ComfortDelGro to raise taxi fares, add app fee as Iran war drives up fuel costs

SINGAPORE – ComfortDelGro, Singapore’s largest taxi operator, said on March 17 that it will temporarily raise its metered fares and introduce a fee on app bookings to help drivers manage higher operating costs, as the war in the Middle East continues to put upward pressure on fuel prices.

The company said that the higher charges will be in place from March 24 to May 31.

During the period, customers will see a one-cent increase in metered fares for distances and waiting times. The rate, which is charged at various points of a trip, currently ranges from 26 cents for regular and larger taxis to 36 cents for limousine cabs.

A driver fee will also be introduced for bookings on its Zig app. This will be set at 50 cents for fares below $15, and 80 cents for fares of $15 and above.

With the hike, a metered ride of 17km on a typical four-seater taxi from Jurong East MRT station to the ION Orchard shopping mall booked on the Zig app will cost $19.10.

This assumes that the trip takes place during off-peak hours and does not incur waiting or ERP charges. The same trip currently costs around $17.90.

ComfortDelGro’s head of Singapore point-to-point mobility business, Mr Michael Huang, said: “All of these fees will go directly to drivers.

“We will continue to monitor the situation closely and remain committed to ensuring operational stability for our partners during this volatile period.”

Taxi driver Ong Chin Chye told The Straits Times: “Any additional income is helpful for drivers during this period.”

However, the 65-year-old is concerned that the higher fares may discourage customers from choosing taxis, particularly for shorter trips or when there are alternative transport options available.

“If demand drops, it could offset the intended benefits for drivers,” he said.

Earlier in March, ComfortDelGro, which manages more than 8,400 taxis and a smaller group of private-hire vehicles (PHV), started absorbing part of the increase in fuel costs at in-house pumps.

It was offering petrol at $1.93 per litre on March 5, and raised this to $2.31 per litre on the morning of March 11.

The firm said its fuel rates, which were significantly lower than the posted prices at petrol stations, would benefit its taxi and private-hire drivers.

ComfortDelGro has also launched an incentive programme, which is running from March 16 to April 12.

Drivers who complete at least 60 bookings each week on the Zig app are awarded up to $25 in fuel credit, to be used at in-house pumps. Those who drive electric vehicles will receive the incentive in cash.

Ms Teo Siew Pan, executive secretary at the National Taxi Association (NTA), said the temporary increase in fees and absorption of fuel costs by ComfortDelGro “will give drivers more direct support with each trip they make”.

“We hope this helps them sustain their livelihoods through this period,” she said.

Mr Raven Lee, executive secretary of the National Private Hire Vehicles Association (NPHVA), said: “Operating costs for PHV drivers have been rising and the fuel price increases due to the ongoing international conflict have added to that pressure.

“The driver fee for app bookings, with all proceeds going directly to drivers, helps offset these costs in a tangible way.”

Both Ms Teo and Mr Lee pointed drivers who need more support to financial assistance schemes available at NTA, NPHVA and NTUC, which both associations are affiliated with.

Posted prices of fuels at major petrol stations have risen by around 20 per cent since the US and Israel first attacked Iran on Feb 28.

The prices, which do not factor in discounts, may differ from what drivers actually pay at the pump.

Transportation of crude oil through a waterway critical to the world’s supply of the commodity has effectively halted with the war.

Singapore imports all the crude oil it needs, mostly from suppliers in the Middle East, and the imports are refined into petrol and diesel.

Zig user Nicolette Ten said that she will likely continue to use the app, but she will compare fares with those on platforms like Grab and Tada before booking.

“One reason I use Zig quite often is that metered taxis can sometimes work out (to be) cheaper, especially during certain peak periods,” the 32-year-old public relations consultant said.

Another Zig user, who wanted to be known only as Ms Choy, said she will choose whichever service happens to be cheaper.

“While I understand and feel bad for the drivers affected by the price hike, I will still choose a cheaper alternative,” said the 27-year-old media executive, who takes taxis about twice a month.

Ride-hailing platform Grab, which has stepped in to support its driver and delivery partners, did not respond to an ST request for comment on whether it has raised its fares.

Car-sharing platform GetGo will raise its mileage rates for its fuel-powered vehicles on March 18 at 11.59pm.

In an e-mail sent to users, the firm said the higher mileage rates will apply to standard and luxury vehicles, including existing bookings.

It added that customers embarking on a four-hour rental of a non-luxury vehicle, with a typical mileage of 42km, will soon pay over $2 more in total fees.

In March 2022, ComfortDelGro made its first fare increase in a decade by raising the flag-down fare by 20 cents. Distance- and time-based charges also rose.

At that time, it said the adjustment, which was almost identical to the one it made in 2011, would “help cabbies defray higher operating costs resulting from rising fuel prices and inflation”.

The company announced a temporary increase to distance fares less than a month later in response to the sharp increase in fuel prices after Russia’s invasion of Ukraine.

In December 2023, it once again raised flag-down fares for its regular taxis, as well as distance- and time-based charges.

This was meant to help drivers defray higher operating costs because of rising fuel prices, high inflation, and a goods and services tax hike from 8 per cent to 9 per cent.