Téo Taxi closes, leaving some 450 drivers unemployed

Téo Taxi, a Montreal-based electric taxi company, is shutting down for good — leaving some 450 drivers without work, according to the employee's union.

'It's not that much of a surprise,' says driver who learned this morning that he is no longer employed

Téo Taxi has been operating in Montreal since 2015, but it is now closed. Riders used an app to hail electric taxis driven by salaried drivers. (Radio-Canada)

Téo Taxi, a Montreal-based electric taxi company, is shutting down for good — leaving some 450 drivers without work, according to the employee union. 

"Téo Taxi today is not yet profitable and, above all, no longer has the support necessary to continue its activities," said the company's co-founder and board chair Dominic Bécotte Tuesday. 

"It is with broken hearts and great sadness that we must put an end to Téo Taxi."

The fact that electric vehicle technology is still in development hurt the company's ability to expand, he said, but that wasn't the only reason for the company's closure.

Quebec's strict rules governing the taxi industry also prevented Téo from raising its rates, according Bécotte, an XPND Capital partner.

"The restrictive regulation did not give us authorization to adjust fares to the demand," he said.

"Téo Taxi clients were open to a reasonable price adjustment."

Union ready to fight for severance pay

The Teamsters union says drivers received a letter by email informing them that the company was ending its activities as of Tuesday and they were all dismissed.

"This restructuring is not only necessary, but inevitable given the loss of support from Téo's main partners," the letter said. 

"Although the difficult situation of Téo Taxi had been public for some time, the announcement took several employees by surprise since they believed that the company still had a chance to be saved," union spokesperson Stéphane Lacroix said in a statement.

Dominic Bécotte blames Quebec's taxi regulations for Téo Taxi's closure. (Radio-Canada)

The letter specifies that the employees will be paid for the hours they worked, but does not mention severance packages, Lacroix said, and that is something the union will be following up on — using "legal means to enforce the law."

The majority shareholder of Taxelco is XPND Croissance Fund, which is part of XPND Capital, where businessman Alexandre Taillefer is the founder and managing partner. 

Taillefer co-founded Téo Taxi, an app-based service, in 2015 and bought out two of the main traditional taxi companies that operate in Montreal as well. 

Taillefer declined Radio-Canada's request for interview Tuesday morning.

Received government money

Taxelco received $9.5 million in grants from various government departments and the Liberal government authorized a $4 million loan.

The Caisse de dépôt et placement du Québec and the Fonds de solidarité FTQ are two major shareholders of the Taxelco and, along with Fondaction CSN and the XPND Capital fund, injected $17 million into the company a year ago as part of a new round of financing.

That money was used for the purchase of new vehicles and the hiring of staff.

No collective agreement

"We knew that the company was going through some tough times, but we weren't expecting news like this this morning," Christopher Monette, another union spokesperson, told CBC. 

Téo Taxi employees joined the Teamsters in October, Monette said, because of difficulties they were having with the company's management.

There were some arbitrary firings, he said. Since then, he said there has not been enough time to even begin negotiating a collective agreement.

Alexandre Taillefer poses for photos with his new fleet of electric taxis at Téo Taxi's launch in November 2015. (Ryan Remiorz/Canadian Press)

In fact, the union was going to begin consulting employees in the coming weeks on that agreement.

"But obviously, that's not going to happen," he said. "The Teamsters have been trying to reach out to the company for about a week and half, two weeks now to discuss the situation. Nobody has been returning our calls."

Receiving the bad news

Montreal driver Hans Péladeau-Bisseger arrived at work for his 3:30 a.m. shift this morning and received his car assignment as usual.

As far as he could tell, nothing was out of the ordinary.

Péladeau-Bisseger realized something was up when he tried access his assigned electric taxi with his key card. He couldn't get in. So he called dispatch and was told to come back inside.

All the cars that were already out on the road were called back to the station as well, he said. Once drivers were gathered, management delivered the bad news.

"We were told to go back home and we would get information in the next days and weeks," he told CBC Montreal's Daybreak on Tuesday.

Téo Taxi driver Hans Péladeau-Bisseger says he has had his guard up in recent weeks, knowing the company may be struggling more than management was letting on. (Valeria Cori-Manocchio/CBC)

He then received the dismissal email a couple hours later telling him that Téo is closing.

He said drivers "had no information" about the company's money problems, so when his Class 4C drivers' licence, required for taxi drivers, was up for renewal last week, he paid the annual fees. 

Péladeau-Bisseger started working for the company back in October and, overall, he said, "it was fun."

Despite rumours that the company was in financial trouble, management had been saying everything was fine, he said. And, from his point of view, everything appeared to be running smoothly. Still, he was wary.

"I kept my guard up" he said. "For me, it's not that much of a surprise, although it is frustrating."

With files from CBC Montreal's Daybreak, Valeria Cori-Manocchio and Radio-Canada