Rising fuel prices have compelled taxi companies in Finland to raise their rates. Finland's largest taxi firm Taksi Helsinki has said that from Thursday onwards, it will increase its starting fee by one euro and fare based on travel time by ten cents per minute.
Taxi dispatch centre Lähitaksi has also announced plans to increase fares by an estimated 5 percent in mid April.
Fuel prices in the country have risen steadily over the past few months, with the average price per litre of diesel increasing from 1.78 euros in January to 1.87 euros in February this year, according to Statistics Finland.
It was 1.44 euros in February 2021, and 1.06 euros in February 2010. At its peak, the average price of diesel soared to over 2.3 euros per litre this March.
"There would be pressure to raise rates even more, but consumer prices cannot directly reflect the rise in fuel prices, or else there would be no customers at all," Pasi Rokosa, CEO of Lähitaksi, explains.
The Finnish Social Insurance Institution Kela is currently assessing whether it can increase reimbursement for taxi trips for people entitled to free taxis to healthcare appointments as the high fuel prices have rapidly raised costs for transport providers.
Electric vehicles a potential solution
Taxi operators in Finland are looking at adding more electric vehicles to their fleet to offset the impacts of surging fuel prices.
According to Teemu Rompannen, CEO of taxi firm Kovanen, using an electric car instead of a diesel car could cut costs by half in terms of energy consumption. The company began operating its first electric taxi on Wednesday and plans to incorporate more in August.
"Interest in electric cars has increased significantly, and we are working towards electrifying our fleet as soon as possible. We do not believe that rising energy prices will be reflected as strongly in the prices of electricity as that of diesel," Rompannen states.
Automotive suppliers are currently unable to keep up with the demand for electric vehicles from taxi operators.
"Last summer, there were 43 electric taxis in Finland. Now, we alone have almost double the number of electric taxis. The number would be higher if we could get the cars faster," Kalle Tarpila, interim CEO at Taksi Helsinki, says.
According to Tarpila, electric vehicles also help taxi companies reduce maintenance costs, as they eliminate services such as changing oil and cleaning exhaust pipes.
Lähitaksi says that since last autumn, low emission vehicles have been given top priority and are placed at the top of the list when customers order a taxi from the company via digital platforms.
"At the moment, about 15 percent of our fleet is low emission. We expect hybrid or electric cars to account for around half by the end of the year," Rokosa adds.
EDIT 18.3.2022 This story originally stated that Kela was investigating whether it could change reimbursement for commuters. It is actually considering that for those entitled to free taxis to healthcare appointments.