After a bumpy road, renewed demand drives growth
Melbourne, Australia (PRWEB) May 07, 2013
The Australian Taxi and Limousine Transport industry is heavily regulated, with state governments determining the number of taxis on the road, fares they can charge and structure of the industry. Hire cars, limousines and wedding cars are moderately regulated, with state governments determining the number of these vehicles on the road and operating conditions. Over the five years through 2012-13, revenue is estimated to have grown at an annualised 1.7%. In 2012-13, revenue is expected to grow by 0.3% over the year to reach $4.91 billion.
According to IBISWorld industry analyst Ricky Willianto, “flush consumers and businesspeople supported industry revenue growth in the years leading up to the global financial crisis. Corporate spending grew steadily, with business travellers preferring the convenience of taxis and silver service or luxury sedan transport to airport transit and buses.” Continued strong growth in real disposable income encouraged increased spending on cafes, restaurants, pubs, clubs and recreation activities, helping to boost demand for taxis and other road passenger transport, and push revenue higher. This disposable income growth also helped the wedding and special occasion market grow.
Poor global economic conditions in 2008-09 caused Australian business confidence to plummet, taking budgets for business travel with it. “A shift to remote communication technologies such as videoconferencing accelerated, substituting in-person communication”, says WIllianto. “The same poor economic conditions resulted in decreased demand from households as they cut back on spending and outings.” Tourism fell sharply in 2008-09, driving industry demand even lower. Revenue fell 0.8% as a result. However, industry revenue picked up through 2009-10 and 2010-11, as business travellers returned and consumer demand stabilised. In 2012-13, industry revenue is expected to grow 0.3%. As government-determined supply lags well behind demand, population growth and demographic changes will see revenue increase strongly in the next five years.
One major player, Cabcharge, dominates the Australian Taxi and Limousine Transport industry. Revenue does not capture the full influence of various players in the industry. In the industry hierarchy, depot owners, license owners and license operators stand between the customer and the taxi driver. Concentration at these intermediate levels of the industry can have significant effects on competition within the industry without being significant from a revenue point of view.
For more information, visit IBISWorld’s Taxi and Limousine Transport report in Australia industry page.
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IBISWorld industry Report Key Topics
Companies in this industry operate taxicabs, hire cars with drivers or other forms of road vehicles for passenger transportation, such as limousines and wedding cars.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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