How Israel's Iconic Shared Taxis Vanished from City Streets
A State Comptroller report reveals that Israel's shared taxi fleet plunged by 93% since 2017 due to failed reforms, soaring operational costs, and regulatory neglect.
For residents of Tel Aviv and the greater Gush Dan metropolitan area over the past decade or two, shared taxis, or "moniot sherut," were an integral part of the urban landscape. These large yellow vans bearing route numbers 4 and 5 along their windshields plied major thoroughfares, picking up passengers on demand and offering a relatively swift transit alternative without the need to wait for scheduled buses. They also operated during hours when regular public transport wound down, as well as on weekends.
However, the landscape has changed dramatically in recent years. Familiar service routes have steadily contracted, shared taxis have become a rare sight, and a once-ubiquitous transit option has been marginalized. Official data underscores a staggering collapse: according to a State Comptroller report released in November 2024, the number of active shared taxis in Israel plummeted from 844 in 2017 to just 59 in 2023—a 93% nosedive. By comparison, there were 2,289 such vehicles operating in 2005.
This decline unfolded despite a 2018 government reform aimed at expanding the sector to 2,500 shared taxis. Instead of tripling the fleet as planned, the service has virtually vanished. Out of 24 geographic clusters designated under the reform, operators were chosen in only ten. By the close of the Comptroller's audit in May 2024, only 59 out of 400 scheduled taxis in those clusters were operational. Six clusters where operators were selected never launched, and four others saw only partial service. In practice, shared taxi routes operated in just four of the 24 planned clusters, all concentrated in Tel Aviv and the central region.
A Reform Plagued by Regulatory Failures
To understand how the sector reached this juncture, one must look back nearly two decades. In 2005, the state amended the Traffic Ordinance to regulate shared taxi operations, which previously relied on traditional operator licenses. However, the amendment was enacted as a temporary measure meant to expire in 2010, though it was repeatedly extended. The State Comptroller warned in 2016 that for nearly a decade, the Ministry of Transportation failed to implement comprehensive reforms, relying instead on stopgap extensions that undermined fair competition and equal business opportunity.
"Ever since the reform was decided upon, contracts for shared taxis were extended year by year, preventing drivers from purchasing new vehicles," says Meital Lehavi, Tel Aviv-Yafo Deputy Mayor for Transportation and Road Safety. "When your agreement is continually extended without systemic stability, you hold off on capital investments and wait to see what the long-term holds. The deterioration began back then." In 2016, a government resolution mandated that route licenses be awarded through competitive tenders rather than direct renewals. The 2018 reform formally integrated shared taxis into the national Rav-Kav electronic ticketing system.
The Ministry of Transportation unveiled an ambitious plan to operate roughly 110 shared taxi lines across 23 regional clusters, aiming for 2,500 vehicles. Yet implementation lagged. By January 2020, tender procedures were completed in only ten of 20 clusters, with just a single cluster operational on the ground. Meanwhile, veteran operators working under old licenses found their permits expiring on December 31, 2021, before transition tenders were finalized, rendering dozens of long-serving drivers technically illegal overnight.
Economic Pressures and Mounting Deficits
Industry representatives fiercely criticize the tender system, arguing that bidding wars prioritizing the lowest fare ignore the true operational costs of running a route. Uri David Chai, CEO of Odelia Taxis and operator of Tel Aviv's Route 16, points to the economic unsustainability of the current model. "Take Route 66 running 25 kilometers from Petah Tikva to Tel Aviv," he explains. "The tariff price was 16.5 shekels, but winning tender bids drove the passenger fare down to just 6 shekels. Operating costs, from fuel prices which have nearly tripled to insurance premiums and garage labor rates, have surged dramatically. Companies are operating at heavy financial losses."
Additional structural challenges compounded the sector's decline. The COVID-19 pandemic severely eroded passenger volumes, prompting many drivers to abandon the profession. Subsequent initiatives by the Ministry of Transportation in 2022 to empower local authorities to design flexible local routes stalled due to legal disputes over municipal powers.
The disappearance of shared taxis has dealt a severe blow to nocturnal and weekend mobility in cities like Tel Aviv. "When I look at Tel Aviv as a city that never sleeps, one of the factors bringing it to a standstill is the lack of nighttime and weekend transportation," Lehavi notes, adding that municipal initiatives like the weekend shuttle service have faced restrictions on charging fares. Ultimately, a service that required zero government subsidies and offered unmatched flexibility has been driven to the brink of extinction through bureaucratic neglect.
