Slow summer for cab drivers - enterprise story for class

Don Corey is the last driver left in his taxi fleet.

Corey, a 29-year-old former truck driver, went into the taxi business about a year ago, but his taxi service is not making enough money to pay his bills and fill up his tank.

With climbing gas prices, Corey is changing careers again. He opened Corey’s Slotshot, a new and used electronics shop, on Belmont Avenue two months ago because he thinks a second-hand store may be a lucrative answer to his financial woes.

“The gas prices have cut way into the profit margin,” Corey said.

Corey hopes people will start looking for cheaper prices with the economy, and plans to shut down his cab service once his new business becomes profitable.

Increased gas prices and fewer customers are taking a toll on cab companies. In January, gas prices hit $3.40 per gallon and in July fuel peaked around $4.80 a gallon on the East Coast, according to the Energy Information Administration.

Corey makes a 15 percent profit after taxes, he said. Before gas prices increased, he was earning a 20 to 25 percent profit.

The 150 licensed taxi drivers in Syracuse have boosted their fares to match the jumping gas prices, said Lt. Joe Cecile, supervisor of the Community Policing Division and the Ordinance Enforcement Files. In April, fares went up $1.20 a mile, Cecile said. Cab meter’s starting rate went up 40 cents from $2.80 to $3.20, taxi companies said.

Every two years cab companies can petition the city’s Common Council to raise a taxi’s meter charge per mile. In certain circumstances – like the skyrocketing gas prices –taxi services can petition to raise cab fares citywide to help their business before the two years is up, Cecile said.

“The cost hurts. That’s the bottom line,” said Bill Patton, supervisor of Lanpher Taxi. “With the rate increase, we have been close to breaking even.”

While the higher fares help taxi drivers survive gas costs, they steer customers away.

“When I mention the price of a cab ride, people say they are going to shop around,” said John Young, a dispatcher for Blue Star Taxi. “They try to negotiate.”

People have called Blue Star back for a ride when they find that rates are the same across the city, Young said.

Since more money is spent on fares, tips have become less generous.

“I used to make between $200 to $400 a night on Friday and Saturday nights,” Corey said. “Now I am lucky if I make $70 for the two nights.”

Tips during the day are even worse because people are not going out to spend money, Corey said.

“I think you are going to find business usage declines a little bit and private usage probably declines significantly,” said Bill McClellan, manager of Century Transportation, the primary cab service for Syracuse Hancock International Airport.

Sonny Singh, owner of Blue Star Taxi, thinks locals have to be careful with their money because they cannot afford the extras they used to be able to spend on.

“Business has slowed down,” Singh said. “It’s the economy itself, not just the gas prices. People are not spending as much money.”

Singh, who does not pay for his driver’s fuel to ensure company gas is not used for personal errands, fears his drivers will quit because they are not getting the tips they need for extra spending.

“The gas doesn’t stress me out,” Singh said. “The drivers do. They are complaining about gas. The drivers are going home with $60 or $80, instead of $100.”

He had one driver quit about four weeks ago and return to his old job because he was not making enough money. Singh currently has six drivers, but will need 12 to 15 in August when Syracuse University students come back for school.

Summer is an off-season for the taxi business since the students are gone.

“It’s a seasonal business,” Singh said. “The students make most of the business.”

August to May make up for the slow summer months, Singh said. This summer is far slower than the past two or three summers though, McClellan said.

“In a service industry it’s kind of hard to service people when there is no one to service,” Corey said. “I’m stuck between a rock and a hard place.”

Medicaid transportation to doctor’s office and regular customers who do not have cars or cannot drive are what get cab companies through the summer.

“Medical transportation is what keeps me going,” Corey said. “I personally would be out of business.”

Patton’s regulars keep him in business, so he helps them out.

James Robertson, one of Patton’s regulars, uses taxi services 10 times a week to go to and from work. Patton gives Robertson a break by charging him a flat $10 for a cab ride since he is a six-year customer, Robertson said.

“A cab fare used to run $12.50 before gas prices went up, now it runs $14 to $16 one way,” Robertson said.

Robertson does not own a car because he never liked driving, but he tore his ACL nine months ago and cannot walk the three or so miles to his pizza job at Nick’s Tomato Pie in Armory Square. He said the nearest bus stop was too far to walk from home.

“I can’t really afford it,” Robertson said. “Everything is going up. Some times it just kills a blue collar worker.”

Many cab drivers do not fear that gas increases will hurt their livelihood in the long run.

“I compare a cab to food,” said Doug Parish, a Blue Star Taxi driver. “Sooner or later you are gonna need it, whether you like it or not.”