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Yellow cabs turning green in Canada

By Bernard Simon in Toronto

Published: January 6 2006 02:00 | Last updated: January 6 2006 02:00

The typical north American taxi is a clunky Ford or Chevrolet that long ago lost its allure to the family car buyer.

Not so in Vancouver and Victoria, British Columbia, where taxi operators have taken the lead from their Japanese counterparts. Since late 2004, dozens of Toyota Prius hybrid petrol-electric cars have been cruising the streets of the two western Canadian cities. Tokyo was the first city to launch an "eco-taxi" fleet.

Surinder Kang, operations manager at Empress Taxi in Victoria, estimates that fuel costs for the hybrid vehicles are about one-third those of traditional cabs, such as Ford's Crown Victoria. Priuses make up more than one-third of Empress's 90-car fleet.

Citing "way better handling downtown" and lower repair bills, Mr Kang says most Empress drivers plan to replace their cars with a hybrid.

Yellow Cab, Vancouver's biggest taxi company, operates 26 Priuses out of a fleet of 208. "The public seems to like them because out here on the west coast everything is environmentally correct," says Bruce Helgason, operations manger. Several other taxi companies in the Vancouver area have added Priuses to their fleets.

According to JD Power & Associates, a market research firm, the overall US hybrid vehicle market has grown from two models and fewer than 10,000 vehicles in 2000 to 11 models and a total of 212,000 vehicles sold in 2005. However, hybrids still make up only about 1.3 per cent of total light-vehicle sales.

Hybrids are, in some ways, best suited as taxis. The electric battery gets most use in stop-start city driving, maximising fuel savings. Furthermore, the higher the vehicle's mileage, the quicker the fuel savings offset the relatively hefty purchase price. "If you're using it 100,000km a year, that's where the savings are," says Mr Kang. "At 15-20,000km, I don't think it's worth it."

Toyota sold close to 110,000 Priuses in the US and Canada last year, double 2004 sales. A hybrid version of its bigger Camry sedan is due to go on sale this year.

Jim Press, president of California-based Toyota Motor Sales, says the company has done no deals with taxi fleets. And with long waiting lists at dealerships, Mr Press expresses surprise that taxi operators were able to lay their hands on sizeable numbers of Priuses.

Still, a widening array of incentives is available to hybrid owners. Under the energy bill passed by the US Congress last summer, buyers of hybrid vehicles have qualified since January 1 for a tax credit.

Mr Helgason says Yellow Cab has been encouraged by a hybrid rebate on Vancouver airport's taxi licence fee. St Paul Travelers, a big US insurer, announced yesterday that it would offer hybrid vehicle owners a 10 per cent discount on their car insurance premiums.

The Prius has some drawbacks as a taxi. It is smaller than most other cabs, and Mr Kang complains of delays of up to three weeks in bringing in spare parts.