Daegu plans to resume its taxi fleet reduction program in 2027 to address an oversupply of taxis and ease financial difficulties facing the local taxi industry.
The city will begin by reducing 45 vehicles next year and plans to expand the compensation program in stages depending on industry participation, according to Daegu city officials Wednesday.
A 2025 assessment of Daegu's total taxi quota found that the city had 15,703 licensed taxis against an optimal figure of 10,257, leaving 5,446 vehicles — 34.7 percent of the total — in excess supply.
Daegu reduced its taxi fleet by a total of 1,248 vehicles between 2016 and 2021 before suspending the program in 2022. The supply-demand imbalance worsened later that year after the city fully lifted its taxi rotation restrictions, putting more vehicles back on the road.
Under the program, operators who surrender their taxi licenses will receive compensation. A taxi reduction committee — made up of representatives from corporate and individual taxi operators as well as transport workers — will deliberate on the scale of reductions and per-vehicle compensation amounts before finalizing the details.
The 2027 program budget stands at 585 million won ($432,000), with the central government covering 30 percent and the city the remaining 70 percent. Per-vehicle compensation will be drawn from a government subsidy of 13 million won, incentives from related public agencies and contributions from the industry.
The city said it aims to bring taxi supply to an appropriate level through the program while stabilizing industry finances and improving earnings for drivers.
Lee Seung-hun, chairman of the Daegu Corporate Taxi Operators Association, said the industry had long suffered under persistent oversupply and financial hardship. "We will work closely with Daegu to ensure this fleet reduction program proceeds without a hitch and leads to a full normalization of the taxi industry's operations," Lee said.
Daegu Mayor Choo Kyung-ho said the taxi industry's structural difficulties were a problem for the city's broader livelihood economy. "Through the fleet reduction program, we will improve operating conditions and provide citizens with safer and more convenient transportation services," Choo said.
kbj7653@heraldcorp.com
