Print this page   Print this page

Competition gone mad

Change low graphic options | Change language | Skip content to navigation

Page context: Home > Transport International Magazine > Issue 20 July 2005 > Competition gone mad


Japanese taxi drivers have lodged a lawsuit against the government over what they see as unfair competition and the dumping of fares. Masako Asaeda reports

Taxi driving in Japan once provided a decent, if not lavish, living. Today, against a background of continuing economic recession and deregulation, drivers are suffering harsh competition over a smaller pool of clientele, with an increasing number of taxis. This means less pay and longer hours to make ends meet.

An already worrying situation was aggravated when the land, infrastructure and transportation ministry issued the so-called “9.16 notice” (reflecting the date of 16 September). This came into effect in October 2004, promoting further unfair competition and a dumping of taxi fares.

How can anyone make a living like this?

Drivers’ testimonies at a court hearing over the lawsuit in March 2005 more >>


Since December 1996, the ministry has been allowing more companies to start afresh in the industry, and has also been approving lower fares. The 9.16 notice was issued in line with this trend. It allows major corporate customers, who have contracts with taxi companies and pay taxi fares in vouchers, to secure discounts of up to 30 per cent on fares. These voucher-paid taxi fares make up around 30 to 34 per cent of the drivers’ fare revenue, and mean they will receive much less income than before.

The ITF-affiliated taxi drivers’ union Zenjiko, is now supporting a lawsuit by 24 people representing taxi drivers and taxi users. The plaintiffs are asking the government for symbolic compensation of 500,000 Japanese yen (approximately US$4,700) per person, arguing that the notice is illegal since it promotes unfair competition and the dumping of taxi fares.

Main arguments of the lawsuit

  • The notice issued by the ministry is illegal because it is against existing laws to protect fair competition and prevent dumping of taxi fares
  • Further discount of fares will threaten taxi drivers’ livelihoods, as they will not be able to earn enough money to support themselves
  • Fare discounts will benefit only major corporate customers who pay with vouchers
  • Passengers will also be deprived of their right to a safe, convenient and comfortable means of public transport

This change forces drivers to work longer hours and risk their own and their passengers’ safety by driving faster so they can take more passengers. Taxis are already involved in more accidents than other vehicles.

According to police statistics, in 2003 taxi accidents increased by over five per cent compared to 2002. This rate is almost five times more than the increase of all road accidents. And while fatal accidents on the roads decreased overall by almost seven per cent, the number of fatal taxi accidents increased by a shocking 25.5 per cent.

Plaintiffs argue that the 30 per cent discount voucher system is also unfair on passengers – allowing some to pay less than others. Those losing out are the ordinary passengers, who stop a cab in the streets or call the sales office for a ride. Extreme deregulation and cost reduction are benefiting only corporate users, while threatening the taxi industry’s role to provide fair and safe public transport.

Targeting drivers’ wages

Many unions had to accept changes to their wage systems in the 1990s when cost-cutting measures began to target wages, a main source of expenditure. The existing fixed wages plus allowance system made way for a wage system mainly or totally related to fare revenue (with no tips). If the unions had not accepted this change, many drivers would have lost their jobs.

Now however, drastic fare discounts have led to a situation where drivers cannot earn enough wages for a living, even though they are working harder and longer than before. Today, in many parts of Japan, the average taxi drivers’ monthly income is below the minimum rate to qualify for low income benefits.

Meanwhile, increased numbers of taxis cause traffic jams, arguments flare between taxi drivers who scrabble about for customers, and unnecessary disputes arise over taxi fares between drivers and passengers. Plaintiffs are demanding the government stop such degradation of the taxi service, for the sake of both taxi drivers and passengers.

Shigeru Wada, ITF Asia Pacific regional secretary, who joined the lawsuit as one of the taxi users, comments: “It is a good initiative of Zenjiko’s to begin the suit. The Japanese government must realise that there are human beings, and not robots sitting behind these wheels. It is unacceptable for such fare discounts to be made for major corporate customers, to the detriment of the workers’ lives.”

Masako Asaeda is a regional assistant for the ITF Asia Pacific office, and is based in Tokyo.



Section home:
Issue 20 July 2005

Other pages for Issue 20 July 2005:
Comment: Fighting Back and Winning | ITF launches new global website | Value for money | Protecting our waterfront | The fight for true democracy | Enter the hit squads | This is why we joined a union | Transport goes transnational | From wellhead to wheel | Putting the seafarer first | Driving change in Kurdistan | End this railway nightmare | We can help to defeat poverty | Readers’ thoughts on poverty | Working life

Other pages for Competition gone mad:
How can anyone make a living like this?

ITF Home | Transport International Magazine | Current issue | Previous issues | About Transport International | Distribution | Request copies | Editorial staff


Full graphics version

accessibility | site help | site map

The journal of the International Transport Workers' Federation

© ITF 2004 All rights reserved

ITF House, 49-60 Borough Road, London SE1 1DR | +44 20 7403 2733 | mail@itf.org.uk

Copyright © 2012 International Transport Workers' Federation