With the Mayor of London wanting to make the city’s black cab taxi fleet the greenest in the world, our handy guide can help you decide if making the switch to electric power makes business sense
A growing number of black cabs on the streets of London are now electric powered rather than diesel. If you’re a licensed London black taxi driver, 2019 could be the time to switch to an electric taxi from the traditional diesel.
There are lots of potential benefits to consider, not least saving money week on week. Driving an attractive new vehicle could get you more passengers – and there’s no denying a spacious, quiet cab would increase a sense of calm and wellbeing while you earn your living.
Since January this year, taxis presented for licensing for the first time have had to be Zero Emission Capable (ZEC). That means having CO2 emissions of no more than 50g/km, and a minimum 30-mile zero emission range. With no more first-time taxi vehicle licences granted to diesel taxis, now is a good time to seriously weigh up the pros and cons of going electric.
Saving money while you drive an electric taxi
The last iconic diesel-powered TX4 black cabs have rolled off the production line, and the new plug-in electric-powered TX of the future has arrived on the streets of London.
Manufactured by the London EV Company (LEVC) – owned by a Chinese firm that also owns Volvo and Lotus – the vehicle has an on-the-road price of £55,599. Weekly payments to lease are as low as £177 over five years, just £10 more per week than the deal over four years for the TX4.
But, being an electric taxi it’s cheaper to run, so an investment cost can be offset by reduced running costs. Not only is the new TX kinder to the environment, but also to the cabbie’s wallet.
Maxing out the battery use, LEVC estimate a driver of a TX4 could save around £100 per week, or £24,000 over a five-year lease period. Where you live compared to central London, and how much you need to use the three-litre range-extender petrol engine to give you more battery range beyond its 80 miles from full charge will vary the exact amount you can save on fuel costs.
As expert black taxi accountants since 1997, Oscar Fairchild has accountants and bookkeepers specialising in the tax affairs of licensed London black taxi drivers who can help you quantify the savings. And steer you through other available tax breaks and allowances.
Electric Taxi Grants
Transport for London is helping to fund a Government-led Plug-in Taxi Grant, which gives taxi drivers up to £7,500 off the price of a new ZEC vehicle. And they have a £23 million taxi delicensing fund, offering owners of the most polluting taxis up to £5,000 to switch to an electric taxi.
Additionally, LEVC offer service intervals of 25,000 miles, meaning TX4 drivers could expect to spend approximately half as much on servicing.
Tax-wise, potential TX drivers received an incentive to go green as a £1,550 tax exemption for electrically driven taxis came into force for new cabs purchased from April 2018 onwards.
Technology that appeals to potential fares can make you money
While it’s easy to ignore the technology and focus on the finances, it’s a good idea to get your head around what the new TX can offer you and your passengers.
The TX is still recognisably a black cab. But it’s slightly longer and taller, giving more room for both driver and passengers, getting six in the back in comfort.
While the driver enjoys touchscreen and digital displays, passengers are going to want to get in the newer TX because of the panoramic roof, giving them a better view of London’s landmarks en route, and useful accessories such as USB charging points, on-board wi-fi and separate rear air conditioning.
Put simply, the eye-catching design, green credentials, and improved passenger experience should mean more fares long-term for TX cabbies. 500 LEVC TXs were already on the roads in London by this October.
Kim Redwood-Lee advises Licensed Black Taxi Drivers: “There are plenty of business, finance and lifestyle reasons why you might want to consider investing in the switch to an electric taxi. We’ve noticed a significant uplift in the number of Taxi clients calling to chat through the costs and potential savings. Evaluating the pros and cons is not something to do alone, and the team here at Oscar Fairchild is on hand to help Licensed Black Taxi Drivers decide the best way forward for them.”
Good for the drivers as well as the city
An electric taxi is a more comfortable, quieter space for a black cab driver to spend their working days. All mod cons with a dash of Volvo inspiration about them make the driver’s seat a pleasant space to be and can only help boost driver health and wellbeing.
More legroom and headroom make the driver cabin something to seriously consider worth investing in. And as it’s your workplace, there’s no reason why you shouldn’t have an enjoyable and practical mobile ‘office’ – a high-definition central touchscreen tilted towards the driver, which syncs automatically with your smartphone, and a driver’s seat straight from the Volvo S90 executive saloon.
Get expert advice to help you decide
Whatever taxi you think will work out best for you to run, don’t decide on your own – working with a cabbie-friendly bookkeeping and accountancy partner like Oscar Fairchild makes perfect sense for Licensed London Black Taxi Drivers.
About Oscar Fairchild:
Oscar Fairchild (incorporating Redwood Clarke since 01.09.18) is an Association of Accounting Technicians (AAT) qualified accountancy & bookkeeping practice with offices in The City of London and Billericay, Essex. Offering a wide range of services including Self-Assessment Services, Annual Returns, VAT Returns, Credit Control, Payroll, Auto Enrolment Pension and Management Account services to high growth businesses across London, Essex and Hertfordshire.