Chart of the Day: Check out a dramatic decline in daily number of taxi trips in Singapore

It's in contraction mode for 19 straight months already.

The average daily number of taxi trips made by one-shift taxis marked its 19th consecutive month of decline last August, data from the Land Transport Authority show.

While the downtrend is blamed on the rapid expansion of the private hire car service providers, mainly Grab and Uber, OCBC Investment research believes that the strong momentum is unsustainable over the long-run. Traditional taxi model, it said, is still a better full-time job option.

Bloomberg recently reported that Uber’s 1H16 loss of US$1.2b globally was mainly contributed by subsidies for Uber’s drivers.Furthermore, Singapore taxi operator ComfortDelGro’s (CDG) management noted in its 1H16 earnings call that 80% of its taxi hirers’ trips are still street hail, with the remaining 20% done through bookings.

OCBC Investment Research believes that this indicates that driving a traditional taxi full-time generates more stable and higher monthly income compared to driving for Uber/Grab (with lower or without incentives.

The research firm believes that an exodus of CDG’s existing taxi hirers is an unlikely scenario, and expects CDG’s taxi earnings to remain resilient as long as management continues to focus on ensuring high (>90%) hired-out rate of its taxi fleet.