Taxi Driver Online

LIFE TIME COST OF TAXI CONVERSIONS IS £100,000 HIGER THAN PURPOSE BUILT
TAXIS

After five years operating a fleet of 20 Peugeot E7 taxi conversion
vehicles, Iain Fortune, Managing Director of Myrtle Tree Holdings Limited,
concluded that his company would have been £100,000 better off if they'd
stuck with purpose built taxis.

Bristol based Myrtle Tree Holdings operate their Aztec Contract Hire
Hackney Carriage Taxis business for customers throughout the UK. In
addition the company has other automotive business interests covering coach
travel, garage repairs and body shops.

The company have recently completed their fifth annual fleet review of
Hackney Carriage operating costs. The review compared their Peugeot E7
conversion taxis against purpose built British TXI and TXII taxis.

Iain Fortune, Managing Director said, "Our report has shown that with the
E7 the residual values or depreciation of these vehicles has been
unexpectedly high and disappointing. In financial terms each E7 has cost us
£4,000 per unit more due to their lack of end of use resale value.

He added, "All Hackney Carriages suffer from having limited licensing areas
for vehicles over five years of age where a further licence to operate will
be granted. However with our purpose built TXI vehicles we can still retain
the option of use following their refurbishment, a choice which may not be
viable with the E7."

"For us it is does not make financial sense to refurbish the E7s. Each of
our vehicles have had the same parts fail and on average we have spent a
£1,000 more on an E7 to keep it running than we have on a TXI. We have yet
to do a similar cost analysis with the newer TXII purpose built taxis we
have but the running and repair costs look similar to the TXI."

"Our contract hire E7 taxis have all suffered sliding door mechanism
failures, fuel pump failures and electrical faults. After three to four
years use we find the bodies of the E7s are tired and are not worth
repairing. In the main we dispose of them on a sold as seen basis or use
them for spares whereas with the TXI and the TXII vehicles, because they
are more durable, we refurbish them and they can be re-leased to new
operators."

Iain Fortune continued, "When you look at the bottom line of our fleet
review we have found that the 20 E7 taxis, compared to our TXI taxis, have
cost us £20,000 in additional maintenance and repair costs and £80,000 of
additional depreciations costs."

"My conclusion has to be that had we used 20 TXI vehicles during the five
year period we would be £100,000 better off. This outweighs the initial
extra purchase cost of a purpose built TXI or TXII purpose built taxi."

These figures are very interesting - but I am not sure that they are the complete picture.

Because of course the total cost of ownership figures, to be meaningful, should also include the fuel costs for these vehicles for this period.

Anyone care to work out the comparitive fuel costs for these vehicles over five years.

Then we can offset the difference in those two totals against that deficit of 100k and see what the total extra cost of these vehicles really was, from the taxi owner's point of view.

_________________
The higher the fewer.

just messing with figures but try these out and adapt to your own mileage and mpg.

80000miles per year divided by 31.2 mpg =2564 gallons per year
at a average price of 95p per litre theres 4.59 ltrs per gallon=
11,768 ltrs per year x 95pence = £11,179.60
£11,179.60 per year x5 years=£55,898

80000 miles per year divided by 20mpg = 4000 gallons per year
at a average price of 95p per litre = 18,360 ltrs per year x95 pence= £17,442 per year x 5 years =£87,210

difference between the 2 is now approx £31,312 per 5 years per cab in favour of the converted

based on my made up mileage of 80,000 miles per year and made up mpg

so do the maths on your mpg and place the figures on here and see what they are. try and be as accurate as possible and lets have drivers of both types show us their figures. they may make intresting reading.

do it as above layout so we can see how you got your figures

dont know if the fuel costs were included in the original statement, as they dont appear to be mentioned.

the most important line "We have yet
to do a similar cost analysis with the newer TXII purpose built taxis we
have but the running and repair costs look similar to the TXI." think fly wheels,timing-chains,fuel injection pumps etc. the resale value of a TX2 is seriously compromised

So much for the timing chain versus timing belt argument.

_________________
The higher the fewer.

LTI taking a few more pages this month Tony?

_________________
IDFIMH

Earlier today I was asked my opinion of the detail in this report, which I understand was written some time ago. However, for one reason or another the report has only recently been drawn to our attention. It should be noted that the nuts and bolts of this report are based on the resale value of the two types of vehicles in question, even though the report does give an indication as to the vehicle maintenance costs, over a period of time.

For the purpose of "accuracy" I contacted the person who wrote the report namely Ian Fortune, Managing Director of Myrtle Tree holdings. Myrtle Tree holdings are basically a leasing company which at one time had over 100 vehicles operating in the Taxi and Private hire market. The unpredictable nature of some Taxi stroke P/H drivers lead the company to reduce their stake in the vehicle leasing market to such an extent that they now operate only 18 vehicles. Mr. Fortune advises me that the company's intention is to leave the Taxi market altogether and concentrate on other aspects of the Transport Travel industry.

I should clarify from the beginning that the report does not make any assumption that individual Taxi drivers operating these same vehicles will have the same remuneration on vehicle resale value and vehicle maintenance as was experienced by Myrtle Tree Holdings. In other words, single owners who buy the E7 and maintain the vehicle to a high standard, in all probability will not see the type of depreciation experienced by Myrtle Tree holdings.

Based on five year depreciation Ian Fortune told me the E7 had a resale value of approximately £6,000. Varying factors were commonplace in the resale of these vehicles such as the limited market and the fact that more and more councils were implementing quality control of vehicles at first registration.

According to Ian Fortune the TX1 vehicles over the same five-year period had a resale value of some 10 to £12,000.

Those of us who know the LTI market back to front and have read other reports about the depreciation of LTI vehicles might be thinking 12,000 for a five-year-old TX1 is a little optimistic? However these are the figures quoted to me by Ian Fortune.

Ian informed me that the maintenance cost of both vehicles was comparable except that the E7 spent more time off the road than the TX1. It would appear that there are, or perhaps there were? Some inherent faults attached to the E7.

I was informed MPG on the E7 is greater than that of the TX1 so if this report was based on an owner drivers perspective fuel savings would no doubt have a great effect on the overall running costs of the vehicle. This takes us back to the purpose of the report because it was not meant as a financial appraisal of running and maintenance costs it was meant purely as to the resale value of the vehicles as they stood. What driver savings were gained in between purchase and resale was not calculated in this report.

In our discussion, the basic price of a TX1 was calculated at 26K and the E7 at 22K. Whether or not these figures are deadly accurate I do not know but at the time these vehicles were purchased I think there was approximately a 4K difference in the purchase price possibly more?

Working on the figure of 4k would see a depreciation value of the E7 resold at 6K of 73%

The TX1 on the other hand with a resale value of 11k gives a depreciation value of 58%

The difference is 15% but if you take into account an E7 vehicle that has been well maintained by an owner driver, then I have no doubt that the resale value of this vehicle could well be one or two thousand pounds higher. On the other, hand the TX1 vehicle would have to be extremely well maintained in order to fetch the 11k it was calculated at.

There are many other factors that no doubt others will take into account which I have not touched upon. In fact we could go on and on listing the positives and negatives of these vehicles but under the circumstances I think we are all experianced enough to know which make of vehicle suits us best?

Regards

JD

Where is Arthur Parker of Cab Direct when you need him? You all know him he says we'll do everything to make you happy.

Below is an Email I got from a lad who's had nothing but problems with Cab Direct.


I'm having serious problems with this firm, to say the least!

[Taximart, I appreciate this firm is a revenue stream for you, but you really want to think about suspending their ads until they deliver the level of customer service they con innocent cabbies into thinking they might get!]

I'm beginning to see tales of woe from other Con Direct customers, I'd like anyone who has had a problem with this firm in the past and would like to share it with me to email me asap at kelcou1962@aol.com.

Just for the record, this is what the bunch of money grabbing sharks have done to me....

Back in April this year I decided to buy a multi-seater with wheelchair accessability. As a one-man band in a rural constituency, it'd let me provide a much better and much needed service to my customers.

Being a very satisfied customer of Fowlers - can't praise them enough - I checked in with them first, but they wanted more than I could afford at that time as deposit.

Just out of interest, I checked Con Direct, a big firm boasting a £40m turnover, loads of expensive glossy ads everywhere, and an aftersales service they claim to be the envy of the world and, above all, they understand the needs of the taxi trade. So, not some fly by night outfit that'll rip me off then. If only I'd known...

Phoned up, no worries Ray, got just the thing for you, a TXII and we only want £100 deposit. Sorted.

What a bargain! Wow. Am I an excited cabbie.

A few weeks later I took delivery of the 02 plated car. It looked fair enough.

But it soon became clear something had gone wrong. The first thing I noticed was the rear ashtrays were full! Closer inspection and it was obvious it had'nt been valeted at all.

And the battery was dead.
The cd player did'nt work.
The fuel gauge did'nt work - usefull thingy out here in the sticks!
The meter was'nt calibrated to West Dorset
The glove box was broken
The door trims were loose and flapping
No oil in the gearbox [discovered when the car broke down outside a customers house]
Incorrect tyres fitted

And then, two weeks later it broke down at 2am in the middle of picking customers up for a 15 mile trip in the middle of nowhere.

The gearbox went. Not good.

And they'd charged me £16,500 for this????

Calls to the Customer Service Manager at Con Direct were difficult. They were'nt really interested. I got the feeling my complaint was'nt being taken seriously and they certainly had no understanding of the urgency - I'm a one man band. No car No blinking income! [Derr, and??? came the reply].

It was only when I threatened to spray paint the cab with the logo 'Cab Direct = Con Direct' and drive it to glasgow [from Dorset] - at its 15mph top speed - via every taxi rank I can find, that they began to take me seriously.

Eventually they agreed to drag the TXII away and replace it with a 04 plated Eurobus....

So I took delivery of the Eurobus - it was the only vehicle with wheelchair accessability available, so no choice there then.

[oh, forgot to mention that the wheelchair restraints for the TXII were also missing]

Now, the Eurobus IS a good vehicle. Customers quickly fell in love with it, the wheelchair ramp is suberb.

Shame the cd player did'nt work [sound familiar?]
Shame the wheelchair restraints were missing [sound familiar?]
Shame you need the strength of ten men to remove the middle two seats!!!!

But I can sort of work around these issues, at least I'm back in business! yahoo!

Shame no-one can actually confirm the value of this vehicle. Is it worth £16,500 as my last one allegedly was? No-one, including Peter facenna, the General Sales Manager, can say. All I can say is its clearly a basic model, two years old with about 75k on the clock at delivery.

All Con Direct can say is 'yes, but its got metallic paint', like thats an answer????

But I'm working. Thats good. I've made a mental note never to use them again. So no worries.

And as this was the replacement for the lemon they sold me earlier, clearly they would have done everything possible to make sure this vehicle is tip top in every sense.

Thats what I thought.

Until 2 and 1/2 months after delivery, the shiney new cam belt bust. Taking out the engine.

Bugger!

No worries, I'll phone their outstanding and exemplary customer services and let them know. Be back on the road in no time!

No worries Ray, I'll check the service history and get right back to you, they said.

A day or so later i get a message left on my mobile: Hi Ray, Its Arthur Parker, Customer Services manager at Cab Direct. I've checked the service history and we fitted a new cambelt before delivery so it must be something else. Goodbye'.

Sorry, but run those sentences through the 'great customer services' engine again!!! I'm up excrement creek in a canoe without a paddle. Again. Cheers Con Direct.

After much argument they finally agree to let my local Peugeout dealer look at the car.

Their investigation shows that the water pump went, took out the cam belt and then the engine.

Fine. I've got a warranty.

Wrong. I've got a useless bit of paper saying I have a warranty insurance capped at £500 a go. Its not worth the paper its written on [Peugeots own words].

So warning to all you suckers out there - do NOT buy a second hand car from these people, the warranty really is crap.

Cab Directs response is 'phone the warranty people, goodbye'.

Hang on, something smells here and there is definately something wrong in the state of Denmark.

Cab Direct have fallen silent.

Further chats with my local Peugeout dealers result in several different members of staff saying 'well, when you change the cam belt on this particular vehicle [expert van base] we STRONGLY recommend you change the water pump'.

Ker-ching! Penny drops.

As a Peugeout dealer, Con Direct would be fully aware of this recommendation.

Clearly they skimped on a few minutes work, a few pounds in cost and simply did'nt change the water pump. If they had, it'd be under the manufacturers warranty.

And thats were stale mate sits.

This customer orientated £40m business, not wanting to spend one penny of its own money, has coerced Peugeout to offer half the cost of repair, my useless insurance warranty will cover £500 and the rest - in their mind - is up to me!!!!

I think - as does every single cabbie, mechanic, general customer and legal eagle I've spoken to - believe Con Direct are responsible to repair or replace.

But all I get from them is silence....

And what about the out of pocket expenses and loss of earnings????

A letter of complaint to Peter Facenna querying just this matter elicits a polite but disinterested response including the following paragraph...

'...with regard to vehicle costs, or refund of monies to you, again I would refer you to the Terms and Conditions of sale from Cab Direct. You will note from the terms and conditions you duly signed agreeing to 'maintain the vehicle in good condition, allowing for fair wear and tear. In the event that the vehicle is deemed undriveable at any time, consequential losses will not be covered by either the Manufacturer or Allied Vehicles Ltf (Cab Directs parent company).'

Ok, fair point Pete. But don't you think this is an unfair contract that makes NO allowances for your firm supplying shoddy vehicles?

Call me old fashioned, but I don't think a firm that sells itself on great customer service should have the need to hide behind a get-out clause.

Nope, to me a great customer orientated £40m turnover company would be saying ' Bloody hell, Ray, SO sorry! Your last car slipped through our otherwise watertight checking system, we thought we'd pulled out all the stops on this one, clearly did'nt. Don't worry, we're sending a top of the range brand new replacement to you by way of apology, learning lessons and ensuring this sort of thing NEVER happens to our valued customers again. But not only that, in the meantime feel free to hire a West Dorset registered cab so you can still work and earn a living, of course you should send the bill to us. And we'll throw in a cheque for a thousand pounds just to say sorry. We value you'.

Dream on, Macbeth.

sussex if you look at my second post on this subject it clearly states:

[difference between the 2 is now approx £31,312 per 5 years per cab in favour of the converted

based on my made up mileage of 80,000 miles per year and made up mpg]


and no LTI arent not taking extra pages.....lol

have sent the post onto LTI and cab direct today and asked for their feedback so i might put it in the mag..... hence no response from either party so far up to leaving the office.....!!

if cab direct want to speak to me again about advertising then i would love to give them a few pages.
but i wont be intimidated as to who i can put in the publication and where....!!! such as other trade publications rolling over and being told who and who not to put in, and where in the magazine they can and can not go.

im totally on the fence on this matter and placed the post on here to get
a perspective from the end users.....such as yourself.
and thats the good and bad points of the said vehicles.

i believe as JD said:

[There are many other factors that no doubt others will take into account which I have not touched upon. In fact we could go on and on listing the positives and negatives of these vehicles but under the circumstances I think we are all experianced enough to know which make of vehicle suits us best?]

but surely running costs such as fuel, servicing and depreciation must be taken into account when purchasing one of these vehicles.

apart from buying a house, purchasing one of these vehicles is probably the 2nd most expensive item anyone in the trade will purchase, and it needs to be the right choice,

whats the cost of servicing, depreciation, and fuel like on a ford sussex....!!!!

With respect to the breakdown of expenses for a hackney carriage, TfL issued this pdf back in January:

http://www.tfl.gov.uk/pco/downloads/details-of-taxi-cost-calculations-2006.pdf

From their calculations the average fuel consumption worked out at about 19p/mile (that's the fuel bill divided by the mileage).

It's interesting to note from their figures, that each penny saved in fuel consumption provides enough money to buy all the tyres for the average vehicle for the year.

In effect a vehicle running at 18p compared to one running at 19p gets free tyres.

_________________
The higher the fewer.

As a rough rule of thumb I equate each penny in fuel consumption to £9 per week or £400 per year. (Very roughly that is.)

_________________
The higher the fewer.

Sorry to hear about your problems with Cab Direct but i love them.

I've just brought my new 307sw from them. From order to delivery took about 3 weeks, you cann't beat that.

And the car turned up in the week they said it would. In fact I was still in bed when the car turned up at about 7.00am in the morning after being driven over night from glasgow.

The repayments are a little more than quoted in the ads but that happens at any car dealership.

Overall I give them 10 out of 10, hold on I'll give them 11 out of 10 as I'm now getting over 60 to the gallon where as in my old car I was getting 30 to the gallon.

_________________
kevin
http://www.monmouthtaxis.co.uk

And that's an awful lot of free tyres.

_________________
The higher the fewer.

If you were to try (and I mean try to buy a '51' reg TX1 today in London, providing it had'nt gone round the clock 4 times, you would be paying around £18K for a private sale or around £20K for a plated and passed dealer sale.

Thats how much the Nissam power unit is sought after, and a demonstration of how much the TX2 is'nt.

Vehicle price as always depends on mileage and condition, as you quite rightly say but here's a TX1 at five years of age for 10.500 with mileage which is probably commomnplace for a vehicle that in all probabilty has had two drivers.

http://www.taxi-mart.co.uk/More.aspx?id=1946

Regards

JD