Daegu Has Nation's Highest Taxi Oversupply, with 5,446 Excess Taxis... 45 to Be Cut Next Year

Daegu City announced on November 10 that it will gradually expand its taxi reduction compensation program, starting with a reduction of 45 taxis in 2027, to address the oversupply of taxis and revitalize the region's stagnant taxi industry.

According to the results of the "Fifth Daegu Taxi Fleet Size Assessment" in 2025, the city had 15,703 licensed taxis in total (5,664 regular taxis and 10,039 privately operated taxis). The appropriate fleet size was 10,257, meaning there was an oversupply of 5,446 taxis (34.7%).

Taxi Numbers and Oversupply Rates in Daegu and Other Cities

Daegu reduced its taxi fleet by 1,248 vehicles between 2016 and 2021, then suspended the program in 2022. The imbalance between taxi supply and demand has since worsened, as the number of vehicles actually in operation increased following the Ministry of Land, Infrastructure and Transport's nationwide removal of restrictions on taxi operating schedules on November 22, 2022.

Under the compensation program, taxi license holders will receive compensation after surrendering their licenses. Daegu plans to establish a Taxi Reduction Committee comprising representatives of corporate and private taxi operators and transport workers, which will review the scale of reductions and compensation levels before drawing up and implementing a compensation plan.

In 2027, the city will provide a budget of KRW 585 million, funded 30% by the national government and 70% by the city. The funding for taxi reduction compensation will consist of a subsidy of KRW 13 million per vehicle, funded 30% by the national government and 70% by the city, incentives paid by the Taxi Reduction Compensation Fund Management Agency, an organization affiliated with the Ministry of Land, Infrastructure and Transport, and the remaining contributions from the industry. The compensation amount per vehicle will be determined by the committee.

Daegu expects the taxi reduction program, which will begin next year, to help normalize the region's oversupplied taxi market and revitalize the stagnant taxi industry as a whole.

Lee Seung-hun, chairman of the Daegu Corporate Taxi Business Association, said, "The taxi industry has been under severe strain due to the long-standing oversupply of taxis and financial difficulties. We will work closely with Daegu City to ensure the reduction program proceeds smoothly and helps restore the industry's financial health."

This content was produced with the assistance of AI translation services.