Multi-Criteria Assessment of Taxi Transport Services for Public Procurement: Case Study for Bacau City

Abstract

LCA methodology is often used in public procurement decision making. The European Commission introduced Life Cycle Costing (LCC) in 2014 to support this methodology. LCCs take into account costs incurred during a service, work or product’s lifetime. Application management techniques of LCC offer a better awareness of the factors that influence the resources and costs in the case of procurements. The identification of the factors that influence the costs is the main key of the LCC tool. In such a way, the life cycle management is focused on efficient purchasing. The awareness levels of the LCC criteria influence the cost and will also highlight other aspects of existing products that could benefit from the involvement of life cycle management. Taxi transport services (as an alternative to public transportation) are a sector of the economy with a good income when acquisitions are properly carried out. When the acquisitions are analyzed, governmental and local regularizations should be taken into account. Today, cities, as well as small towns, look forward to improving the quality of life of the citizens and reducing pollution. The acquisitions of buses/cars for public use must be carried out with respect to the required performance of the cars. On the one hand, the municipality should be in line with the European Commission’s policy; on the other hand, it should be in line with the state’s public procurement requirements. An acquisition must also be reasonable in terms of price, lifetime, environmental impact, circular economy and meeting citizens’ needs. The goal of this paper was to analyze the acquisition of cars for taxi services from the perspective of public procurements. The study was performed with the help of the Taxi LAL company from Bacau County. The LCC techniques were applied to identify the most “acceptable” as well as the most “profitable” choices for taxi services. For a better understanding of the problem, within the present paper the mechanism of cost assessment for a product modernization was exemplified.