New Law on Taxis Takes Effect Skip to content
Taxi in Iceland's capital, Reykjavík
Photo: Photo: Golli. Taxis in Reykjavík.

New Law on Taxis Takes Effect

The much-protested law on taxis came into effect this April 1, leaving many taxi drivers uneasy about their future as a new company enters the market.

Among other reforms, the law loosens requirements for operating a taxi and removes restrictions on the number of taxi permits. According to lawmakers, the intent is to free the taxi market and to bring it up to date. The bill was opposed by interest groups, such as the Federation of Icelandic Taxi Drivers, who say it will both drive down their wages and lead to a decline in service quality.

Read more: Taxi Drivers Stage Protest in Reykjavík

The bill, however, was not opposed by all. Hopp, a popular electronic scooter rental company, is now making moves into the taxi market.

Reykjavík residents will soon be able to order a taxi through the Hopp app, 15% cheaper compared with traditional taxi services in Iceland. The law now also allows taxi drivers to operate within multiple companies, meaning that drivers in Iceland’s established taxi fleet may now choose to also work part-time gigs at Hopp as well.

Eyþór Máni Steinarsson, CEO of Hopp, stated to Morgunblaðið: “Times change and so should transportation. We can drive down prices in the taxi market, and we aim to be 15% cheaper than our competition. There is, of course, a vocal minority who are concerned about these changes. We only accept taxi drivers who are legal and registered. But of course, we would like to see extensions there as well. The barriers in becoming a registered taxi driver don’t quite match the spirit of the times.”

Eyþór Máni continued: “This is the next step in the revolution against the private car. The best car is no car, but the next best is the one you share with others, and we want to make it easy for people to share cars, both the ones they drive themselves and the ones others drive. We also believe that many working taxi drivers would be willing to work for more than one station and will be happy to receive more fares and a more transparent way of assigning them.”

Read more: Taxi Drivers Demand Hearing with the Government

Some, however, are still concerned over the shakeups in the taxi market.

Daniel O. Einarsson, chairperson of the Federation of Icelandic Taxi Drivers, stated: “They begin by undercutting the competition to establish themselves in the market. But then they raise their prices. We’ve seen this strategy before, just like how Uber operates.”

With the new taxi bill now in effect, Hopp has opened applications for new drivers. Hopp has stated that they hope to launch their taxi service when they have enough drivers, hopefully this spring.

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