Taxi drivers feeling pinch of high fuel costs

While the adverse physical impacts of sky-rocketing prices of oil products remain within the boundaries of airline tickets and gas service stations, the people who get their living from the road have started feeling the painful pinch of high oil costs.

The series of oil price adjustments since last year forced taxi operators in the Northern Marianas to allocate additional money to fill their tanks up from their meager income which average $30 per day.

Boboy’s Taxi owner Plas M. Tagabuel said operational costs have jacked up which translate to lower income since daily earnings would have to subsidize the additional expenditures borne by higher gasoline prices.

Mr. Tagabuel pointed out that the adverse impacts of the additional expense could have been worse to operators who have only one taxi unit, and from which their livelihood heavily depends on.

“The increase in oil prices put more pressure on our income which has not changed and remained very low,” said Tagabuel, who operates 17 taxi units on Saipan.

Regular unleaded fuel is now being sold at $2.099 per gallon at both Mobil and Shell gasoline stations while pump price of premium unleaded is $2.189 per gallon, following a six-cent increase which took effect last week.

Last week’s oil price adjustment by Mobil and Shell is the third in less than two months and the eighth since April last year.

John Muna, who deploys his two units at the Pacific Island Resort, said higher fuel prices have aggravated the problems currently faced by drivers and operators due to the absence of enough passengers who take the taxi when they tour around the island.

On the average, taxi drivers get passengers twice each day on a good business day which translate to about $32 to $40. At least $10 of which goes to gasoline.

There are times, however, that taxi drivers would not get a single passenger in a day.
While drivers do not spend money for gas since they are mostly deployed in hotels and duty-free shops waiting for passengers, they burn gas when they take their units from the garage to their respective stations.

According to Mr. Muna, he would normally burn $42 worth of gasoline in a maximum of three days for one of his units. He said most of the passengers they get go to duty-free shops which give tourists free transportation service from their hotel to the establishment.

Under this set up, duty-free shops pay taxi drivers an average of $15.80 per trip from the hotel to the establishment. The drivers are issued ticket for every individual or group of tourists ferried to the shops which are redeemable into cash after a 15-day period.

Flag down rate
Drivers expect to earn more with their meters flagged down and when passengers pay them in cash but are forced to submit themselves into the set up with shopping centers since the number of tourists taking the taxi comes in trickles.

The commerce department’s taxicab bureau recently raised the flag down rate from $2.00 to $2.50 and the succeeding quarter mile charge from 50 cents to 75 cents.

Despite the additional costs they shoulder due to the swelling prices of petroleum products, taxi drivers are not keen on asking the CNMI government to increase flag down rate.

“Adjusting the flag down rate and the charges for the succeeding quarter miles would hurt us more because we might lose passengers in favor of buses,” Messrs. Tagabuel and Muna told an interview.

Taxi drivers have previously expressed disappointment over the entry of big transportation companies into the CNMI that deploy trolley and tour buses which, they claim, have cornered the bulk of passengers on the island.

Trolleys and buses offer cheaper fare rates and drop passengers at any point at a fixed rate.

External market forces have driven international market prices up since January, particularly in the Singapore regional market, forcing the oil company to adjust mark-up prices of regular and premium fuel.

Due to the continued adherence of the Organization of Petroleum Exporting Countries to reduced production quotas and higher regional demand, oil company officials see a trend of increase in world prices of petroleum products.

Business analysts said the increase in fuel prices would eventually push prices of commodities up, due to the corresponding increase in transportation costs.

The last time CNMI witnessed a reduction in oil prices was in December 1998, when fuel prices in the local retail market dropped at an average of 0.02 to 0.04 cents per gallon.

Economic upheavals which have fanned beyond the Asia-Pacific Rim triggered a lower demand and sales to airline companies, hotels, construction sector, power plants and other commercial and industrial establishments.