No institution appreciates the value of a monopoly more than Macquarie Bank – pricing power is a wonderful thing. But MacBank might have underestimated just how hard it was going to be to take on one of Australia’s toughest monopolies, CabCharge. The result looks like being the escalation from a fight over disabled taxis to a war across the taxi spectrum.
The SMH reports Macquarie’s executive committee has approved a full assault on the taxi industry with a new cab fleet and payment voucher system as well as its fledgling Lime disabled taxi brand.
The taxi industry around the country is a dubious beast, strategically embedded in State politics, nowhere more so than in NSW.
There seems to be more than a hint in Lisa Murray’s story that the full attack on CabCharge could be fuelled by frustrations in getting the Lime fleet operating:
The new venture comes as Macquarie experiences further delays in getting its Lime service up and running. The service, for disabled passengers, was launched in February by a Macquarie executive, Bill Moss, who has muscular dystrophy.
It has faced criticism from Cabcharge’s boss, Reg Kermode, who says the taxi industry is “far removed from the rarefied atmosphere of merchant banking”. Cabcharge owns Australia’s biggest operator, Taxis Combined…
(Macquarie) said in February that it would have 240 cabs on the road by Christmas. There are none officially on the road and the 240-car target has been pushed back until at least next September. The company was forced to wait six months before its network was authorised by the Ministry of Transport in March.
It has since been fighting a requirement for it to join the centralised booking service for taxis with wheelchair access, which is run by Cabcharge.
Lime’s chief executive, Stephen Albin, said: “What started out as a realistic business proposition to raise the standards of service to the disabled community has uncovered an industry that’s so locked up to competition that you couldn’t reasonably expect to get a socially responsible initiative off the ground in itself.”
Macquarie is big and rich, but Kermode’s CabCharge is ruthless and well-connected. Macquarie has former NSW Premier Bob Carr on its payroll. CabCharge has former NSW Premier Neville Wran on its board. No prize for guessing which one would be best to have on side in a hard fight, especially when the Dilemma government wants to put plenty of distance between itself and the Carr legacy.