GUANGZHOU, Oct. 30 – The taxi service sector in Guangzhou could see consolidation ahead of the 2010 Asian Games, as the local government has made it known they would prefer the three large state-owned companies currently operating acquire their smaller peers. The move is aimed at improving the efficiency and service quality of the city multi-million dollar taxi sector a government told Mergermarket.

The three largest taxi operators in Guangzhou include GJ Tourism Vehicle Group, Baiyun Taxi and Guangzhou Transportation Group. They are all state-owned companies. Aside from the three major players, there are over fifty small, privately-owned taxi operators.

According to the unnamed source, the Guangzhou government expects a large number of foreign tourists to travel to Guangzhou for the 2010 Asian Games, adding the government saw it as an opportunity to promote the city image.

Mergermarket reports that GJ Tourism has around 1,900 taxis, Baiyun Taxi has over 2,200 while Guangzhou Transportation Group has nearly 2,000 taxis in the city.