Taxis vs Private Hire Vehicles: Similarities and Differences

Did you know that despite the use of taxis and private hire vehicles (PHVs) interchangeably, they are not the same thing?

Yes, while both modes of transport play an important role in the UK transport system, they operate under different regulations that affect everything from appearance to insurance, fare structure, booking, and licencing, which is why both drivers and passengers alike must know the differences and similarities between these two services.

This article will delve into exploring the distinctions between these two services.

But before we do that, let’s discuss what Taxis and private hire vehicles are in detail, shall we?

CategoryTaxisPrivate Hire Vehicles (PHVs)Appearance and AccessibilityDistinct colour scheme (black/yellow), 'Taxi' or 'For hire' roof sign, blue and white plate at the back, yellow/green licence disc on front/rear windscreen. Wheelchair accessible.Identified by door signs, yellow licence plate at the back, yellow licence card on the windscreen, and in London, a TfL 'prebooked-only' sticker. No strict model requirements.Licensing and Training RequirementsStrict licensing by local authorities, must be over 21, and pass extensive training, medical exams, background checks, and local knowledge tests (e.g., 'The Knowledge' in London).Less strict licensing, requires a private hire licence, at least one year of driving experience, background checks, and a medical exam. Relies on GPS, so no local knowledge test.Booking MethodsCan be hailed on the street, taken from a taxi rank, or pre-booked.Must be pre-booked via a licensed operator, ride-hailing apps (Uber, Bolt), or traditional minicab services.Fare StructureRegulated fares by local authorities, determined by meter. Extra charges for airports, night-time, and holidays. No surge pricing.Quoted upfront. Uses dynamic pricing, meaning costs fluctuate based on demand, distance, and time. Can be more expensive during peak hours.Insurance'Public hire' insurance covers public liability and vehicle damages.Private hire insurance (PCO insurance), covers vehicle damage, passenger/public liability, and third-party claims. Cost varies by factors like location and driver history.Availability and Customer ExperienceCan be hailed instantly but availability varies by time and location. No customer review system.Can be booked in advance for planned journeys. Ride-hailing apps offer ratings and reviews for better customer experience.

Understanding Private Hire Vehicles

Private hire vehicles, which often encompass minicabs, executive cars, and ride-hailing services, differ based on the platform they are working with. However, all of them must clearly display their licence details for their passengers to see.

For PHVs, customers must pre-book their rides through a licensed operator or ride-hailing app like Bolt or Uber.

These apps connect passengers and drivers by providing a quote to the passengers before booking the trip. This way, drivers cannot charge more than the agreed-upon fees once the trip ends.

Besides, before anyone can drive a PHV in the UK, they must comply with the varying licensing and insurance regulations.

Understanding Taxis

Taxis also referred to as hackney carriages, are vehicles that are licensed to pick up passengers from selected taxi ranks or on the street with no prior booking.

They are easily identifiable by the roof sign, taxi licence plate, and the licence card displayed on the front windscreen.

Unlike private hire vehicles, you can flag a taxi down on the street, and the cost of the trip is determined by the meter. However, in cases on longer journeys, the driver and passenger can agree on a set price upfront.

Differences and Similarities between Taxis and Private Hire Vehicles

Now that we understand what taxis and private hire vehicles are different, let's look at the different areas where they are similar and different.

1. Appearance and Accessibility

Private Hire Vehicles

PHVs can be physically identified by the door signs on the front doors of the vehicle, a yellow licence plate at the back of the vehicle, and a yellow licence card on the front and rear windscreen that shows the licence expiry date, vehicle registration, and number of passengers the car is allowed to carry. Besides, if it’s in London, the vehicle should have a TfL prebooked-only sticker.

Note that all PHV drivers must always wear their photo ID while they are on shift. PHVs also do not need to have strict vehicle model requirements, but they must pass basic safety checks and MOT tests.

Taxis

Most taxis typically have a distinct colour scheme, with most of them having a black or yellow design. They can be identified by the ‘Taxi’ or ‘For hire’ roof sign that beams up when it is available. You should also find a blue and white plate at the back of the vehicle and a yellow or green taxi licence disc on the front and rear windscreen. Besides, the yellow licence means that the driver can work in local suburban areas, while the green licence means they can work across London. Additionally, taxis must have a taximeter inside the vehicle and must be wheelchair accessible.

2. Licensing and Training Requirements

Private Hire Vehicles

PHVs must be pre-booked through a licenced operator, and both the driver and vehicle must be licenced by the local councils. However, the licensing requirement for PHVs is not as strict as taxis; they are required to have a private hire driving licence, a minimum of one year of driving experience, and pass a medical examination.

Private hire vehicle drivers are also subject to background checks but less training requirements than taxi drivers. One of the reasons is that they rely majorly on GPS navigation, so familiarity and knowledge of the area are not as critical.

Taxis

Unlike PHVs, each local licencing authority requires that taxis meet exact standards, including fare regulation, vehicle type, and accessibility. Taxi drivers must be over 21 years old and have no criminal record. They are also required to undergo extensive training, medical exams, background checks, and local knowledge tests.

For example, black cabs in London are required to pass the knowledge test to show that they are familiar with the area and can navigate without a GPS.

3. Booking Methods

Private Hire Vehicles

Private hire vehicles can only be pre-booked, whether through ride-hailing apps like Uber or Bolt or the traditional minicab service. This way, there is no competition with taxis for street-hailing passengers.

Taxis

Unlike PHVs, taxis are more flexible, as passengers can take them from a taxi rank, on the street, or through a pre-booking service.

4. Fare Structure

Private Hire Vehicles

PHV prices are usually quoted upfront, allowing passengers to know the exact amount they’ll pay before booking the journey. In cases of group bookings or long trips, passengers can negotiate with the drivers to get a good rate.

However, most ride-hailing apps use dynamic pricing that factors in distance, time of day, and demand, which is why surge pricing occurs during peak hours, making PHVs more expensive than taxis due to the high demand.

Taxis

Local authorities in the town or city regulate the taxi fares, ensuring that there is no price surge. The prices are usually based on time and distance, with extra charges for airport trips, bank holidays, night-time travel, or extra passengers. This means that high demand and peak hours do not affect the price of taxis.

5. Insurance

Private Hire Vehicles

PHV drivers need private hire or PCO taxi insurance, which is a hire and reward insurance designed specifically for drivers who work with pre-booked journeys. This insurance typically covers vehicle damages as well as passenger and public liability.

It also protects the driver against third-party claims in case of accidental injury while behind the wheel. Besides, the cost of insurance depends on varying factors like location, driver age, average mileage, vehicle model, license points, and no-claims bonus record.

Taxis

Unlike PHVs, taxis are insured under 'public hire' insurance policies, which cover public liability and vehicle damages.

6. Availability and Customer Experience

Private Hire Vehicles

Unlike taxis, PHVs allow passengers to be flexible, as they can plan their journey hours and book their trip ahead of time. This way, they can avoid being stranded, especially during peak periods when taxi demand is high.

PHVs, especially through ride-hailing apps, allow passengers to use reviews and ratings to choose their vehicles and drivers. This way, they can be sure of a good overall experience during their journey.

Taxis

Unlike PHVs, taxis can be hailed from the street or at taxi ranks in most cities. However, the availability of taxis depends on the time of day and location. Also, not every area has taxi ranks, making hailing a taxi during peak hours difficult.

Besides, taxis allow passengers to be flexible, especially with unplanned or urgent trips, unlike PHVs.

Despite the heavy taxi regulations, the overall customer experience varies with driver and vehicle, and unlike with PHVs, there are no reviews to check if the driver is good or not.

Wrapping It Up

Despite the similarities between PHVs and taxis, they operate under different regulations. However, choosing one over the other depends majorly on the passengers' priorities.

For example, if it is during peak hours and there are no taxis to hail, pre-booking a PHV, despite the high probability of a price surge, may be better if you prioritize convenience over price.