Colux Taxis pays an average of €10,000 to €15,000 in fuel bills each month. Photo: Christophe Lemaire / Maison Moderne

Colux Taxis pays an average of €10,000 to €15,000 in fuel bills each month. Photo: Christophe Lemaire / Maison Moderne

Taxi companies are beginning to worry about historically high fuel prices, especially as the fall in business tourism is also affecting results.

Fuel prices have never been so high in Luxembourg. As of 13 October, it cost €1.395 for a litre of diesel, €1.549 for a litre of petrol 98 and €1.460 for a litre of petrol 98.

In addition to motorists’ wallets, this price level is beginning to affect companies that consume a lot of fossil fuels. This is the case of Colux Taxis, among others. With a fleet of 80 vehicles and around 20 freelancers, Colux Taxis pays an average fuel bill of €10,000 to €15,000 each month.

“I have never known fuel to be so expensive,” said Olivier Gallé, CEO of Colux Taxis. “In just a few weeks, there has been an increase of 0.5 cents. To experience such a price surge, you have to go back to the time to when it was decided to limit motorways to 120km/h because fuel was too expensive,” he added.

Mitigating the rising fuel prices won’t be easy for the company director. “We can’t have fun adjusting the price of our trips every day according to the price of diesel and petrol,” says Gallé, adding: “On the other hand, we do prevention work with our drivers. We have digital tools that show the consumption of cars and drivers. We then have to do a specific job to sometimes remind them that they need to be careful.”

Colux Taxis, which uses mostly diesel cars that consume an average of five litres of fuel per 100 kilometres, has seen its fuel costs rise by more than 31% since the beginning of the year. Even though the company has a specific contract with a fuel supplier, the increase still has an impact.

“Our annual operating margin is between 2% and 3%. We are far from a normal level of 10%. If this persists over time, it will also mean less space to invest in new vehicles,” says Gallé, who does not hide the fact that the amount of business is far from its pre-crisis days. “We are still suffering from the lack of business tourism. We must be at a third of what we were doing before Covid-19.”

The situation worries many companies. When asked about it, many are calculating the economic consequences of such a price hike. “I have asked my financial director to carry out an impact study on the issue,” says François Remogna, CEO of DHL Express Luxembourg, for example.

Electric options not there yet

For taxis, the electrification of the fleet does not seem to be a solution at the moment. “We did tests with 100% electric cars. We realised that it was twice as expensive as diesel, from the purchase price to the cost of the infrastructure and recharging. But the first obstacle is the charging time. With an electric car, I can’t put a day/night schedule with two drivers on the same car. There are fast charging stations. But it is technically impossible (or very expensive) to install 10 or 20 for the entire fleet of 80 taxis,” said Gallé. He admits that hybrids could be a solution, but only for certain types, and on condition that they can benefit from state aids as is the case for private individuals when purchasing such a vehicle.

DHL Express plans to make a radical change in the coming months with 100% electric vans. However, the delivery of the vehicles has been delayed due to the shortage of semiconductors currently affecting car manufacturers.

This story was first published in French on . It has been translated and edited for Delano.