Taiwan Taxi Co (台灣大車隊), the nation’s largest cab service provider, aims to increase revenue contributions from advertisements, tourism, group shopping and other services, while doubling its fleet in the next few years, senior executives said yesterday.
The company, which controls a 14 percent of the market share nationwide with 12,000 cabs mostly operating in the Greater Taipei area, is scheduled to list on the GRETAI Securities Market on Nov. 7, with its initial public offering set at NT$72 per share.
“We intend to cut dependence on dispatch service fees as the main source of income and shift more focus to business potential linked to fleet members, such as advertising, group shopping and tourism revenues,” chairman Lin Tsun-tien (林村田) told an investors’ conference.
With a paid-in capital of NT$200 million (US$6.8 million), Taiwan Taxi posted NT$67 million in net income for the first six months, translating into earnings per share of NT$2.13, company data showed, compared with an EPS of NT$3.82 last year and NT$3.75 for 2010.
“We expect to enlarge the fleet from the current 12,000 taxis to 25,000 in a couple of years to strengthen the service network and earnings ability,” Lin said.
There are 87,000 taxicabs nationwide and all are prospective partners, said Lin, former owner of Arcoa Communication Co (全虹), a retail chain selling telecommunications products.
To that end, Taiwan Taxi is developing a living park in Yingge (鶯歌), New Taipei City (新北市), to attract more fleet members south of Tamsui District (淡水) as most taxis operate north of the river and in downtown areas, Lin said.
The park may increase members by 5,000. Members pay an average of NT$2,000 in dispatch fees per month, he said.
“The taxi fleet is a 24-hour outlet that may be used to explore various revenues,” Lin said.
He added that Taiwan Taxi had begun to offer oil changes and plans to enter the car insurance brokerage business as well.
The company also sees business opportunities in the growth of cross-strait tourism because cabbies could double as tour guides for individual Chinese tourists with more of them are allowed to visit Taiwan, he said.
Non-dispatch businesses underpins 60 percent of Taiwan Taxi income, with the ratio set to climb higher, as the company seeks to diversify earnings sources, president Joanna Lee (李瓊淑) said.
Lee voiced confidence earnings this year would exceed the level last year because the economic slowdown has very limited impact on the company’s operations.
“More taxis sign up for dispatch services in bad times,” she said.