Demise of GTA taxi company a potential warning sign for rest of the industry

After more than five decades a GTA taxi company is closing its doors and at least one industry association is warning that others are facing similar concerns.

Scott Wallace’s father started Burlington Taxi over 52 years ago and at its height, it employed upwards of 280 people. Wallace describes the demise of the business as a “death by a thousand cuts.”

“It’s certainly something we didn’t want and didn’t want to end this way,” he says, adding the final nail in the coffin wasn’t what you would expect.

At the height of the COVID-19 pandemic, the business shrank to just six vehicles on the road. But thanks to government assistance, the company managed to weather the storm – only to find that ramping up the operation would become a problem.

“We just had a lack of drivers out there. We can’t get enough people to work, not enough to carry the overhead and keep the operation running, it doesn’t make sense anymore,” says Wallace.

“We do a lot of contract work taking kids to school, different government contracts, different corporate contracts to keep us very busy and the last three months we’ve been turning them down every single day because we’re just unable to meet the demand. We tried calling people that were laid off back but they don’t want to come back either because of COVID or they found other work.”

Wallace points out there is also the issue of dramatically increasing insurance rates.

“Some people are paying upwards of $18,000 per car per year. That’s up from $5,000 just a few years ago.”

Pard Myke, who has been with the company for more than 25 years, tells CityNews he’s going to miss his regulars.

“You get used to seeing them and now it’s sad because they’re stopping me asking if we’re really shutting down and how their loved ones will get to work? I just tell them that I don’t know. It’s sad.”

Burlington Taxi’s demise is also a warning, says Behrouz Khamseh with the industry association Taxi Owners and Operators.

“I’m surprised that it happened but also not surprised because it was always going to happen,” says Khamseh.

While labour shortages are less of an issue in Toronto, the insurance cost is not and that, coupled with market share lost to companies like Uber and Lyft, are taking a heavy toll.

“You can not continue to pay $17,000 to $20,000 to insure a taxi when you don’t have the business. I think the politicians, they knew this was going to happen and they didn’t care,” he says.

Khamseh says to save the industry now, the regulations would need to be overhauled and drivers compensated. He adds a lot of drivers invested heavily to get into the industry that, until a short time ago, was much more lucrative.

“They borrowed money, they mortgaged their house. This is where we are now. It’s a sad story.”

Wallace says he is grateful to his staff and clients over the years but worries about those left without other options to get around.

“Kids that need special attention, we took them to school for years – it was a big deal for us. And then there’s the seniors.”