Cab earnings update: seasonal rise in demand for taxis offsets increased fuel and gate costs.


Cab earnings with trendline as of 4/24/08

San Francisco cab drivers face two recent cost pressures: a recent gate fee increase combined with the recent climb in gas prices.

Fortunately, these cost pressures come at a time when aggregate demand for taxis in the City is increasing. More tourists, outdoor City festivals, and frequent conventions bring in more and more cab passengers as the summer approaches.

However, I paint a bleak picture for this winter. As seasonal demand for taxis wanes in November, this winter could be the toughest yet for City cab drivers and companies. Qualified, skilled cab drivers will seek new income opportunities as average take-home pay dips to new lows this winter. Cab companies will likely have a more difficult time than ever filling shifts, putting pressure on hiring managers to accept drivers with less stringent requirements for clean driving records, English proficiency or general City knowledge.

Given this bleak outlook, I think my…

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