According to a Business Times article published earlier this month, Japanese car manufacturer Toyota had recently installed GPS systems in 10,000 taxis in Thailand to enable the company to gain real-time insight on traffic congestion. The systems sends data to Toyota’s data centres through the cloud.
This highlights a novel way for taxi companies in Singapore to possibly create new revenue streams. In Singapore’s stock market, companies that provide taxi services locally include ComfortDelGro Corporation Ltd (SGX: C52) and SMRT Corporation Ltd (SGX: S53).
The Business Times article mentioned that Toyota “has already commercialised traffic insights on roads and its respective congestion hours that hold the most attention of road users, as recommended sites for billboard advertising.”
If either of the two taxi operators mentioned above – or other private taxi companies, for the matter – are able to install similar cloud-based technologies to their vehicles, they could gain valuable insight on traffic conditions in Singapore. Possible customers of such traffic condition could be the government of Singapore (for more efficient road planning) or even to individual consumers so that they can plan a smoother journey.
ComfortDelGro has nearly 17,000 taxis in its fleet at the end of 2015. SMRT, meanwhile, reported a fleet size of 3,500 taxis as of 31 March 2016.
I must stress that there has been no mention at all from ComfortDelGro, SMRT, or other taxi companies in Singapore that they are looking at such new revenue streams. Moreover, the issue of whether such ventures can move the needle for the taxi companies is also a big unknown. But, it’s always useful to look at new technological developments and think of the possible implications.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Ong Kai Kiat does not own shares in any companies mentioned.