Cash for cab clunkers in Cairo
Posted: Tuesday, July 28, 2009 12:53 PM
Filed Under:
Cairo, Egypt
By Charlene Gubash, NBC News Producer
CAIRO – While General Motors sales struggle in the United States, the American automaker can’t keep up with demand for its Chevrolet Lanos here in Egypt. The car's popularity has skyrocketed due to a new
government-sponsored incentive to encourage Cairo’s taxi drivers to trade in their decades-old beaters for brand new models.
Although prospective buyers can select from five models – ranging from the modest Russian Lada at $6,607 to the pricey French Peugeot – the vast majority opt for a Chevy at $9,549.
"There is a high demand for Chevrolet. It is a durable car and people love it, but the choice is left to the driver and supplier," said Mohamed Shawky, the supervisor of the program.
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| Mohamed Muslemany |
| One of the typical old black-and-white taxis that used to rule Cairo’s streets. |
But many of Cairo’s cabbies have made their choice clear.
"Chevrolet is the most popular car because it is strong, and has spare parts readily available on the local market. Installments are cheap at only 800 Egyptian pounds a month ($143) for a five-year period," explained Magdy Mansour, the happy new owner of a 1-month-old Chevrolet. The only drawback: "It takes a lot of gas."
Easy program winning over cabbies
The finance terms are enticing. Buyers get $900 for their old taxi, which will be scrapped by the government. They can then choose between five new models, each discounted by $450 off the sticker price.
Drivers then repay the interest-free, 5-year loan in affordable monthly installments. Cabbies also are offered the option to display advertising in exchange for over $100 per month which can either entirely cover their monthly payments or defray them by half.
Egyptians are normally afraid to incur debt, but the simple, fast-track loan process and easy terms are winning them over. So far, 16,000 drivers have been approved for loans. The program, which was launched on April 6, aims to replace 34,000 taxis. Another enviable statistic: so far no drivers have defaulted on their loans that also started in April.
The benefits have spilled over into the industrial sector too by creating new job opportunities. "Car manufacturers have increased production to three shifts a day to increase production by 50 to 60 percent more," said Shawky, the program supervisor.
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| Mohamed Muslemany |
| One of the many new white taxis - but not the Chevy Lanos - rolling down Cairo’s streets. |
The cumbersome moniker for the scheme, "The Plan to Remove Old Taxis from Service and Replace Them with New Ones" may not be as catchy as the old GM tag line "See the USA in Your Chevrolet," but it has proven to be incredibly successful.
The program was the brainchild of the Ministry of Finance in response to the government’s decision to force Cairo’s taxi drivers to replace their old cars (anything more than 20 years old) by the year 2011. The program goal is to make the streets safer, less polluted and less congested by the traffic jams caused by car breakdowns. The shiny new, air-conditioned and metered white taxis are also meant to project a hipper and more welcoming image of Egypt to millions of tourists.
Saying goodbye to old, sweaty ride
The infamous old black-and-white taxis that ply the streets are often filthy, badly in need of repair, tricked out in disco lights, dangling ornaments, and blaring religious recitations or the latest Arab pop tune. To the discomfort of passengers, there is no air conditioning and the windows, door handles and seat belts are normally broken. And passengers must haggle with drivers over the price before embarking, and oftentimes drivers spend the rest of the hot and sweaty journey trying to harass passengers into upping the fare.
By contrast, the new white taxis are legally required to run their meters and accept the metered fare. Drivers will turn on air conditioning upon request and are required to visit the mechanic every two months. Drivers keep their new rides sparkling clean to tempt prospective passengers.
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| Mohamed Muslemany / NBC News |
| Abdel Latif Abdel Sadiq sits in his new white cab. He was hoping to buy a Chevy Lanos – but they were sold out |
The public is taking notice. At first, patrons were sticker shy – fearing that a clean, comfortable ride would be more costly. But the bright white taxis are winning new converts as people discover that the fares are often the same or lower.
"I think it is perfect because it is a relief to know the fees and not have to argue about it. It is cheaper than the driver telling you what to pay. And the new models are so much better than the old noisy ones," said teaching assistant Cherry Ahmed after her first ride.
For many taxi drivers, it’s also like a dream come true. "People prefer the new car. It is comfortable. My income has increased and the number of passengers has increased," said government worker and cab driver Abdel Latif Abdel Sadiq. He currently works a full-time job and drives a taxi to supplement his income. But when he retires, he expects the new taxi to more than replace his current salary.
Mansour’s family was thrilled when he drove home in his new Chevrolet cab. "I am trying to improve my standard of living by changing my old taxi to a new one because the other one kept on breaking down."
And the taxi replacement project allowed him to achieve something he had never imagined possible. "The dream of every poor man is to drive a new car."
