This is one of the most familiar numbers these days in Hyderabad ... yes you guessed it rite - Radio Cabs, a concept that was non-existent in the city before the new international airport came up six months ago. The old airport was mainly served by autos, taxis and cabs. But the ultra modern airport has limited itself to radio cabs and call taxis as there was need to generate some revenue out of this business opportunity. GMR, the partner of the country's second PPP airport is now leaving no stone unturned to generate revenues - and the commission from radio cabs seems to be one of the options before the firm.
There are number of players who ventured into this business with a total of close to 2500 radio cabs between them and some of them are still waiting to enter the market. The government regulations exist even in this business ensuring that there is an entry barrier - read minimum of 100 cabs are required to enter the business and at the same time there is no monopoly - the number of cabs for any player is restricted to 1000. The sudden surge is largely helped by three factors - the distance of the airport from the city , lack of convenient commutation options and of course the increase in the disposable income . However, this wave has not been a smooth one - it has its own issues, major one being lack of supply of quality drivers. What it meant was another business opportunity to some of the driving schools and also the training schools to teach some etiquette to the drivers so that they present themselves well before the customers.
The radio cab companies are coming up with an lucrative salary and incentives to attract the limited pool of drivers. Now some of them have taken a step further and this is what has interested me and thats why the post - They have announced a scheme that any driver who drives a cab for a period of 7-10 years can own the car. This gives them various advantages - firstly the drivers can be retained, secondly the drivers will be careful after all it is their car in future and lastly it will become easy for the companies to dispose off the cars in future and may be they can gain some tax advantage utilizing the appropriate accounting mechanisms. Smart way to think - Isn't it?
There are number of players who ventured into this business with a total of close to 2500 radio cabs between them and some of them are still waiting to enter the market. The government regulations exist even in this business ensuring that there is an entry barrier - read minimum of 100 cabs are required to enter the business and at the same time there is no monopoly - the number of cabs for any player is restricted to 1000. The sudden surge is largely helped by three factors - the distance of the airport from the city , lack of convenient commutation options and of course the increase in the disposable income . However, this wave has not been a smooth one - it has its own issues, major one being lack of supply of quality drivers. What it meant was another business opportunity to some of the driving schools and also the training schools to teach some etiquette to the drivers so that they present themselves well before the customers.
The radio cab companies are coming up with an lucrative salary and incentives to attract the limited pool of drivers. Now some of them have taken a step further and this is what has interested me and thats why the post - They have announced a scheme that any driver who drives a cab for a period of 7-10 years can own the car. This gives them various advantages - firstly the drivers can be retained, secondly the drivers will be careful after all it is their car in future and lastly it will become easy for the companies to dispose off the cars in future and may be they can gain some tax advantage utilizing the appropriate accounting mechanisms. Smart way to think - Isn't it?
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