HomeBusinessGas prices: How inflation is affecting cabs, ride share

Gas prices: How inflation is affecting cabs, ride share

As fuel prices set new record highs this weekend, taxi and ride share drivers have seen their fares rise as well in recent months as boards and companies approve increased rates and add temporary surcharges.

Cities across the country are seeing their respective transport authorities increase cab fares in order to help drivers affected by two years of the pandemic and the recent frenzy around gas prices, as well as other costs.

This includes municipalities from Halifax and Cape Breton to Ottawa, Calgary and Toronto.

In some cases, base fares have not increased in years.

Just this past week, Quebec’s transportation commission announced it too would increase taxi fares

“It is affecting the taxi drivers probably worse than a normal community person,” Mohan Kang, president of the B.C. Taxi Association, told CTVNews.ca in a phone interview on Sunday.

Unlike a private citizen, who if able to can simply leave their car in the garage, taxi drivers don’t have that luxury.

“The taxi industry is an essential service here now and been so especially during COVID-19,” Kang said. “For us, we have to be on the road to serve the communities.”

Back in March, the B.C. Passenger Transportation Board approved a cost indexed rate increase for taxis of 5.3 per cent.

The increase is based on the consumer price index, as well as the price of gas.

“At that time it was welcomed because anything which helps us to mitigate the rising gas prices would help the cab driver,” Kang said.

“But since then, the gas prices have not stopped going on and fluctuating.”

British Columbia has among the highest gas prices in Canada on average.

Kang says the only other option they have is to request a gas surcharge, which even then requires approval from the Passenger Transportation Board and is unguaranteed.

For now, he says they continue to watch the situation around gas prices.

In Kingston last month, cab drivers spoke out against a proposed fare increase with some saying it would hurt their competitiveness against ride share companies.

The local taxi commission later scaled back the increase.

When it comes to fares, Kang says there needs to be a level playing field for taxis and ride share companies, but operators also need to stay alive.

“It won’t last too long because no businessman, especially the small business entrepreneurs, which the taxi drivers are, can afford to pay from pocket to serve,” he said.

Some governments have proposed or put in place temporary freezes on the collection of provincial gas taxes.

Alberta did so in March and Ontario is expected to see its freeze come into effect in July.

The two most well-known ride share companies in the world, Uber and Lyft, are also adjusting to record-high gas prices. Each announced new fuel surcharges back in March.

Uber added a 50-cent surcharge on every ride and 35 cents to certain Uber Eats deliveries.

All of the additional money goes directly to drivers and delivery people.

On May 19, the company said it would extend the gas surcharge to June 15 for deliveries and until further notice for rides.

Uber also says it is working to encourage the use of electric vehicles, with incentives planned for drivers who make the switch.

“It’s important to say this surcharge is temporary and designed to try and keep earnings high during this difficult moment,” the company said in a statement at the time of the announced changes.

“We plan to listen to your feedback and will continue to review gas prices to determine if we need to make additional changes. Drivers and delivery people will be notified if the Temporary Fuel Surcharge is adjusted in the future.”

Lyft added a 55-cent fuel surcharge to each ride, which also goes to drivers.

Electric vehicle drivers receive the same surcharge. Lyft says it will remain in effect until further notice.



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