No Cap On Companies, Hard Cap On Seats
No Cap, One Door
On Saturday, Secretary for Transport and Logistics Mable Chan told everyone there is no cap on how many companies can apply for a ride-hailing platform licence. Uber, Didi, whoever wants in, line up. Sounds generous. Sounds like the government finally loosened its grip.
Here's the bit nobody put on the same slide. Underneath that open door sits a hard ceiling of 10,000 vehicle permits, total, for the whole territory. So you can have unlimited companies fighting over ten thousand seats. That's not an open door. That's a nightclub that dropped the cover charge and kept exactly one bouncer counting heads at the only entrance.
Doesn't matter how many people show up outside now. Only ten thousand get in. The government gets to say it welcomed everyone, and technically it did, right up to the point where the room is full.
The Street Already Knew
Here's what makes the 'no cap' line even funnier. Former lawmaker Michael Tien reckons 11,000 of Hong Kong's 16,000 urban taxis are already driving for Uber on the side, quietly, for years, while the whole arrangement sat in a legal grey zone nobody wanted to touch. The government just spent about 12 years not deciding what to do about an app that most of the taxi fleet was already using every day.
So Friday's application window, opened by the Transport Department for Uber and Didi to formally apply, isn't creating a new industry. It's handing out paperwork for one that's been running under the table for over a decade. More than 9,000 drivers have already enrolled for the new combined taxi and ride-hailing exam, which the department starts running in mid-September.
The exam and the licence form are catching up to a habit, not inventing one. The city didn't wait for permission to start using Uber. It's the government that's finally getting around to admitting it happened.
Owners Left Holding Paper
While Chan was explaining the rules, the actual damage was already done. A red taxi licence, the kind you need to drive an urban cab, is worth about HK$2.62 million now. Back in 2009 it peaked at HK$7.66 million. Green licences for the New Territories fell too, down to HK$1.45 million. The market had already priced in an app the government spent 12 years not regulating. Nobody had to wait for Saturday's announcement to do the maths.
About 1,800 of the territory's 18,163 taxis, roughly one in ten, are now at risk of the bank taking the car back because the owner can't keep up loan payments on a licence that isn't worth what it used to be. Chau Kwok-keung, who chairs the Hong Kong Taxi and Public Light Bus Association, says his members feel hopeless about where this industry is headed.
These are people who paid market price for a piece of paper the government just told the whole city didn't need to be scarce. Now it's a ten thousand seat room, and nobody's promised them a chair.
So who actually gets the 10,000 permits? The government hasn't said whether drivers already running Uber informally get first claim, or whether it's first come, first served for whichever platform files the cleanest paperwork. Full penalties don't land until August 2027, a year of runway before anyone gets fined for doing what half the fleet already does. Right now nobody, including the government, will say who ends up owning this business.