End of the road: Téo Taxi closes shop, fires 460 drivers

By Jason Magder, Montreal Gazette

Launched with great fanfare and lots of promise three years ago, the city’s electric taxi company says it will cease operations.

Téo’s drivers were the first to learn of the news when they showed up for work at the company’s garage on St-Patrick St. early Tuesday and were greeted by security guards barring them entry.

A total of 460 drivers employed by Téo Taxi received notices of dismissal.

Hours later, at a news conference, the company’s management confirmed rumours circling for about a week that the company would suspend operations.

“It is with a broken heart and lots of sadness that we have to put a halt to the activities of Téo Taxi,” said Dominic Bécotte, a co-founder of Téo’s parent company, Taxelco.

He said the company was not profitable, and requests to the government for dynamic pricing — such as adding a surcharge during peak periods, charging extra to ride in a Tesla, or a fee to reserve a car in advance — had fallen on deaf ears.

Problems with electric cars, many of which must be recharged several times a day, especially during the winter months, also contributed to the closing, he said.

Despite reports the company would restructure, Bécotte said Téo will cease to exist and not live on in any other form.

Taxelco also owns Diamond Taxi and Hochelaga Taxi. Those traditional taxi companies will continue to operate.

Bécotte said the company’s efforts will now turn to electrifying those taxi fleets.

As for the 192 cars that formed Téo’s fleet, including several Teslas bought for more than $100,000, those likely will be sold off.

“It is with a broken heart and lots of sadness that we have to put a halt to the activities of Téo Taxi.” John Mahoney / Montreal Gazette

In Gatineau for a meeting of the provincial cabinet, Premier François Legault said the government examined several scenarios and concluded it can do nothing to help Téo Taxi at this stage.

“At first blush it’s not possible for the government to help the company,” Legault said. “We looked at different scenarios — especially to save the higher-paying jobs. There were some.

“If someone was stepping up to take over the company (there might be a chance), but now we can’t do anything.

“It’s sad. It was an avant-garde business model with electric cars and a complicated software application. But I don’t think we will be short of taxis in Quebec.”

Bécotte said the company will meet the drivers in the coming days and weeks.

Christopher Monette, the director of public affairs for Teamsters Canada, said the union will fight for the employees to get severance pay, for which he believes they are entitled.

He said the company treated its employees badly in the final days.

“We had been trying to get a hold of the company since the rumours came out, and the company did not call us back. Obviously that’s shameful. Also, the workers who showed up around 3 a.m. only to be turned away by security guards, that’s also not acceptable.”

Téo launched with a different business model than traditional taxi companies. Using solely electric cars, the company was powered by an Uber-like mobile application that allowed customers to see on a map where their drivers were.

Bécotte said the app will continue to be available to hail Diamond Taxi cabs.

Teo Taxi driver Nasser Salmi, rear, and Teo’s chief mechanic Elie Eid unviel an electric car with a Diamond Taxi dome light in 2016. John Mahoney / Montreal Gazette

Téo employees were paid an hourly wage, worked a set number of hours per week, and were eligible for benefits and vacation time.

(Traditional taxi drivers are autonomous workers and often work 60- to 70-hour weeks to make the payments on the mortgages for their taxi licences, many of which are purchased for more than $200,000.)

Téo also got special dispensation from the government to rent and purchase more taxi licences than the number of cars in its fleet. On Tuesday, the company was still renting 170 taxi licences, and Bécotte said it will negotiate with the owners of those permits to settle with them.

Bécotte said the company received $7.5 million in government subsidies but the bulk of that money was available to anyone operating a taxi company or buying an electric car in the province.

The former Liberal government approved a loan totalling $4 million.

Téo Taxi was the brainchild of well-known Quebec entrepreneur Alexandre Taillefer, who was the face of the company when it was announced in 2015.

Taillfer stepped away from Téo and Taxelco last May, but is still listed as the managing partner of the Fonds XPND Croissance — the majority owner of Taxelco.

La Presse Canadienne contributed to this report.