Grab and Uber have come under fire due to fare cuts, with executive adviser Ang Hin Kee of the National Taxi Association (NTA) expressing his concerns that such a move would hurt a multitude of groups, including GrabCar and UberX drivers, the taxi industry and commuters.
Earlier this month, both Grab and Uber cut fares for their private chauffeur service GrabCar and UberX by 14 and 15 percent respectively. This move has made private car fares significantly lower that tradition taxi fares. Previously, fares for both taxis and private cars were sill comparable.
Mr Ang, who is also a Member of Parliament at Ang Mo Kio GRC, stated that this fare reduction would hit private car drivers themselves as even with the reduction, both app companies were still taking a 20 per cent cut from their drivers.
He also expressed his concern that the move would create an unfair playing field for the taxi industry. While competition is welcome, he noted that taxi companies have various “compliance costs” to cover while private car apps do not have to do so. For instance, taxi companies must ensure that their cab drivers meet certain standards set by the Land Transport Authority by driving at least 250 km a day and driving during peak hours.
Finally, Mr Ang also predicted that the average commuter would ultimately be hurt by GrabCar and UberX fare reductions. Should such private car apps dominate the market in the future, they would then have the power to raise prices and charge commuters a premium. “When they have the market share later on, they could exercise the right to earn profits,” said Mr Ang.
However, despite the insistences that the taxi industry would be harshly hit, taxi drivers themselves do not seem to share the same sentiments.
Last year, in response to The Straits Times’ article “Cabbies cry foul over rival drivers”, Comfort taxi driver James Lim took to his blog where he stated that he was “flabbergasted” by the article. (read Mr Lim’s blog here)
He noted that third party booking apps also allowed taxi drivers to do more booking jobs in addition to street flag down jobs that private car drivers are unable to do. Private car drivers also ensured that commuters’ demand for drivers during peak hours was met, as Mr Lim felt that taxis alone were unable to fully cope with the demand.
Finally, he stated that “if you can’t beat them, join them,” and noted that cab drivers had the option to “easily defect to Uber” should it make sense to do so economically.
Mr Lim also added that Mr Ang’s criticism of the growing private car for hire industry “cannot be depictive of Singaporean cabbies in general,” and that the 2015 Straits Times article mainly offered the opinions of only Mr Ang. Mr Lim pointed out that while Mr Ang serves as an adviser of the NTA and as MP, he is not a cabbie.
Similarly to the reaction to his comments last year, Mr Ang’s recent criticism of the fare cuts were generally not echoed by taxi drivers nor commuters.
Numerous netizens responded to Mr Ang’s recent comments, with most, as regular commuters, supporting the fare cuts, stating that GrabCar and UberX injected much-needed competition to a market previously dominated by the taxi industry.