ComfortDelgro (CD) is one of the largest multinational land transport companies with

operations in Singapore and 6 other countries1. It has a global fleet of 46,300 vehicles and
provides a huge range of services including bus, taxi, rail, car rental & leasing,
automotive engineering services, testing services and insurance broking services2.

However, CD has frequently been accused of having a monopolistic control over the taxi
market. According to Singapore Business Review, CD and its subsidiary, CityCab, owns
a 60% share of the taxi market3. Moreover, Singapore LTA has announced new regulation
in 2012 that restricts taxi companies to expand their taxi fleet by a maximum of only 2%
per annum4. This will further decrease the ability of other smaller taxi companies to grow
their fleet size to compete against CD for market share. Without any fair form of
competition, CD is the strong market leader and is able to increase their taxi fare and
other competitors have to follow. This action maximizes CDs profits at the detriments of
its taxi operators and customers. As such, the act of stifling competition in the taxi market
can be seen as unethical.

This act has impact on several CDs stakeholders. Amongst the most impacted are its taxi
operators. Fare hikes are usually accompanied by increase of taxi rentals by similar
magnitudes, which place a downward pressure on their earnings. Moreover, fare hikes
1 China, United Kingdom, Ireland, Scotland, Australia and
VietnamSource: http://www.comfortdelgro.com/global-network.aspx?
id=143
2 http://www.comfortdelgro.com/ourcompany.aspx?id=4
3 http://sbr.com.sg/transport-logistics/news/how-comfortdelgros-taxibusiness-beat-peers-in-revenue-game
4 http://www.lta.gov.sg/apps/news/page.aspx?c=2&id=48f0266f-91bf4347-aca8-9bad65311cd2

may decrease the demand of taxi rides by customers, further reducing their potential
income. Customers are deeply affected by this monopolistic control as well. Customers
have to bear the brunt of any fare hikes and they have very little bargaining power in the
taxi market. However, shareholders may benefit from the monopoly, as it will maximize
the profits from their stakes in the company. Lastly, government agencies, especially the
Land Transport Authority (LTA), will face great pressure from the public to regulate the
fare prices and to maintain taxi availability standards.

Several ethical principles will be used to determine whether the act of stifling
competition and having a monopolistic control over the market is an unethical act.
Firstly, this act can be deemed as ethical as it does not violate any law or government
requirements. The onus of setting stricter government regulations to protect the interest of
the public is on the LTA, and not on CD. Under this ethical principle, CDs act is totally
sound and ethical.
Secondly, this act can also be seen as ethical under the self-interest principle. Under
Singapores capitalism system, private entities undertake economic activities to boost
their own profits in the most efficient manner. Having a monopolistic control of the taxi
market is ethical as it increase their own profits, and maximizes their self-interest.
Thirdly, under the individual rights principle, CD is ethical as it has not restricted the
fundamental rights of any individual. Customers are allowed to make their own decisions
on whether to use CDs taxi or not. Taxi operators can also freely choose the companies
to work for on their own. Without any restriction of individual rights, CD is ethical.

However, using other principles to determine the ethicality of CDs monopolistic control
will lead us to a different conclusion. Firstly, having a monopoly in the taxi market does
not create greater utilitarian benefits. It allows CD to increase its profits without the need
of increasing its productivity or efficiency. The society will benefit more from a
competitive market, which will bring better taxi services and fares for the people.
Secondly, under the distributive justice principle, CDs act is not ethical as it does not
promote equitable distribution of benefits. It takes the giant share of the benefits from this
monopolistic control, and customers and taxi operators have to pay the price for any fare
hikes that CD introduces.
Thirdly, CDs act also restricts the contributive liberty of its customers. By having such a
large market share and being the price-maker in the taxi industry, it reduces customers
freedom of choice. This reduces market exchange, which is essential for social
productivity. Therefore, it is an unethical act under this principle.

In conclusion, CDs monopolistic control over the taxi market stifles competition and
prevents the market from being more efficient. After using the various ethical principles
to analyze the issue, I judge that CDs actions are ethical. Although the utilitarian,
distributive justice and contributive liberty principles are true, I feel that it is not CDs
obligation to promote greater good for the society. It is the role of the government to do
so, by coming up with stricter regulations to maintain a highly efficient and affordable
taxi market for the people. On the other hand, CD is a profit-making company. Its
purpose is to maximize the benefits of its shareholders and they are doing well by having
a monopolistic control over the taxi industry.