The taxi industry is a force to be reckoned with

Imagine a public transport system comprising every travel mode – the taxi, bus, train, airliner and coastal passenger ship – which is interconnected, not only through clean world-class terminals with black-owned banking and shopping malls, but also through a smartcard system that can be used for all.

Like the Gautrain concept, it was discarded as a pipe dream by skeptics more than 10 years ago when former minister of Transport Mac Maharaj came out with his “Moving South Africa 2020” agenda – a visionary strategy that focused primarily on the integration of land transport modes from both a passenger and freight transportation point of view.

Part of his plan was to recapitalise the taxi industry in the process; he called on taxi bosses to stop feuding and killing one another (and passengers in the crossfire) over territories, and to form a body that would be representative of it, which would get its house in order and one with which he could negotiate to see the taxi part of the vision come true.

Friday, 16 September 2011 must have been a happy day for Maharaj, now the official spokesperson for President Jacob Zuma, when the South African National Taxi Council (Santaco) – which he had prodded into being from various ragtag associations – celebrated its 10th anniversary by launching the first flight of Santaco Airlines from Lanseria Airport.

Happy also because Santaco revealed plans on that happy occasion to go into seaborne passenger transport; that along with other disclosures, it further planned to provide ancillary services such as intermodal passenger terminals under black-owned shopping malls and establish its own bank, which obviously would have to adopt a smartcard system – a smartcard with a captive travelling market!

As Nedbank would say: Makes you think, doesn’t it?

Maharaj’s new boss was present at the launch and beamed from ear to ear as he and other VIPs posed in front of a Boeing 737 with a maroon stripe over a white body.

The first flight was overbooked, on board being President Zuma, Gauteng MEC for Roads and Transport Ismail Vadi, Transport Minister S’bu Ndebele, Eastern Cape Premier Noxolo Kiviet, other Members of Parliament and Santaco bosses.

Said the president before he and the party took off: “When addressing a black business summit last week (6 and 7 September), I said we need to start seeing tangible results of economic transformation and freedom. We said black people, women and persons with disabilities need to visibly enter the economic sectors that were closed to them before, such as manufacturing, so that we could see the rise of new black industrialists.

“Today we are celebrating such an achievement. A sector that was branded by some as never going to be able to progress to even own fleets of buses, has leapfrogged into the aviation industry by owning an airline.”

Members of the taxi industry already “own” and run the Rea Vaya bus services which, as President Zuma spoke, was paralysed by a seven-week strike by former taxi drivers.

If all goes according to plan, Nkululeko Buthelezi, the business development officer of Santaco, will be a busy man. Prior to working for Santaco, he was the group chief executive officer of South African National Transport Solutions – a transport training agency that was responsible for getting the various Gauteng taxi associations in on the 2010 Fifa World Cup “park and ride” systems.

The Santaco airline is a proposed new low-cost carrier operating a daily flight to Johannesburg, Bhisho (in the Eastern Cape) and Cape Town. This will make it South Africa’s fifth low-cost carrier, after Velvet Sky, Mango, 1time and Kulula.

“Flying still remains largely for white people. It is not because black people cannot afford flight fares, but the issue is how to get there (airports) if you don’t have your own car. Metered taxis are very expensive. Our airline cost will have a flat fee structure, which will range between R500 and R600,” said Jabulani Mthembu, the president of Santaco.

Having previously operated in Iraq, AirQuarius Aviation is to partner the taxi council. The plan is for 100-seater aircraft (this probably implies they plan to use AirQuarius’s Fokker 100 jets, which can seat up to 107 people) to be supplied and operated initially by AirQuarius Aviation (which has the crew and aviation licences), which would transfer skills to Santaco over an 18- to 24-month period.

Door to door

Buthelezi has described the airline venture as a door-to-door service, allowing a traveller to take a taxi from near his/her home to Park Station, enter a special taxi rank section for Santaco passengers, book in, hand in baggage, obtain a boarding pass, go through security, and travel by taxi to Lanseria to be received by the ground crew and then board the aircraft.

When the passengers land, they and their baggage will be taken on a shuttle to the taxi rank in Bisho, which is to be developed into a major hub.

The Lanseria-to-Bisho route will be the first, and others will be considered only if Santaco can be convinced that traffic between the two provinces is guaranteed to produce a load factor of no less than 80%, compared with the international 66% load factor to break even.

Expanding flights to other Southern African Development Community countries will be considered on the same basis; and as soon as the African Union could get countries to agree on freeing up the skies from stifling rules.

For funding, the first phase will be to sell shares to Santaco members at a date to be announced “in due course”, with the second phase offered to private investors. The third level of capitalisation will be a listing on the Johannesburg Securities Exchange, according to Buthelezi.

Aviation in South Africa is strictly controlled; and in aviation circles, there is no doubt that the South African Civil Aviation Authority will ensure the airline is properly run to the same rules and regulations as other airlines.

Santaco itself is undergoing a process of modernisation and restructuring. To modernise itself, it has hired an entire team of professional businesspeople including former bankers and financial planners who understand what Santaco wants to achieve.

The clout of the industry – and therefore Santaco – to achieve its objectives is considerable. According to official government information based on the previous census and estimates, public transport by taxis accounts for 65% of the transport total, 20% by bus and 15% by rail.

The taxi industry, in turn, consists of minibuses dominating 90% of the market, and metered taxis active in the remaining 10% of the market.

Described as South Africa’s “economic backbone”, the non-metered minibus industry consists of approximately 150 000 public minibus taxis, generating an estimated R16.5 billion in revenue each year.

The industry is a major player in the public transport industry, carrying an average of 15 million passengers a day countrywide. It is by far the single largest and most accessible service provider in the public transport industry.

Annually, it spends R15bn on fuel, R10bn on vehicles and R150m on tyres.

The taxi industry is probably the most reviled in South Africa, however. It has suffered many strikes, which often turn violent. The average minibus taxi is notoriously unroadworthy and, according to the Automobile Association, involved in some 70 000 accidents a year, with dozens of people dying en masse on South Africa’s perilous roads.

To shake off this reputation and strive for new objectives, Santaco last year launched its TR3 2020 Strategy, which involves redefining, restructuring and repositioning the taxi industry in order to achieve tangible outcomes such as safe taxis, as well as intangible outcomes such as embracing good customer-client attitude and relationship.

Battle

The battle to make the taxi industry safer is being fought from two fronts: improving the safety of the vehicles, and bettering the skills of the drivers who take them onto the roads.

The government, through the Department of Transport, has responded by committing itself to set up new academies to train taxi drivers. Last year, about R5m was allocated toward this project.

Santaco now wants to start a training academy, the first project of which will be to train 100 women drivers from all the provinces. When they complete their training, they will be exchanged for 100 more (untrained) drivers to be trained at the academy to inspire more drivers to be instructed.

Last year, the brandhouse/Road Traffic Management Corporation No. 1 Taxi Driver Campaign, which was launched during the Fifa Soccer World Cup, drew more than 50 000 taxi driver registrations from about 450 participating taxi ranks nationwide, and educated and tested more than 2 240 taxi drivers throughout the country – almost double the figure of the previous year.

It involved a practical testing phase; and the feedback from the Toyota Advanced Driving Academy instructors was that never before had they experienced participants who were more interested in what they were learning.

This was followed by Santaco’s much-lauded Operation Hlokomela campaign in November 2010, which saw Santaco technical safety specialists visit taxi ranks across the country to inspect the safety standards of taxis. During these technical safety inspections, Santaco’s representatives advise taxi owners and operators on general rules on road safety and customer care.

The campaign was intensified in May this year in support of the Decade of Action for Road Safety 2011–2020 launched by the National Department of Transport, with Toyota South Africa Motors assigning technical specialists to the campaign to train Operation Hlokomela representatives on vehicle inspection techniques and safety assistance.

Together with its main aim of fleet renewal, the government’s taxi recapitalisation programme brought with it a set of new safety requirements, subject to regular review.

One of the regulatory requirements now being enforced is that all new minibus taxis should be fitted with an emergency escape hatch in the roof. For example, the latest version of Toyota’s best-selling Ses’fikile – released for sale in mid-August – fully meets this requirement and leads the way in regulatory compliance.

Selling more than 1 000 units a month, Toyota has increased seating capacity from 14 to 15, and supplied vinyl seat covers in place of cloth in response to requests from operators.

In fact, having used many taxis over the past year as part of a personal study project in Gauteng and the Western Cape, I can vouch for the fact that the taxi industry has been improving slowly – not only in terms of safety, but also in terms of passenger comfort. However, there are still many old taxis out there that should have been scrapped long ago; as well as drivers – licensed and unlicensed – who have no respect for traffic regulations and the passengers they carry.

Hopefully, the recent clampdown on unroadworthy public transport vehicles at roadblocks, the training of drivers at academies, and a massive cleanup of our dirty, unhygienic taxi ranks will accelerate the improvements being made in the industry and lead to the achievement of objectives Santaco has set for itself.

As for Santaco wishing to get airborne and seaborne – it will not be Mission Impossible if the groundwork is done first.

Andy Cole