Taxi Fares in Israel Dramatically Higher Than Europe Due to Lack of Competition
A recent trip to Batumi, Georgia, highlighted stark price differences between Georgian and Israeli public transportation, particularly taxis. The author found that a typical taxi ride in Batumi costs around 10 Georgian Lari, equivalent to approximately 11.5 Israeli shekels, which is a quarter of the price for a similar ride in Tel Aviv. This significant disparity, the author argues, is not solely due to lower gasoline prices in Georgia (around 4 shekels per liter compared to 8.25 shekels in Israel), but primarily stems from a lack of competition in Israel's taxi market.
In Batumi, the ride-sharing app BOLT operates, offering efficient, courteous, and affordable taxi services. BOLT provides various service levels, with the basic option costing no more than 5 Lari (about 6 shekels) per ride, half the price of a regular taxi in Batumi. Even a longer trip from Batumi's city center to the airport, costing around 15 shekels, is significantly cheaper than a falafel meal. In contrast, a similar distance journey from Ramat Gan to Ben Gurion Airport in Israel cost the author 150 shekels, ten times the price in Batumi.
The author contends that Israel's taxi market suffers from a lack of alternatives for consumers, leaving them captive to high prices. While introducing foreign companies like BOLT and Uber could impact Israeli taxi drivers who have invested heavily in their licenses, the author questions who will compensate passengers for the inflated costs. BOLT's attempt to enter the Israeli market in late 2022 was unsuccessful, and the author suggests that current Transportation Minister Miri Regev is hindering the process, despite a promise made a year prior to explore Uber's entry and open the market to competition.
Without regulatory changes, the author believes the situation will persist, with consumers continuing to overpay. The article contrasts this with former Transportation Minister Yisrael Katz's "Open Skies" reform, which successfully lowered airfare prices. The author concludes that a change in leadership and regulation is needed to foster competition and reduce the high cost of living in Israel, suggesting that a more affordable taxi experience, similar to that in Europe, is achievable.
