In order to counter non-commercial vehicles who are taking in passengers for profit, Shanghai’s traffic authorities are implementing a citywide car-hailing service, with operational licenses already prepared for issue to qualified drivers.
In a report by China Daily, the transportation platform aims to complement existing taxi services and it is not meant to negatively affect the existing hailing services, according to Sun Jianping, director of the Shanghai Municipal Transportation Commission.
He further added that a lawful car-hailing service has registered drivers operating licensed cars for a rental company.
For Wu Hongyang, an official from the Ministry of Transport, there should be a strengthening of regulations concerning the taxi industry.
Last May, Yiwu in Zhejiang Province issued the country's first regulation on the Internet car-healing industry.
As explained by Yiwu's transportation bureau chief, Zhou Rongxing, car-hailing services may be booked through reservations, while taxis are hailed as pedestrians are on the go.
In addition, the city requires drivers on online hailing platforms to gain proper registration, and the cars must be under a company, instead of an individual driver.
Zhou admitted that the car-hailing industry may have its own valid purpose, as it is made up of better cars and services at higher prices, which meet the needs of businesspeople and international visitors.
Furthermore, in Yiwu, there are restrictions on the car-hailing business in terms of prices and car models.
Prices will be twice the price of a normal taxi charge and cars are to be no smaller than a middle-sized sedan, no cheaper than 200,000 yuan ($32,786).
Overall, China's crackdown on the illegal pick-up of passengers for profit is still ongoing, but city transport officials have conceded by saying that they encourage new business models in the market.