Investors in the transportation sector have said that they are reluctant to invest in the taxi sector because of the current rules and regulations that stipulate that only Saudis work in the industry. Around 30 percent of taxi companies have pulled out of this sector in the past three years. They have incurred losses estimated at SR300 million.
Abdulhadi Al-Qahtani, former chairman of the Taxis Committee at the Jeddah Chamber of Commerce and Industry (JCCI), said authorities should be held accountable for hindering business.
Al-Qahtani described the situation in the taxi sector as chaotic and said many taxis violate rules and regulations by operating without number plates.
“I filed a report to authorities and distributed a circular to taxis in my company because both cars and their drivers have been missing for years and we still can’t find them. I have also issued a disclaimer with authorities so as not to be held accountable for these missing vehicles,” he said.
He pointed out that an earlier suggestion has been made to merge taxi companies and private taxis in one company that would be adopted by the JCCI following the decisions imposed by the Ministry of Transport on such companies. Major investors allocated SR500 million to establish a taxi company that would follow suit to major taxi companies in most countries.
“We were shocked by decisions that caused many investors to pull out from the sector,” he said. He questioned the transportation status in Saudi Arabia and asked authorities about the absence of a public transport station in Jeddah.
Many cars that transport goods between Saudi Arabia and other Gulf or Arab countries, as well as cars for domestic transport, park alongside the coastline in southern Jeddah because drivers can only find parking areas on the outskirts of the cities, as there are no public transport stations.
Saed Al-Bassami, current chairman of the Taxis Committee at the JCCI, said that fully nationalizing taxi services was one of the biggest obstacles that this sector faces. Many Saudi nationals who wish to work in the taxi business go to programs and funds allocated to financing taxis.
He said it is less problematic to own a taxi. He added that more than 90 percent of those who work in this sector are expatriates who are in violation of rules and regulations.
Companies often have no choice but to halt their operations or pull out of the market altogether, incurring large losses or illegally renting taxis to expatriates.
