Today we are going to explain what does VTC mean and what are the differences with taxis, and we are going to try to do it in a simple way so that everyone can understand it. Because these days with the taxi strikes that collapse Madrid and Barcelona, this terminology referring to services such as Uber or Cabify is being used a lot, and at Basics we want to try to make everyone understand it.
We are going to try to make it simple and without many figures and data dizziness, for that you have all the coverage in Engadget. We will start by first explaining to you what the term VTC means and in what type of services it is used. And we will finish, as we said at the beginning, telling you in summary some of the main differences with respect to taxis.
What does VTC mean
VTC is the acronym with which the term transport vehicle with driver is known, which is how it is called chauffeured vehicles that transport one or more passengers from one place of origin to another of destination.
Its difference with conventional public transport is that with VTC the passenger chooses both the starting point and the destination. This is different from other public means of chauffeured transport, which usually have certain assigned pick-up points and specific stops along the way. It is also different from simple car rental, where you are the one who has to drive and no one takes you.
Although according to this definition, taxis are also transport vehicles with a driver, The term VTC is used to talk about the rest of services other than taxi. Its activity is based on licenses, and is similar to other classics such as chauffeur and limousine services.
However, and although these characteristics almost always left them in the background, the appearance of services such as Cabify and Uber have given a new dimension to VTC, which little by little have been gaining weight within the transportation alternatives.
VTCs also have to always carry a sticker that distinguishes them from the rest, which must always be visible from the outside of the car. The design of these stickers depends on each community, and for example in Madrid, Valencia or Catalonia they must carry a sticker with the regional sign.
How they differ from taxis
Although they are all chauffeured vehicle services, there are some differences that mark the line between taxis and VTCs like Uber or Cabify. The first is in the way in which both services are contracted, since while digital VTCs all have a prepaid service and prices that are calculated before hiring, taxis usually work with a fee and do not pay until the end.
In addition, you can hail taxis on the street, take them at a taxi rank or request them through a phone call or with one of the mobile applications that exist. In this aspect, the VTCs are more limited, since they can’t stop to look for customers on the street, and they can only offer service to those who contract the service through the mobile application, in which the collection point will also be stipulated.
There are also differences in licenses, limited to two per person in taxis and without a similar limit in VTC. However, in both cases we are facing a possible bubble due to the way in which the resale prices of both types of license are growing. Even so, the prices of the taxi licenses are notably higher than those of the VTC.
After a decree law approved in 2018, from 2022 the current licenses of the VTCs will only allow to operate in the interurban area instead of being able to start and end a service within the same city. That year, the power to grant licenses will be transferred to the communities and municipalities. There is also a ratio so that there can only be 1 VTC license for every 30 taxi.
And finally there are the rates. The prices of VTCs are generally lower than those of taxis, although they are much more volatile, and in times of vehicle shortage they can rise and even exceed that of the taxi. However, despite this, Uber and Cabify have the aforementioned certainty in their favor, since users will know the total cost of the trips before hiring them, and they will not even have to pay by hand or look for money when doing everything from the mobile.
There are also differences in the salaries of drivers, which although users are not directly affected, it is something that we cannot fail to mention. As we were told on Magnet, taxi drivers without a license can earn 1,200 euros net per month in 50-hour days, while drivers of some VTC services charge less than 1,100 euros net per month, after deducting the expenses of activity, it has been reported that sometimes they do not exceed 800 euros.
Soon there may be more differences
Although there is still a bit of confusion, it seems that new differences between the two types of service are going to emerge from these latest mobilizations in the taxi sector. The Catalan Government has ended up giving in to the pressure of taxis, and will force Uber and Cabify to operate under a one-hour pre-contract. This means that in this community you will no longer be able to use these services so that they come to pick you up immediately, but you will have to “reserve” it an hour in advance.
It is not yet clear whether the measure will remain in Catalonia or will be extended to the rest of Spain. In fact, in the taxi roadmap there are measures such as an equal law for the whole country, the regulation of VTC schedules and ordering of its operation, and the imposition of municipal rates.
