Taxi and Limousine Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 6,800 taxi and limousine services in the US generate revenue by charging fares for transporting passengers between locations or leasing vehicles and medallions/licenses to drivers. Legal taxi and limo companies typically require a license or “medallion” to operate within a city. The cost to acquire a medallion can be high because regulatory organizations limit the number of medallions. Local codes may also regulate fares, vehicle safety, language fluency, and driver competence. Many drivers work as independent contractors and are licensed through or rent vehicles from taxi or limousine companies.
Risk Of Crime
Taxi and limousine service providers may pick up passengers in unsafe neighborhoods, putting drivers and vehicles at risk for crime.
Highly Regulated And Limited
In major cities, the taxi and limousine services industry is highly regulated by municipal commissions and boards.
Industry size & Structure
The average taxi or limousine service works out of a single location, employs fewer than 10 workers, and generates about $3.8 million annually.
- The taxi and limousine service industry consists of about 6,800 firms that employ about 59,000 workers and generate about $26 billion annually.
- The industry is somewhat concentrated; the top 50 companies account for about 67% of industry revenue.
- The majority of firms operate within a limited geographical market. Large companies include Carey Holdings, Empire CLS Worldwide Chauffeured Services, and Yellow Cab (Chicago).
Industry Forecast
Taxi and Limousine Services Industry Growth
Recent Developments
Jul 15, 2024 - Employment Increases, Wages Decrease
- Taxi and limousine service industry employment increased slightly during the first five months of 2024 while average wages for nonsupervisory employees decreased moderately, according to the US Bureau of Labor Statistics. Taxi and limousine service industry sales are forecast to grow at a 6.54% compounded annual rate from 2024 to 2028, faster than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc.
- Bankruptcy filings continue increasing toward pre-pandemic levels, according to Epiq Bankruptcy, and taxi and limousine services may be negatively impacted as a result. New filings increased year over year across all US major filing categories during the first quarter of 2024. Total commercial chapter 11 filings (including subchapter V) registered the largest increase, as the 1,894 filings during the first quarter of 2024 were up 43% from the 1,325 total commercial chapter 11s during the same period in 2023. Total overall commercial bankruptcies increased 22% in the first quarter of 2024, as the 7,113 filings surpassed the 5,820 commercial filings during the first quarter of 2023. Subchapter V elections for small businesses increased 30% to 606 filings in Q1 2024 from the 465 filed during Q1 2023.
- Driverless "robotaxi" services have had mixed results in expanding their coverage area. California regulators authorized Waymo in early March to expand services of its fleet of robotaxis into Los Angeles and to cities on the peninsula south of San Francisco. The expansion for Waymo comes after California authorities revoked the license of Cruise, a rival robotaxi service owned by General Motors, after determining that its driverless cars that had been transporting passengers throughout San Francisco were unsafe. A robotaxi run by Cruise ran over a pedestrian who had been hit by another vehicle driven by a human, and then pinned the pedestrian under one of its tires after coming to a stop.
- Workplace occupancy, an indicator of demand for taxi and limousine service, was 51.8% for the seven-day period ending on June 12, up from 51.6% for the seven-day period ending on June 5, according to data gathered from swipes of access control cards in buildings with security systems provided by Kastle Systems. Occupancy rarely hit the 50% mark from the early days of the coronavirus pandemic through early 2024 despite attempts by many organizations to bring employees back. The Austin, TX, metropolitan area had the highest occupancy for the seven-day period ending on June 12 at 63.9%. The San Jose, CA, metropolitan area trailed all others tracked at 37.6%.
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