The number of bankruptcies in Japan’s taxi industry is rising sharply. Data released by the Japanese Imperial Database website shows that 35 taxi companies in the 2024 have been legally liquidated with debts of more than 10 million yen (463,000 yuan) , a total of 82 taxi companies chose to withdraw from the market. The number of 2023 increased by 19, or 30.2 percent, from 63 in 2010, surpassing 73 in 2019 and hitting a record high.
A taxi stand in Tokyo, Japan. (visual China)
Understaffing, such as drivers, is the main reason for at least 40 per cent of the 35 bankruptcies in the 2024 taxi industry, according to the report. There have been one or two cases of understaffed bankruptcies every year, but 2024 cases have been particularly high. The increasing shortage of taxi drivers and the surplus of taxi vehicles due to understaffing have led to a decline in vehicle utilization, which has had a serious impact on the operation of taxi companies.
At the end of March, there were about 220,000 taxi drivers 2023 the country, down about 20 per cent from March 2019 before the outbreak, according to Ministry of Land, Infrastructure, Transport and Tourism data. By contrast, corporate taxi fleets have declined by less than 10 per cent, with drivers reducing their fleets at a much faster rate. The mismatch between supply and demand has further aggravated the industry’s predicament.
In addition, the taxi main fuel prices continue to rise on the taxi enterprises also caused a heavy burden. Soaring Liquefied petroleum gas prices, rising energy costs and significantly increased operating pressure are also contributing to the rise in the number of taxi operators dropping out of business.