passengers in the near future, then what gonna happen to taxis?. The urbanites have more choice now and I think SPAD does the right thing to step in with a strategy. When things look pretty mess up, it’s their job to come in to fix it before its too late so that the system is properly regulated.


  9. Those blaming just the taxis for maddening traffic conditions need to think again.

    Big cities like London and Tokyo, a large number of the workers in the city live in the outskirts, up to 40 miles away.

    THey commute by train. leave their cars at the railway stations where they live. Any attempt to encourage this development by the authorities here?


    • The authorities have built the commuter trains. Klang-KL, Seremban -KL- Kuala Kubu Bahru (Tg Malim now?) etc. Good.

      But do many Malaysians value “life in the countryside” – in the kampongs – like many Japanese and Britishers do? Such that they don’t mind at all waking up earlier and dozing off on trains during the 1 hour train ride home, reach the station nearest home, then drive from the station to the kampong where they have an acre-size compound with durian trees etc?

      If so, maybe less congestion in the cities.


  10. Yes, it’s values, it’s ways of life, it’s life styles.

    It’s thinking, it’s attitudes that make what we are. That causes the maddening traffic and transport system in the country. And we even oppose the AES, designed to lessen accidents and improve traffic conditions. We meaning DAP, that is.

    Overall, each and every one of us are responsible one way or another. Not least by voting in those who rule and those who oppose. Many are responsible, a few are corrupt, yet others oppose simply for the sake of opposing.

    And one, in particular, tries to create havoc by breaking up the unity of the largest ethnic group in the country, arranged for funds from outside the country to NGOs that seem to want a revolution Arab Spring style. In the process, made many drivers of the public transport system adopt devil-don’t-care, anarchistic attitude in driving habits, keeping to schedule, to traffic rules, to courtesy to passengers etc.

    But let’s pat ourselves in the back a bit. No such things as Arab Spring happening, as we have been having elections every 4-5 years, unlike Egypt, Libya, Syria etc. The vast majority of us are sane, rational thinking and peace loving citizens. And those holding offices continue to find ways to improve things in the country. Like on the transport system, as written above.

    Saying “Well Done Malaysians” is quite in order.


  11. Yes, sir, “standardise and improve the service immediately.”

    Then don’t vote in Pakatan Rakyat. Coz in Selangor they de-standardize the Alam Flora garbage collection, and created endless sampah problem. Until now.


  12. “If there is one flagship … to operate the whole taxi industry in the city centre, then there will be synergy which will benefit the end users.” –

    I believe no intention of getting rid of the owner-driven taxis. I agree with the opinion that they are usually the good ones and should be allowed to continue running their taxis.

    If need be, don’t issue new owner-driven licenses and they will die out. Just ensure the drivers recruited by the flagship are good ones.


  13. Saya kesian kat drebar teksi yang ikut Himpunan Bersih 3.0 dan mati dekat KLCC tu. Kesian, tapi bila fikirkan, saya rasa itu lah jenis drebar taksi yang kita tak mahu.

    Kalau tak silap saya baca, dia mati lemah jantung, badan berat, banyak kolesterol kot. Memang lah, kalau tak eksersais, asyik dok dalam teksi saja, makan kari dan telor banyak macam arwah Tan Sri P Ramli (kesian dia), kolesterol pun naik, lemah jantung, bila kuat stress, meninggal.

    Kot si drebar teksi tu banyak kolesterol, jenis nak marah saja, sampai ikut berdemo. Saya bayangkan dia jenis yang tak semenggah di jalan raya, silap silap maki orang selalu, potong jalan, masuk keluar lorong.

    Amacam kalau derebar teksi di perlukan pihak berkuasa supaya periksa doktor setahun sekali ke dua kali ke?


    • Kalau banyak eksiden berlaku di sebabkan drebar kurang sihat, bolehlah SPAD perlukan drebar periksa doktor setahun sekali ke. Eksiden sebab drebar mati di stering tak mungkin, tapi sebab pandu tak betul kerana darah tinggi asyik nak meradang aje, tak tahu lah.


  14. “.. sizeable numbers of taxi permits are inactive or dormant. Most of these cases involve individuals, associations and organizations that received the Special Approval Letter (STK) in the past but failed to operate over a period of time,”

    Wonder what the “Special Approval Letter (STK)” was and why issued. But good that SPAD is taking comprehensive action.

    I wanna see London or New York-like situation, just enough taxis as not to allow tak cukup makan situation and giving excuse to fleece pax, tak mahu angkat pax for short trips, pax always have to ask whether can take them to their destination, when taxis should be taking pax without question. .


  15. Tapi ada golongan yang public transport nak lalu depan rumah dia,marah2 kan kerajaan,bila lalu depan rumah orang lain takpe.Sampai nak saman.Inilah pencacai yang cakap tak serupa bikin.Mengutuk public transport tak efficient,bila kerajaan nak bina landasan LRT,mula bising,sebab mengganggu ketenteraman Taman perumahan “elite” mereka.Tapi kalau lalu depan setinggan atau taman perumahan lain ok je.


    • Itu jenis yang di panggil ultra kiasu. Macam yang bantah steshen LRT di Petaling Street tu. Nak suruh buat tempat lain pulak. Rosak perniagaan konon. Nak senang sendiri saja, tak mahu orang lain senang. Nak depa saja yang menang, orang lain tak boleh. Mana boleh macam tu. Kena berpatutan lah. Ada menang ada kalah di dunia ni. Kalu tak, pi duduk di Maret le.

      Pastu yang orang punya pun depa nak.Pi hebohkan Malaysian Malaysia konon. Nakkan sama rata tapi tak mahu akui Kedudukan Istimewa Melayu dan Bumi Sabah dan Sarawak. Pada hal dah janji (sefahaman) dulu – depa dapat hak kerakyatan, Melayu dan Bumi dapat Kedudukan Istimewa. Awat nak ngaku rakyat Malaysia lagu tu.

      Orang nak kurangkan sesak lalu lintas, tak penuh taxi dll di jalan raya, adakan LRT, tak mahu sokong atau kerjasama pulak. Jenis tak baik sungguh le depa ni. Nak kena desingkan telinga depa selalu.


  16. I see people are exploiting DS Najib’s eagerness to get votes these days, asking this and that from the Government. Including more taxi licenses isued to individuals.

    Hope SPAD will carefully consider the ratio of population to taxis and the ratio of company-run taxis to individually run ones.

    New Year jams on the road are always crazy. Can’t blame only on the taxis.


  17. The answer to all these taxis woes is to increase the fare of these taxis. Imagine a whole car and a driver driving you up to your doorstep, the expenses they have to incur in the taxis upkeep. Working till late at night, ect. just to earn a decent living. If we don’t want to pay then take a bus. Please don’t deprive them of a good living. I have been all over the world and taxis are expensive except in Malaysia.


  18. Taxi Business is good business.

    Cost of Proton Saga as Taxi RM20.000.00 minus duty
    Cost to convert to Taxi RM 5,000.00
    Cost on Maintanence over five years per taxi RM20,000.00
    Administrative espenses for five years per taxi RM5,000.00

    Total Cost for Five Years per taxi RM 50,000.00

    Income on Taxi

    Taxi Driver when sign contract must pay RM5,000.00

    Cost of rental for five years @RM50.00 a day

    RM50.00 x five years or 1,835 days = RM91,750

    Total imcome RM 96,750
    Expenditure RM50,000

    Profit per Taxi RM46,750 over five years. That is good return for no investment in Taxi because the RM 5,000 paid by taxi driver on signing the contact is sufficient to make down payment to EON to get the car out. Giving the taxi to driver after five years without the Lesen is no big deal. To be fair the diriver of the taxi must also be given that Lesen to operate a new taxi.

    So who says taxi is bad business.. I am not an accountant so the figures may not be accurate. Those interested could make a detailed study.


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