Taxi Sentiments, by Sean Goh, Country Head of Grab Malaysia
Recently, there has been a lot of chatter about Grab and the taxi industry. Read on for Country Head, Sean Goh's thoughts on the matter.
In recent weeks, we have heard news about two incidents: first, a small handful of taxi drivers calling for our Prime Minister to abolish all e-hailing services, which have allegedly impacted their ‘rice bowl’. Second, a small group of taxi drivers illegally obstructed the safe passage of our Malaysian drivers near KLIA, and made multiple false allegations, all under the pretext that our government is excluding the taxi community from opportunities to complement public transportation. To be fair to our community of hardworking taxi and private car drivers, and to our government’s efforts to create better access to transportation and inclusive opportunities for all Malaysians, I feel compelled to present our views and accompanying facts on these sentiments.
First, on the impact of e-hailing on the taxi community – at the heart of Grab, we have always stood for better access to safe mobility, while creating new income opportunities for all. These opportunities apply to every Malaysian, regardless of race, and regardless whether that person is a young sales professional earning extra income for her family after work at 5pm, or a Malaysian father who owns an iconic red-and-white metered car. Over 1 in 100 Malaysians have earned an income on Grab’s platform, and over 1 in 10 people in Malaysia now have better access to safe mobility.
In this spirit of inclusiveness, we introduced the ‘JustGrab’ service, which removes any discrimination between taxis and private cars by allocating each booking to the nearest vehicle, be it a taxi or private car. Unfortunately, when we first introduced JustGrab, we encountered a reluctance from our passengers to ride in an e-hailing taxi. From our surveys, we learned that this is due to two key factors: (a) very old taxis, which are perceived as inferior in safety and quality, and (b) a toxic reputation that a minority of misbehaving taxi drivers have thrusted upon the entire taxi community. In order to battle this negative perception, we enforced the same strong quality requirements across taxis and private cars – a maximum vehicle age of ten years (on par with the official regulatory requirement for e-hailing), strict quality ratings and anti-cherry-picking rules.
Fortunately, with the stronger quality measures, and with the perseverance of many hardworking, virtuous Malaysian taxi drivers, passengers increasingly accepted e-hailing taxis. Most taxis on Grab’s platform have provided great service standards that rival ‘GrabCar’, our private car service. This success indicates an interesting discovery: consumer preferences did not shift away from taxis towards private cars, but rather away from traditional street hailing towards e-hailing.
In fact, JustGrab has now become our core service, and the hardworking taxis on our platform now generate respectable earnings that are at least on par with private cars.
- JustGrab now accounts for over 70% of Grab bookings (as of September 2018)
- There are now over 17,000 taxis on Grab’s platform, and growing
- We are proactively working with the more progressive taxi associations (for example, PETEKMA in Langkawi, where we saw an increase of 156% taxis on our platform in the past 3 months alone)
- Taxi incomes have steadily increased. A full-time taxi driver can now earn approximately RM4,000 a month after commission
- JustGrab allows taxi drivers to fill 60% of idle time, bolstering their street-hailing income
Moreover, we are grateful that our taxi community is able to take advantage of several extra benefits, such as cheaper fuel, road tax, tolls and excise duties. We sincerely hope that, in the spirit of fostering a truly fair, level playing field, these benefits would also be extended to the hundreds of thousands of private car drivers too.
However, one question remains: Is Grab fully inclusive as a community? We believe we are nearly there. The crux of the problem is that the high e-hailing standards on vehicle age, quality ratings and cherry-picking may lead to some taxi drivers being inadvertently excluded. For the driver of a 12-year-old taxi in Klang Valley, rental options abound; even Grab has an affordable rental option to compete with the multitude of options to access a new vehicle. Meanwhile, for those with eligible cars, the opportunity is theirs for the taking. However, the driver of a 15-year old taxi in Kota Kinabalu may not have access to financing for a brand new car, and due to limitation in securing partnerships in every city, our car rental services are not yet available to serve him. Rest assured, we are actively working on a solution for our communities in other Malaysian cities.
As for the second topic – our government’s potential discussions with Grab to strengthen and complement first- and last-mile connectivity – it is well known that we are constantly looking to bolster our public transport infrastructure. We have embarked on several partnerships with our respected transport partners – for example, Prasarana, KTM and ERL – mainly because we believe that a stronger combined public transport network, complemented by ride-hailing, would improve access to affordable mobility and reduce our nation’s reliance on car ownership. Sadly, some parties have skewed this broader push towards supporting public transport to assert that once again, taxis or other transport options like feeder buses are excluded from growth and limiting passengers of options.
We firmly believe all taxis and private cars are a core driver and beneficiary of the overall growth of public transport. To begin with, all of Grab’s own efforts to strengthen last-mile connectivity will not discriminate between vehicle types. Moreover, we do not have any intention to seek exclusive arrangements with our government. Therefore, I humbly invite other fellow e-hailing networks, as well as taxi associations operating outside of e-hailing, to set aside our differences and contribute their own resources towards creating more affordable access for all Malaysians to our many bus and train stations. We believe no one should be denied the opportunity to contribute to the nation on their own accord.
Finally, we would like to note our government’s progressive stance thus far in striving towards a greater public transportation landscape, while providing income opportunities for Malaysians. While I do believe that there are some potential areas of improvement to help reduce the friction and burden of requirements on e-hailing drivers (especially part-time earners), I also believe the fair, balanced approach of our Ministry of Transport, Ministry of Finance and Prime Minister’s Department have given hundreds of thousands of hardworking Malaysians the confidence to continue earning an honest, respectable income, and is appreciated by the millions who rely on e-hailing to move around. We, too, have many areas to improve upon ourselves. But we are proud and remain committed to continue pushing towards a balanced, inclusive growth and progress for our nation.
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