The typical minibus taxi is a 16-seater, typically white in colour with the most common model being the Toyota Quantum Sesfikile. Taxis operate an unscheduled service on fixed routes managed by taxi associations.
Taxis will typically depart from fixed terminals but stop anywhere along their route to pick up and drop off passengers. Passengers hail taxis using hand signals to indicate where they are travelling. Taxi ranks are hives of activity and market places establish themselves around the ranks to service the commuters.
Regional taxi councils determine the fares for each route considered to be affordable for the lower income population of the country. Fares are paid in cash and in some areas of the country the taxi owner employs a conductor to manage fares whilst in others, passengers themselves manage the cash by passing it to the driver.
SA Taxi Direct dealership was established in 2015, selling both new and pre-owned premium taxis. Due to strong relationships with Toyota, SA Taxi is allocated approximately 70 new Toyota Sesfikiles per month to sell alongside the pre-owned vehicles.
This channel offers SA Taxi greater returns on the entire vehicle deal and provides a profitable and reliable marketplace for sale of refurbished vehicles due to the following factors:
Taximart was established in 2009 to refurbish primarily repossessed minibus taxis in the secondary market and improve SA Taxi’s recoveries.
Taximart services include repair and maintenance which is completed timeously ensuring that owners’ vehicles are back on the road as soon as possible.
The ability to refurbish and resale has enabled SA Taxi to reduce their loss ratios as by recovering a significant percentage of the loan value of repossessed vehicles. This is achieved through reducing costs, improving turnaround times, improving product quality and providing higher returns than auction prices. Taximart has also led to reduced insurance cost of claims.
Efficiencies created through Taximart arise from the following:
In 2015 SA Taxi launched a point-to-point taxi offering which includes financial services. The taxi owner-drivers are also given access to the stand alone ancillary services such as insurance and maintenance as well as the Zebra Cabs’ own taxi platform.
The Zebra Cabs platform was developed to further support the taxi owner-drivers and their respective SMEs focusing on all owner-drivers financed through SA Taxi as well as those looking for an alternative taxi platform, provided they meet the standards set by Zebra Cabs in terms of the vehicle type and background checks.
The target market for point-to-point is similar to the minibus taxi market as the target customer is an existing or aspiring vehicle owner with limited access to traditional finance.
A key condition of SA Taxi’s loan agreement with the taxi operator is that the vehicle is required to have comprehensive short term insurance. SA Taxi has designed its own highly competitive comprehensive insurance products that it sells through SA Taxi Protect (Pty) Ltd, its own insurance cell captive entity established in partnership with Guardrisk Insurance Company. Policies are tailored to the needs and risks of the fixed route taxi industry and include niche specific cover such as business interruption cover and instalment protection when the vehicle is being repaired, credit short fall cover when the vehicle is a total loss and absconsion, policy violation cover in the event of client defaults.
The taxi owner can elect to take up the insurance product from SA Taxi Protect or alternatively insurance from a third party provider as long as the cover meets the minimum requirements. Approximately 81% of the SA Taxi asset portfolio (as at 31 March 2016) is insured through SA Taxi Protect with the balance insured by other reputable credit providers such as Hollard and Santam. In addition, SA Taxi sells insurance policies to non-financed clients. The product offering and price is attractive to all taxi owners as evidenced by the growth in this non-financed portfolio which has grown to approximately 4,200 insured vehicle since October 2013.
In addition, SA Taxi sells insurance policies to non-financed clients. The product offering and price is attractive to all taxi owners as evidenced by the growth in this non-financed portfolio which has grown to approximately 4,200 insured vehicle since October 2013.
SA Taxi Protect also offers stand-alone taxi owner protection cover sold on a voluntary basis at inception of the comprehensive motor policy with 10,400 policies currently in place.