Kakao Mobility (Kakao) won approval for a pilot exemption to operate metropolitan-area large and premium taxis as if they were in a single zone but has been unable to start the service for months. Individual taxi operators in Gyeonggi province are pushing back, saying their income will fall if "Seoul taxis take Gyeonggi calls."
By contrast, Kakao T Venti and Black drivers, comparing the situation to Tada, which has already begun a similar pilot, argue that "it is not fair that only Kakao T is blocked."
◇Kakao T Venti and Black stalled despite exemption approval
According to the taxi industry on the 28th, Kakao Mobility held talks at the end of March with the Gyeonggi Individual Taxi Association, the Gyeonggi Provincial Government, and the Ministry of Land, Infrastructure and Transport for a pilot to "integrate the operating zones of large and premium taxis across the metropolitan area." But the two sides only confirmed their differences and failed to reach an agreement. After that, the Gyeonggi Individual Taxi Association did not attend further talks, effectively halting discussions on launching the pilot.
The Ministry of Land, Infrastructure and Transport (MOLIT) approved the pilot exemption applied for by Kakao Mobility in Dec. last year. However, it attached a condition that the company must agree on detailed operating plans with local governments before starting the service. As a result, although the exemption was granted, it is difficult to actually begin service without the consent of local governments and the taxi industry.
The core of this pilot is to integrate and operate large and premium taxis subscribed to Kakao T Venti and Black across the metropolitan unit of Seoul, Gyeonggi, and Incheon. Currently, operations such as a Seoul taxi taking a passenger to Gyeonggi and then accepting a call for Incheon are restricted. If the exemption applies, taxis can accept calls and operate anywhere within the metropolitan area without regional distinctions.
Kakao Mobility was to run the pilot for two years from the service start date, after which the Ministry of Land, Infrastructure and Transport (MOLIT) would decide whether to adopt it formally following a performance evaluation.
◇Gyeonggi individual taxis: "If Seoul taxis flow in, income will drop"
However, individual taxi operators in Gyeonggi province oppose the move, citing concerns about reduced income. According to the Korea National Federation of Individual Taxi Associations, as of the end of March, the number of taxi licenses in Gyeonggi province stood at 38,039, about half of Seoul's 71,613. The Gyeonggi individual taxi industry believes that once integrated metropolitan operations begin, Seoul taxis will enter the Gyeonggi call market, inevitably reducing local drivers' income.
The Gyeonggi Individual Taxi Association argues that this pilot also runs counter to the purpose of the "taxi cap system." The taxi cap system manages taxi supply by region within a set scale. It was introduced in 2005 on the grounds that oversupply of taxis reduces drivers' income and can lead to long working hours or speeding.
Gyeonggi province, under the Ministry of Land, Infrastructure and Transport (MOLIT)'s "5th Taxi Cap Notice," has decided to reduce the number of taxis in the region by a total of 2,886 by 2029. The Gyeonggi Individual Taxi Association argues that in this situation, an inflow of taxis from other metropolitan areas would nullify the effect of the cap.
◇Tada is allowed but Kakao is not… the issue is platform influence
On the other hand, Kakao T large and premium taxi drivers raise fairness concerns. Tada received a pilot exemption in Sept. last year and began integrated metropolitan operations. A driver surnamed A who operates Kakao T Venti in Seoul said, "Taxis on the Tada platform run back and forth across the metropolitan area, but there is a sense that it's unfair that only Kakao T still can't start," adding, "If we can operate without metropolitan restrictions, it will help revenue."
Individual taxi drivers in Gyeonggi counter that Kakao Mobility and Tada cannot be simply compared. They say Kakao Mobility's share of the taxi-hailing market is so large that the impact would be different if the pilot begins. A Gyeonggi Individual Taxi Association official said, "Since Kakao Mobility's share of the hailing market exceeds 90%, it will inevitably feel different from the Tada case," adding, "Other platforms could also jump into the business one after another, so our opposition remains unchanged."
According to the taxi industry, Kakao Mobility is said to have reached a conditional understanding with the corporate taxi sector in Gyeonggi. There reportedly is no major backlash in Seoul and Incheon. In the end, whether the Gyeonggi Individual Taxi Association can be persuaded is expected to be the key to launching the pilot.
An official at the Gyeonggi Provincial Government said, "Because individual taxi drivers still strongly oppose it, it may take more time to start the pilot." Kakao Mobility said, "We have completed preparations for service operations under the integrated operating-zone pilot exemption," adding, "We are continuing discussions with relevant agencies and the industry."