In a startling turn of events, the value of taxi licences in Hong Kong has plummeted by an astonishing 63%, shrinking from a peak of HK$7.23 million in 2015 to just HK$2.68 million as of March 2025. This represents a staggering loss of HK$4.55 million, and the decline shows no signs of abating. Similarly, New Territories taxi licences have witnessed a grim fate, falling to HK$1.93 million, down 67.3% from their decade-high of HK$5.91 million, translating to a loss of approximately HK$4 million.

The crisis in the taxi industry can be attributed to several key factors. Transportation expert Professor Terence Chong of The Chinese University of Hong Kong points to the rapid expansion of public transport options, notably the Mass Transit Railway (MTR) and enhanced bus services, which have significantly diminished the demand for traditional taxis. Moreover, the rise of ride-hailing apps like Uber has dismantled the near-monopoly once enjoyed by conventional taxi services, leading to an urgent reassessment of the investment credibility of taxi licences.

Adding to the woes, economist Dr. Simon Lee emphasizes that the declining quality of taxi services—a notably lack of wheelchair accessibility and subpar customer service—has driven riders towards more reliable and user-friendly ride-hailing platforms. This trend is compounded by the ongoing economic downturn, which has further reduced the number of taxi passengers, affecting drivers' earnings and making the prospect of owning or renting a taxi less appealing.

Dr. Lee advocates for a transformative approach to address this moribund sector, suggesting that the government should consider acquiring 10,000 taxi licences at their current valuation through the Exchange Fund. By establishing a government-owned taxi rental service staffed by qualified drivers committed to delivering high-quality service, the government could potentially stabilize the market. He anticipates that such an initiative could pave the way for a public listing, projecting a lucrative business return of around 7%.

The drastic decline in taxi licence values raises profound questions about the future of urban transportation in Hong Kong. Will traditional taxis adapt to the changing landscape, or will they continue to fade into the backdrop as ride-hailing services capture the market? Only time will tell if there’s a path to recovery for this iconic but beleaguered industry.