[Public Voices] Mobility Innovation and the Taxi Crisis

On June 22, the world's first fully unmanned autonomous taxi service, a robo-taxi without a front passenger assistant driver, began commercial operation in San Francisco, USA. On June 9, Hyundai Motor Group's robo-taxi, RoboRide, started a pilot service in the Gangnam and Seocho areas of Seoul.

Both services claim to operate at Level 4, which means perfect autonomous driving within a designated area, but in Korea, a driver is still on board as a precaution for emergencies. Meanwhile, Urban Air Mobility (UAM), which refers to air taxis and flying cars?small electric-powered aircraft capable of vertical takeoff and landing or using short runways?is expected to be commercialized in 2 to 3 years.

In this way, traditional transportation is transforming into mobility by adopting digital transformation technologies such as big data, the Internet of Things, and artificial intelligence. While transportation was movement determined by providers in terms of place, time, and method, mobility refers to movement based on the user's desired place, time, and method. Furthermore, mobility is evolving into Mobility as a Service (MasS), a service that integrates various transportation modes into one app to provide optimal travel options for users in a one-stop manner.

Although mobility innovation is progressing worldwide, Korea is currently experiencing a taxi crisis. After the easing of COVID-19 social distancing measures, taxi demand has surged, but the supply of taxis is absolutely insufficient.

The shortage is not due to an overall lack of taxis. In Seoul, there are 7.5 taxis per 1,000 people, which is sufficient compared to advanced countries. The problem lies in the shortage of supply during high-demand times such as late at night or during bad weather. Most taxi drivers are elderly, aged 64 and above, and they tend to avoid operating during late-night hours due to risks such as intoxicated passengers, which reduces expected earnings during those times.

Until now, the government and political circles have banned all innovative mobility services that could replace or supplement taxi demand, citing protection of the existing taxi industry. In 2013, Seoul city classified 'Uber' as an 'illegal call taxi' and halted its operations. In 2018, the National Assembly responded to 'Tada Basic,' a rental car service with drivers, by enacting the so-called 'Tada Ban Law' in March 2020. If such alternative or supplementary services had been allowed, the taxi crisis could have been avoided.

These regulations, which rejected innovation, not only blocked the emergence of new industries but also failed to improve the competitiveness of the existing taxi industry, causing harm only to users. Fortunately, the emergence of platform taxis has improved taxi boarding conditions. Even for short-distance calls, forced dispatch has increased customer satisfaction, and some premium brand taxis have contributed to both travel convenience and increased driver earnings.

Ultimately, the way to expand taxi supply under the current circumstances is to increase the influx of taxi drivers. To achieve this, it is necessary to raise drivers' expected earnings within the scope of user convenience and willingness to pay. Expanding a dynamic pricing system, which charges less than the standard fare during low-demand daytime hours and more during high-demand late-night hours, to regular mid-sized taxis could be an alternative.

It is time for the public and private sectors to pool their wisdom to lead mobility innovation such as MasS, autonomous vehicles, UAM, and electric vehicles, moving beyond the backward taxi crisis.

Seong-Yeop Lee, Professor at Korea University Graduate School of Technology Management and Director of the Technology Law Policy Center

This content was produced with the assistance of AI translation services.