A HEARING will be held Friday to merge the operation of green and red cabs, raise fares and adopt a flexible pricing mechanism for traditional cab service, according to a report in the Southern Metropolis Daily.

    According to drafts for discussion, the city will increase the waiting charge of cabs from the present 0.8 yuan (US$0.11) per minute to 1.2 yuan per minute, raise the flag-fall price from 10 yuan for the first 2 kilometers to 13 yuan for 3 kilometers, or raise the mileage price to 2.6 yuan per kilometer from the present 2.4 yuan, while leaving the flag-fall price unchanged at 10 yuan for the first 2 kilometers.

    The three plans will adopt a cascade fare system for empty return fees, which charges an additional 30 percent for a distance of 25 to 50 kilometers and an additional 60 percent for a distance of more than 50 kilometers.

    The hearing is aimed at promoting the healthy development of the city’s cab industry, but an online survey conducted by the newspaper showed that residents weren’t optimistic about the merge and price hike, and some said that they would reduce their cab usage after the price hike.

    Though the plans could help increase the profit of a single ride, some drivers fear their income won’t rise if the number of rides decreases.

    “Many residents choose cabs for short trips under the present fare system in which cab fares are not much higher than those of app-based cabs. If the prices are hiked, more short-trip riders will use app-based cabs, and traditional cabs will be put in a difficult situation,” said one cab driver who opposed the plan.

    Statistics from the city’s development and reform commission show that the monthly operating cost of a red cab in 2015 was 30,701 yuan and gross income was 36,942 on average, meaning average net profit was 6,241 yuan a month. However, between January and September this year, average net monthly profit dropped to 3,892 yuan, while operating costs also dropped slightly.

    The situation for green cabs is worse. Statistics show that the monthly operating cost of green cabs in first nine months of this year was 28,457 yuan, while the average monthly income was 22,659 yuan. (Richard Han)