Taxi Driver Online

Anyone who buys a plate at the moment is as daft as a brush.
That aside mine is avaible for £35000 +.
Any offers please.

If it was 20 years ago there may have been a good reason for investing in a cab and plate, however In todays climate anyone who buys a cab and plate is demonstrating the fact that they haven't thought it through.

What they are demonstrating is the fact they are willing to gamble tens of thousands of pounds on the local Authourity maintaing the status quo or that a legal challenge somewhere in the country will fail, should anyone decide to challange a local council when the governments guidance is issued. To take it a step further, they are gambling that competition legislation or indeed the 2007 Transport act from Europe will not impact on the taxi trade and finally they are gambling that this Govenment eventually won't remove restrictions

There are countless reasons why one should seriously think it through but demonstrating business acumen has never been a part of of it. The reward and costs are the same for every individual in the trade, unless you are capable of reducing those costs by servicing the vehicle yourself. That is the only reduction in costs you will achieve.

If anyone has a large amount of money to invest I would advice to them to invest it wisely, not gamble on something that in my opinion will be worthless in a very short time.

Best wishes

JD

No-one has yet suggested an alternative business that offers the same immediate return, an established customer base etc, for less than £50k.
Any business is a risk, buy a corner shop and see Tesco open up the road.
How about the stock market, pension funds, endowments, rock solid investments? You access the risks, set that against you personal circumstances, every business is a judgement call. Too few plate holders have a clue about the basics of business, they muddle along struggling to make a living, that is not running a business. There are some that do understand and make a very nice living but that is a crime to the likes of "sussex".

As I previously stated 20 years ago in restricted areas it may have been safer to invest in a cab and plate.

However, we are not talking about 20 years ago we are talking here and now. You say that any business is a risk, but buying a plate is not a calculated risk, it is a calculated gamble. There is no in-between, at the end of the day you either have a plate that has a value or you have a plate that is worthless. The decision of the latter is not under your control. Just ask the owners in Stratford and Cardiff, etc, etc, etc.

When you venture into a business, you calculate that your business plans will give you sufficient reward and profit for the investment you are making and that there is potential for growth.

When you buy a Cab and plate there is no potential for growth, the opposite is the case. The reason I say that is quite simple, the likely hood of a councils increasing numbers is more likely than councils decreasing numbers. Therefore the more cabs that are licensed mean more hours that you are going to have to work for the same return. Someone living in Peter Pan world may say to themselves “oh! But my council won’t increase numbers” That sounds suspiciously like the argument you are putting forward in the present environment.

You mentioned 50k, you give 50k to a person in Stratford and tell him to go and invest it in a plate. I’ll take my 50k and invest it in property and in ten years time we’ll see who has made the wisest choice. You may say to me, that Stratford are going to de restrict very soon? But that just proves my point, you or I, do not know “when or where the next Stratford will be”. All we know is that “there will be a next Stratford” and that is the Gamble.

I would advise someone to buy a plate only if the price was right.

Best wishes

JD

To summarise, it's about the ability to assess regulatory and political risk, not 'business' acumen.

Mr Davies clearly has it, Mr Guest doesn't.

I think you have endorsed everything I said, you have to access the business to your personal situation. Risk and gamble are the same thing. No risk no reward that is pretty much universal. Plates may lose their re-sale value but they will still earn money for you if you work them. More cabs may mean less money or longer hours for the same money, but the most likley outcome is higher fares. Look at the De-reg of buses, cuts in service, higher fares in the "free market".
Would £50k buy property in your area, average house costs over £100K and as all other property increases in line with yours the profit is only on paper, the income potential is even worse than a taxi and the bills are much higher, rates, water etc. So what does £50k get you in the way of income ? A plate is entry ticket to the market, an established demand built up over years. Plates have no value only a price, the original question was about investing 25K that opens even fewer doors, I took the figure of £50k to include vehicle, insurance etc, on the road price as such.
If you cannot raise £50k you should not consider any business venture.
Having paid £25k for a plate you should have recovered that within the first year. I cannot believe any taxi grosses less than £35k per year in any area on a full time basis. The adult minimum wage is aroud £200 per week, would anyone bother to work full time for less and on this forum many drivers claim to take in excess of £200 every Saturday night. You are buying a potential income when you buy a plate. Forget the re-sale you are looking for income not growth.

How quickley you have forgotten "negative equity" in the property market, ask those that bought a house at the peak of the boom.
Interest rates are rising the Gov. of Bank of England is giving dire warnings about a fall in house prices. Still want to be in property ?
As in all investments its in the timing.
De-limit has been around the corner for 25 years, for as long as I have been a taxi driver. The cost of a plate has gone down in real terms but the income has increased every year. This may change but like most thing in life we adapt, people will always want transport in one form or another, we must work at protecting our market share. The future is the only thing with potential the past has been and gone. "If only" and "I wish I had" is for losers.

The man who never made a mistake never reached his full potential.

Every business is political and subject to regulation, what is business acumen if not the ability to understand these variables. It the difference between making a living and running a business.
To summarise, you are an idiot.

By this I take it that you mean driving a Cab is the personal choice of the individual who wishes to enter the trade as an owner in a restricted area. The problem I have with your basic argument is that we now live in an era where buying a Cab and plate in a restricted area is major risk. I’m sorry to keep going back 20 years or so but it is relevant.

In this area just over twenty years ago you could walk into a bank and get a certain amount of collateral on your plate, you can’t do that these days. If we both walked into a bank for a loan and you said you wanted a loan of 50k to buy a plate the bank manager would tell you instantly that there is no collateral in a plate and show you the door. If I told him I wanted 50k to invest in property I know for a fact the door would not be an option. That is the difference between a calculated risk and a Gamble. The Bank manager would take a calculated risk that the property will increase with the cost of living year on year, whereas a plate could be worthless tomorrow. If you don’t believe me just go and ask your Bank manager for a 50k loan to buy a plate.



Risk and gamble are not the same thing, in a calculated risk there is a certain amount of certainty, in a gamble there is no certainty whatsoever. That’s why I mentioned the Bank manager scenario. The Bank manager will asses the risk of the Bank losing 50k, with property the risk is highly diminished because property in the main increases in value. With a plate there is no comparison whatsoever because it has no value in law and is therefore a complete gamble as far as the bank is concerned.



50k in this neck of woods will buy you a plate and that’s all it will buy you. If you want a new Cab its going to set you back another 30k. We all know the economics attached to owning a Cab and the benefits an extra driver can bring but we are talking about the initial decision to buy. It matters not what earnings can be made, the relevance is if the speculation of 50 grand plus interest for a plate is a wise choice under today’s climate? You obviously think it is, I take a different view.

You failed to mention the amount of interest you are going to pay on a 50k loan. Your fully covered 50k loan will set you back around 69 grand over 5 years, at an interest rate of 7.9 percent, which is about the national average.

I suppose you realise that the repayments on that loan will amount to around 1150 pounds a month and that in order to get such a loan you would no doubt have to put your house up for collateral. How ironic I mentioned investing in property, because that’s what a bank would require in order to get a loan for a plate, simply because the plate itself has no value.

You also fail to take into account the status of being self employed, lending companies take a very dim view of lending "LARGE" amounts of money to self employed people who work in an industry which has no economic Guarantees. Therefore the loan a person requires may come at a higher interest rate than would be the norm.

Best Wishes

JD

I don't know which boom you are referring to but negative equity is a short term scenario. In the Long term equity in property will always rise. It rises because the cost of living increases and with it earnings, therefore the value of property increases also.

I bought my house a very long time ago and its value has far surpassed the value of my plate. So I can talk from personal experience as far as value goes.

Delimit only surfaced in 1986 when the 1985 buses bill became law. That is only 18 years ago. Since then there have been a "SUBSTANTIAL" amount of Councils who have indeed deregulated numbers. The trend for deregulating numbers has become more pronounced since the OFT report highlighted the fact that it was against public interest to limit numbers and that councils who couldn't justify limiting numbers should deregulate.

I fully understand your argument but it seems to me that you are the one failing to take into account the whole picture.

For instance, have you not seen a pattern emerging throughout the country since the Government endorsed the OFT report? Has it not dawned on you that the local Government network have come to the conclusion that they will not be able to justify limiting numbers under the terms of the Governments statement and OFT report.

Am I the only one to see that there is a growing acceptance in local Government that de restriction is the only option left open to them when they can’t justify their actions to be in the public interest?

I think everyone should read the NTTG Blue print and see how scared they are that the policy of restricting numbers is one that can't be won.

You won't find any reference to suggest the NTTG is scared of what the future holds but the very content of the blueprint itself makes it quite clear that they are.

Best wishes

JD

It might be universal in most other trades, but most certainly not in this one.

Most taxis and all PH in this country work without numbers restrictions. They don't need protection from fair competition.

Alas some weaker parts of our trade have to be protected from fair competition, because they just can't hack it.

_________________
IDFIMH

Oh no John, you are not alone.

Depending on the guidance from the DfT, I can't see how any council will be able to justify restricting numbers, and getting punters to say less cabs is a really good thing.

_________________
IDFIMH

Your house and every other has gone up in price/ "value" that does not mean you have made any real gains. Ask any financial adviser where to invest and they will ask you what you are looking for "growth" or "income" from your investment. Taxis are an "income" investment, add up your income from your plate over 20 years and compare that to the "growth" in your house, now spot the best investment. Even if your plate is now worthless you cannot disregard the income because you have already spent it and it's not a lump sum.
Negative equity is not a short term scenario if you lose your house.
Still no answer to the question, what other business could you invest in with £25k that has the same potential?

Yes lots of Councils have deregulated over the last 18 years and the OFT report has shown that the overall number of vehicles (PH + Hackney) drops following dereg. Service to areas outside town and city centre declines. Councils have MORE reason not to dereg now than they have ever had because the data shows that there is no benefit to the travelling public in dereg.
Every example in the public transport industry, buses, trains, coaches and taxis shows that in an unregulated unrestricted free-market services decline and prices rise. Re-nationalnisation of the railways is being discussed so nothing is set in stone.

yes< nationalisation is on the agenda because it costs more to run private railways than national ones>

do you think that taxis will be nationalised?