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Originally posted by weehu:CDG low rental scheme are just to mislead the drivers. Why can't they make things simple by telling drivers that every CJ completed, rental will be lower by $1/per day.
Grab launches GrabCoach for group travellers http://str.sg/4shN
Whether one thinks it has been for the better or for the worse, the entry of ride-sharing services such as Uber and Grab into Singapore’s on-demand, private-hire passenger transport market has been a tremendous disruption. With more than 5 per cent of their fleets idle, taxi companies are scrambling to adapt their business models to attract driver-hirers and passengers.
Idle taxis incur heavy fixed costs in parking, maintenance and depreciation. According to some estimates, each unrented taxi requires about seven rented ones to cover the cost, which means that, on average, 40 per cent of the taxi fleet in Singapore contributes no profit to the taxi companies’ bottom lines.
Change will be welcomed by many drivers and passengers. For years, the taxi industry has displayed many oligopolistic traits. Taxi fares were deregulated in 1998 by the Ministry of Transport, and the market was further liberalised in 2003 to encourage new companies to inject much needed competition. However, the market has been dominated by ComfortDelGro (operating under the Comfort and CityCab brands), which as of December 2016 had a combined fleet of 16,821 taxis, or almost two-thirds of the 27,534 total. As a result of ComfortDelGro’s dominance and despite the deregulated nature of the market, both taxi fares and the daily rental rates of other taxi companies have tended to mirror that of the market leader.
Another oligopolistic trait of the taxi market in Singapore was the insensitivity of commuter demand to changes in fare price. Time-based surcharges were implemented to induce more drivers onto the roads, and were not thought to reduce travel demand in any significant way. Given the astronomical cost of owning a car in Singapore and the dearth of public transport options after midnight, post-midnight travellers had few options but to rely on taxis whatever the surcharge. Those who needed to travel during peak hours similarly had to bear with paying surcharges. Peculiarly, there are more hours with surcharges than without, making the concept of a ‘‘base fare’’ counterintuitive.
The equilibrium in Singapore’s taxi market has been upset by the entry of Uber and Grab, with their novel use of technology to match drivers to passengers.
By law, private rental cars in Singapore are not allowed to pick up street hails, and are allowed to accept only pre-arranged bookings. However, the ubiquity of the smartphone has compressed the time needed between requesting a car and having that request matched to a driver. This compression has narrowed the practical difference between a street hail and a booking, and has enabled private rental cars to compete effectively with taxis. These new ride-sharing services also offer additional advantages to passengers such as cashless payment modes, electronic receipts, the ability to rate drivers and automatic car-pooling for cheaper rides.
For the drivers, the inability to pick up street hails using rental cars is made up for by significantly cheaper rentals, and the added flexibility of using the vehicles for personal travel, including to destinations outside Singapore. Drivers also receive incentives for operating during peak hours or for hitting trip targets, adding to their income.
Going by the rising number of idle taxis, and the explosion in the number of rental cars in Singapore from 18,847 in 2014 to 51,336 in 2016, it is clear that many drivers and commuters find the proposition offered by ride-sharing companies compelling.
Most tellingly, some taxi drivers now complain that fare surcharges are reducing travel demand rather than enhancing driver income, which indicates that the taxi companies’ oligopoly on the private-hire transport market has been broken.
Long used to making incremental changes, taxi companies are now forced to rapidly adapt their business models, especially to attract drivers for their idle vehicles. Trans-Cab has slashed the daily rentals on some models by as much as a third, SMRT has introduced hourly rentals, and ComfortDelGro has just launched a “flexi-rental” scheme that cuts rental in exchange for revenue sharing. This proliferation of business models shows that the taxi market has regained something that has been absent for a while: Real competition.
For passengers, this renewed competition between the taxi companies has yet to translate to cheaper fares or significantly better rides, and it will be interesting to observe if the taxi companies have an effective strategy to attract and retain more commuters.
Despite their disruptive impact, it is not yet obvious that either Uber or Grab will be able to survive in the long term in Singapore and elsewhere. Both companies have been furiously burning cash on passenger fare promotions and driver incentives that have been going on for many months.
Both companies hope to win the war of attrition in a winner-takes-all market. For them, rapid global expansion has also stretched their resources and tested their ability to defend many markets simultaneously.
Neither company publishes financial statements, but some estimates show that the average Uber passenger pays for only 41 per cent of the actual cost of a trip, and despite exiting the cut-throat Chinese market, Uber still lost more than US$800 million (S$1.13 billion) in the third quarter of 2016.
As for Grab, it recently announced that it would spend US$700 million in Indonesia alone over the next four years to implement its “Grab 4 Indonesia” 2020 master plan.
Having taught passengers to be price-sensitive, both companies are themselves vulnerable to other firms with even more financial muscle — for example, the Chinese ride-sharing companies.
In the end, it may turn out that the Singapore market is indeed too small to accommodate multiple ride-sharing services in addition to a number of taxi companies, especially if the incumbent firms figure out an effective counter-strategy.
Regardless of whether ride-sharing services survive in their current form here, one thing is for sure: Their impact on Singapore’s taxi market will be indelible.
ABOUT THE AUTHOR:
Hawyee Auyong is a Research Fellow at the Lee Kuan Yew School of Public Policy.
Private-hire operators such as Uber and Grab will have to ensure their drivers have proper licences and insurance, as well as display a prominent decal identifying the car they drive as a private-hire vehicle, under a law passed in Parliament yesterday.
They can be suspended for up to a month should their drivers be found to have flouted the rules three or more times in a year. They can also be fined up to $10,000 if they do not take steps to ensure their drivers are properly licensed.
But the stiff penalties are a "last resort", said Second Minister for Transport Ng Chee Meng, adding that the Registrar of Vehicles will not take such a step lightly as "a general suspension order has serious implications" not just for the operator, but also its drivers.
In short, it means the operator will not be able to serve commuters for up to a month as its drivers will be barred from driving for it.
Mr Ng stressed that the intent is to apply it in instances where the "operator repeatedly makes no attempt to ensure that its affiliated drivers adhere to our laws".
This major move is among several measures introduced in the Road Traffic (Amendment) Bill, which gives the Land Transport Authority (LTA) powers to regulate and take private-hire operators to task, among other things.
The rules were welcomed by MPs, who said these would help level the playing field between private-hire companies and taxi operators. In presenting the Bill for debate, Mr Ng said the measures "are necessary for the interests of commuters".
The penalties dovetail with new regulations that will be imposed on the private-hire car industry by the first half of this year. Under these regulations, private-hire drivers will be required to undergo a vocational licensing course plus background screening and a medical check.
Cars being used for services such as those provided by Uber and Grab must also be registered with the LTA, and display decals identifying them as private-hire vehicles.
Mr Ang Hin Kee (Ang Mo Kio GRC), who is an adviser to the National Taxi Association, suggested that the Government go further and collect licensing fees from private-hire operators, just like it does with taxi operators.
Cab companies pay a licensing fee of 0.2 per cent of the gross revenue collected.
Mr Ang added that the fees collected from the private-hire operators would allow the LTA to recover the costs incurred from monitoring these new players.
But, Mr Ng said, the Government is not planning to license private- hire services for now.
"This light-touch approach allows the industry, which is still evolving, to continue to innovate and benefit commuters," he added.
Mr Melvin Yong (Tanjong Pagar GRC) asked if the Government plans to expand the new rules to regulate car-pooling services such as GrabHitch.
"A similar vocational licence for ride-share drivers, with mandatory background checks, would serve to enhance the safety of our commuters," he said.
Mr Ng said that the Government does not intend to do so, as these services differ from private-hire car services in that they are not for profit.
Drivers who carpool can collect only a small fee to help them recover their costs, he added.
The new law includes rules that will govern autonomous vehicles such as driverless cars, and allow the Government to prohibit foreign-registered vehicles from entering and leaving Singapore if they have unpaid fines and taxes.
why there are no mention about age and status (citizen/pr) in the ruling of PHV? anyone can enlighten me ?
thank you!
news: public are more satisfy with uber and grab than taxi
Commuters more satisfied with Uber, Grab than taxis: Public Transport Council survey http://str.sg/4eUp
The market for taxi and taxi-like services has doubled since private-hire car services Uber and Grab began operating here in 2013.
Transport Minister Khaw Boon Wan said these private-hire services have now claimed about half the market for point-to-point transportation services.
This comes as the total number of taxi trips has remained relatively stable.
Ang Mo Kio GRC MP Gan Thiam Poh had asked if the Transport Ministry would control the private-hire car population.
He cited concerns that the expansion of private-hire services could drive up Certificate of Entitlement premiums.
Mr Khaw replied that his ministry will leave the growth of private-hire cars to market forces and monitor the situation. - THE STRAITS TIMES
Some taxi fares could soon fluctuate according to actual demand for cabs.
Two taxi operators are planning to implement dynamic fares, popularly known as surge pricing, with a third looking to join the fray.
Trans-Cab, Singapore's second largest operator with 4,566 taxis, and Premier Taxi, the second smallest with 1,889 cabs, said they had informed the Public Transport Council (PTC) of their plans.
Prime, the smallest operator with 731 cabs, is considering implementing the controversial fare system too.
Though taxi fares are not regulated here, operators are required to keep the PTC posted of all changes before they are implemented. The operators are awaiting the PTC's response.
The new fares will apply only to commuters hailing a cab via the Grab ride-hailing app.
ComfortDelGro and SMRT Taxis have not indicated that they want to join the initiative.
Dynamic fares vary according to real-time demand - lower than the current structured taxi fares during off-peak hours but possibly much costlier when demand surges.
During major rail breakdowns, commuters complained of Uber fares exceeding $140 - four to five times that of a usual taxi fare.
But supporters of dynamic fares point out that in cases of high demand, the supply of taxis under the current pricing plan is inadequate.
Premier Taxi managing director, Mr Lim Chong Boo, said: "During the peak, there would not be enough taxis even if we doubled the fleet."
He said dynamic pricing "is a Grab initiative, and as a business partner, we are supporting it".
The new format will give commuters another alternative to secure a cab, he added.
"It'll also allow taxi drivers some levelling of the playing field," said Mr Lim, referring to cabbies complaining they are losing business to private-hire drivers due to the rigid fare surcharge system taxis must adhere to.
Trans-Cab managing director, Mr Teo Kiang Ang, said he was keen to roll out dynamic pricing, "but the PTC asked us to hold on".
Asked why the council's approval had to be sought since taxi fares have been deregulated since 1998, a PTC spokesman would only say: "PTC and Land Transport Authority will jointly review the applications."
Observers reckon the Government is waiting for market leader ComfortDelGro - which controls more than 60 per cent of taxis here - to make a move before making a decision.
Two weeks ago, ComfortDelGro's chief executive of taxi business, Mr Yang Ban Seng, said: "We would love to do surge pricing, but I don't think we are allowed to."
Assistant Professor Yang Nan of the National University of Singapore Business School's strategy and policy department said taxi firms may actually lose some competitive advantage as "people prefer conventional cabs because there is more certainty in their fares".
"If everything is too similar, it will boil down to price competition. And the taxi companies do not have the advantage of these other players," he said, adding that the latter "have deep pockets and money to burn, and they can press down fares".
SIM University economist Walter Theseira said: "On the one hand, it is a good idea to have better responsiveness. But the risk is it will be next to impossible to get a street hail.
"This may be a transitional concern though. If people move entirely over to getting a taxi via an app, then it won't be a concern any more."
Grab would not comment when contacted yesterday.
saw many grab cars and ubers entering taxi stand at mrt stations
taxi stand and pickup points different
pickup points sometimes in front or behind taxi stands
and dont just assume all pte cars are uber/grab
they might be just wives picking up their husbands