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In a bid to upgrade the city's taxi industry, Beijing will soon have its first joint-venture taxi company. Beijing-based Jinjian Taxi Company and Delgo Taxi Management Company from Singapore have agreed to set up the first cab company in the capital. The joint venture will have an initial investment totaling 250 million yuan (US$30.2 million) and 3,300 taxicabs. Sources from the Beijing Municipal Development Planning Commission said they have accepted the application of the joint-venture's set-up and the relevant approval procedures are under way. He Shaoqiang, general manager of Delgo's Chinese operations, said the new company will play its role in the industry's restructure in Beijing. Delgo is a large taxi company in Singapore that owns 5,000 cabs, occupying one-third of the total number in Singapore. It is also the first company who applied Benz as taxicabs in Singapore. "I hope the joint venture will take the lead in Beijing in upgrading the taxi models," He said. According to China's relevant regulations, a Sino-foreign joint venture taxi company must buy its cars in China. The cars may be made in China or imported. For imported cars, tariffs might be reduced or cancelled. Besides using high-grade cars, the company will equip the cabs with global positioning systems and attach more importance to driver training. He said the joint venture will keep the brand of Jinjian, since it has established a high reputation in Beijing. The Chinese part, Beijing Jinjian Taxi Company, is one of the famous branded taxi ventures in Beijing. It has 3,500 cabs of various models. He said Delgo has established joint ventures in Guangzhou, Shanghai and Shenyang. "Now we come to Beijing because its taxi industry has great potential, especially after the city's successful bid to host the 2008 Olympic Games and the country's entry into the World Trade Organization," he said. Li Xihua, an expert from the commercial economic research center, said the significance of the taxi industry's drawing foreign investment lies not only in capital, but more importantly in introducing advanced managerial methods, and operating beliefs of foreign counterparts. "It will make Beijing's taxi industry reach a new level both in hardware and in service," Li said. As the capital, Beijing has a large population and is visited by many people for business or travel. Its taxi transportation industry is under great pressure for better services and hardware equipment. The municipal government has decided to foster more big taxi companies with better services and equipment, and phase out the small, bad-performing ones. The government will reduce the number of taxi operating companies from more than 800 to just 200 by restructuring, mergers and granting licenses. It will also decrease the number of taxis from 67,000 to 60,000 this year. It is aiming to establish 20 brand-name operating companies, which run 40,000 brand-name taxi cabs.