Taxi fares high despite cheaper fuel - Social Issues

Updated

June, 21 2012 10:53:34

Taxi fares high despite cheaper fuel

Taxis pick up passengers in HCM City. Transport fees remain high despite a drop in both petrol and oil prices. — VNA/VNS Photo Thanh Phan

HCM CITY — Petrol and oil prices have dropped three times within a month by a total of VND1,900 and VND1,400 per litre respectively, but transportation fees have not changed and some service providers have even talked of increasing prices.

In early March, transportation fees were increased by between 10-20 per cent due to the sharp increase in petrol prices, which meant prices of all essential commodities went up as well.

"High transportation fees, especially for international shipping, makes things difficult for us," said Duong Ngoc Minh, general director of the Hung Vuong Seafood JSC.

Each month Minh's company exports products worth US$22 million but he has to pay $1.6 million in international and domestic transportation fees.

He has already requested transport and shipping companies to reduce their fees, but the response has been that they would increase further by 10 per cent next month.

The main argument made by transportation firms for not reducing their fees is that petrol prices are not the only deciding factor.

According to taxi companies, petrol accounts for 30 per cent of their expenditure, while companies engaged in transporting commodities say oil accounts for 45 per cent of their expenses.

"Fees can't be reduced because everything else has already gone up," Dang Duc Tiep, director of the Dang Tien Limited Company, was quoted as saying in the Nguoi Lao Dong (The Labourer) newspaper.

"Petrol and oil prices make up to 45 per cent of our expenditure and they have only dropped marginally, so it's not enough for us to reduce price," said Luong Hoang Trung, deputy chairman of the HCM City Commodity Transport Association.

Another reason mentioned by firms keeping transportation fees intact is inflation.

Only taxi firm Vinasun has so far reduced prices by VND500 per km.

The Finance Ministry has sent a letter asking all Finance Departments to review the situation and suggest remedial actions. — VNS

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