Airport cleared over taxi tender

Wellington International Airport was unlikely to have breached the Commerce Act by allowing one taxi company to secure the best-positioned rank outside the terminal while all others were shunted across the road, the regulator says.

Wellington Combined Taxis, one of the city’s largest and most-established fleets, is paying the airport $1.3 million a year for the rights to a taxi rank directly outside the terminal. Until the deal was done, Combined had a rank across the road and smaller rivals had the prime slot.

The Commission received complaints of unfair competitive advantage following the airport’s implementation of a new layout for taxi services, which saw the space immediately outside the airport doors awarded to a single company via tender and an exclusive provider arrangement for non-booked shuttle services. The remaining taxi companies were relegated to a single stand

"Consumers still have a choice of taxi companies; they can simply walk past the Willington Combined Taxi rank if they wish," said Commerce Commission General Manager of Enforcement Kate Morrison in a statement today.

"With shuttles, as there is a range of other transport options, the shuttle arrangement is not likely to create a competition concern.”

The commission said it also took into consideration the "legitimate efficiency gains" and "improved customer service" the arrangement provided.

The decision comes amid heightened tensions in the Wellington taxi industry, which saw drivers striking outside Parliament and the start of a price war as taxis lowered their flag fall rates to compete.

Since deregulation of the industry, there are more cabs on the road than space on the city’s ranks, leading to territorial disputes, often along ethnic lines.

The commission said that although it will not be investigating the matter further, the decision is not binding, and that it is up to the courts to decide whether the Commerce Act has been breached.

- BusinessDesk