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Tag: grab

  • Kakao’s carpooling app goes live in beta test

    Kakao’s carpooling app goes live in beta test

    Kakao’s carpooling service was introduced Friday for beta testing and will be officially rolled out Dec. 17. The start of the service comes after months of battling fierce opposition from local taxi services. They staged a strike on Oct. 18, two days after the IT company started accepting applications from carpool drivers.

    With the beta service, the Kakao T mobile app, a platform for all of Kakao’s mobility services from taxi hailing to navigation, was upgraded to enable the “Carpool” button on its main screen. The beta service will not be accessible to everybody.

    “The beta service is aimed at increasing the stability of the technology and collecting opinions,” Kakao said in a statement. “For that reason, it will only be offered to some users.”

    The selection of testers will be random and independent of age and location. Anyone upgrading the Kakao T app Friday will see the new “Carpool” button, but only the selected users will be able to input words in the destination box. Those who weren’t selected will see an image with the words “This service will launch soon.”

    The base fare is set at 3,000 won ($2.68) for the first 2 kilometers (1.24 miles), the same as for regular taxis. After that point, the fare will increase proportional to the driving time and distance. The company did not disclose details, but a spokesman said the cost will be equivalent to around 70 to 80 percent of regular taxi fares.

    Kakao’s carpool drivers are allowed to offer carpooling services twice a day at any time of the day. The twice-a-day rule is due to the domestic law that limits carpooling to commuting purposes. More than 50,000 drivers who met Kakao’s requirements have been selected so far.

    A government-led task force composed of lawmakers from the ruling Democratic Party, public officials and taxi companies met Friday to discuss carpooling. Executives from Kakao Mobility, the affiliate in charge of the IT company’s transportation services, decided to launch the same day,

    Kakao acquired the Luxi carpooling app in February and completed preparations for its service later in the year.

    The official launch was postponed previously as the task force failed to reach an agreement on the service’s details, including the fare and limits on use. During a task force meeting held Thursday, some government officials opposed Kakao’s request to release the service that same day, demanding more time to find common ground.

    Korea has been a difficult place for carpooling. Uber closed down its service in 2014, and Seoul’s local government questioned the legality of carpooling app Poolus in 2017.

  • Indonesia’s Go-Jek Starts Trial Launch in Singapore, Challenges Grab

    Indonesia’s Go-Jek Starts Trial Launch in Singapore, Challenges Grab

    Indonesian ride-hailing firm Go-Jek kicked off a trial launch in parts of Singapore on Thursday and plans to roll out an array of services through its app in early 2019, challenging dominant player Grab in the small city-state. Both Go-Jek and Grab are raising billions of dollars and investing aggressively in the race to corner a bigger share of Southeast Asia, as more of the region’s 640 million consumers go online and use smartphones to shop, commute and make payments.

    Go-Jek, backed by the likes of Tencent Holdings, Alphabet Inc’s Google and Singapore state investor Temasek Holdings, is initially launching ride-hailing service in parts of Singapore after forming a partnership with DBS Group Holdings, the region’s biggest bank.

    “As this is a new product, we will obviously give promotions, but at the end of the day, it shouldn’t only be pricing that differentiates our services,” Go-Jek’s president, Andre Soelistyo said on Thursday.

    Grab, backed by Japan’s SoftBank and Chinese ride-hailing firm Didi Chuxing, bought Uber Technologies’ loss-making Southeast Asian business this year, marking the first big consolidation in the region.

    Following this, Singapore’s anti-trust watchdog slapped Grab and Uber with fines and imposed measures to open up the local market to competitors after concluding that their merger had driven up prices.

    Go-Jek’s executives declined to give any details on how many drivers it had signed up or a target for market share in Singapore but said payment services would be launched later.

    Started in 2011 in Jakarta, Go-Jek has evolved from a ride-hailing service to a one-stop app through which its customers can make online payments and order everything from food, groceries to massages.

  • Rivalry heats up in Vietnam’s food delivery market

    Rivalry heats up in Vietnam’s food delivery market

    Last week, a sea of red filled the inside of a milk tea shop in Ho Chi Minh City instead of regular young customers usually found in such places. GoViet drivers were queuing up to purchase food ordered by customers over its online delivery app Go Food, which was running a 50-percent discount program along with free delivery within 5 kilometers.

    The very next morning, the shop was filled with green shirts of Grab drivers. Grab had launched a free delivery promotion for the first 999 cups of milk tea ordered.

    Gradually, the green shirt – red shirt war is becoming visible on the streets.

    Despite being new entrants in the online food delivery market, both Go Viet and Grab are using various measures to attract and capture customer habits. Everyday, these two tech companies spend big on promotions across a wide range of food and drinks.

    They are also recruiting stars from the entertainment industry to endorse their service.

    From the get go, Go Viet had announced a partnership with singer Son Tung M-TP, who broke the record of Asia’s most viewed music video in 24 hours last May, as the company’s brand ambassador.

    Similarly, Grab’s start-studded ads feature diva My Tam, goalkeeper Bui Tien Dung and striker Nguyen Quang Hai of the national football team.

    While having large financial and technological capabilities, both Grab and Go Viet face many challenges after entering the market later than competitors like Delivery Now by Foody, Vietnammm, and Lala, which are apps well known to many customers.

    Delivery Now offers a wider range of food on its menu than Grab and Go Viet, had has a dense network of partners from large restaurants to small pavement stalls, industry insiders say.

    Delivery Now is a product of Foody Corporation, a Vietnamese food service startup that was acquired by Singapore-based internet firm Sea LTD last year; Vietnammm.com is a subsidiary of Takeaway.com, one of the world’s largest online food ordering websites based in the Netherlands; and Lala is invested by Ho Chi Minh City-based Scommerce Group, an information technology and services firm.

    Many experts believe that the race for market share between Go Viet and Grab will resemble that of Grab and Uber when they first entered Vietnam.

    Both Grab and Go Viet are aspiring to become super apps, for which food delivery is an indispensable keystone. In addition to attracting users with incentives and advertising, the two companies are spending a lot of money on reward policies to incentive drivers and expand their network of partner restaurants.

    Grab Vietnam CEO Jerry Lim claimed GrabFood’s growth has been very impressive, with the number of its contractors increasing eight-fold in just a month of testing in Hanoi. GrabFood was released in the city early last month, after a period of testing.

    In Vietnam, Grab is reaching delivery speeds of under 25 minutes and aims for a further reduction to 20 minutes per order, the fastest in regional markets.

    Grab Food is available in both Hanoi and Ho Chi Minh City, while Go Food is only present in the latter.

    Go Viet, however, remains confident that it will meet the needs of customers, aiming to partner up with thousands more restaurants nationwide in casual dining, fast food or luxury dining.

    “Food delivery and e-wallets are promising market segments,” GO Viet CEO Nguyen Vu Duc said after a few months of competing against Grab.

    However, these delivery apps also have certain limitations. For some items on their menu, drivers have to pay up front when ordering for customers in non-partner restaurants.

    Not all drivers are happy to buy food this way as waiting is time consuming, they have to make advance payments and risk the customer not accepting delivery.

    Do Xuan Quang, deputy head of Vietnam Logistics Business Association, said Vietnam was the fastest growing e-commerce market in Southeast Asia, and along with the strong growth of the logistics industry at 15-20 percent, a similar movement in the delivery market was not surprising.

    In 5-10 years, the delivery market in Vietnam will be valued at around $10 billion, he said.

    U.K.-based market research firm EuroMonitor International values the food delivery market in Vietnam at around $33 million this year and at more than $38 million in 2020. It also puts the annual growth rate of the market at 11 percent.

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  • ‘In startup world, being seen as crazy is normal’: Grab co-founder

    ‘In startup world, being seen as crazy is normal’: Grab co-founder

    Startup entrepreneurs need passion and should take risks and make sacrifices to succeed, says Tan Hooi Ling, co-founder of Grab. She said passion and commitment, not money making, should drive a startup, and that it was okay to be considered crazy. The co-founder of Grab was speaking at the closing ceremony of the 2018 Startup Vietnam contest in Ho Chi Minh City on November 15,

    She traced Grab’s journey to becoming one of the major ride-sharing services in the world. It all started seven years ago when she and co-founder Anthony Tan spoke about deploying a mobile call service. But no one could imagine what the application would be like and some even called the idea crazy.

    The skepticism and protestations did not dissuade the Grab team, which continued to plow ahead on its difficult journey.”When we shared our idea, they raised their eyebrows and asked, ‘What? What exactly do you want to do? How does this work?’”

    One of the big difficulties she and her colleagues faced frequently was finding partners and building a team with a vision and belief in the future of the startup.

    “At first, not many people understood our model, so we had to look around the world for engineers, scientists.”

    Grab is now present in 235 cities in eight Southeast Asian countries. Its application has been downloaded 125 million times, meaning every fourth smartphone user is a Grab user. Its annual revenue now tops a billion dollars.

    “It was the result of a grueling seven-year journey where we tried, failed, and stood up again so many times. This is an experience most startups would encounter.”

    A new idea could be considered crazy today, but make a tremendous impact on the world tomorrow; that is the key to innovation, Tan Hooi Ling said.

    She said another lesson to be learned from Grab is to know how to stop and ask questions whenever there is trouble or a stumble, instead of continuing with the same strategy.

    After each spill, the startup needs to calmly reflect on what has happened, why the failure, what is not going in the right direction, and how to change, she said.

    After drawing lessons, the entrepreneurs must pull themselves up and continue with their journey, she said. But that perseverance should be accompanied by a passion and the courage to take risks and sacrifice time, effort, money, and energy to realize the dream.

    “Do not start a business just because you want to make more money or you will lose a lot before seeing the light. Do it when and only when your heart races every day and when you think you have to achieve it completely and at any cost.”

    “If someone says you are crazy, let it go and move on. In startup world, being seen as crazy is normal.”

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  • Hyundai, Kia invest big in Grab

    Hyundai, Kia invest big in Grab

    Hyundai Motor and Kia Motors will jointly invest $250 million into the world’s third-largest ride-hailing operator Grab, eyeing shared mobility services as a way to overcome faltering car sales, the companies said Wednesday.  Hyundai has already injected $25 million into Grab in January, so total investment on the Singapore-based company adds up to $275 million. This is the largest investment made in a single company by the two sister automakers under Hyundai Motor Group, the group said.

    Grab, which has operations in 235 cities in eight countries in Southeast Asia, is the largest ride-hailing service provider in the region, though it is smaller than China’s Didi Chuxing and U.S. company Uber, which have larger operations elsewhere.

    The big bet in Grab comes as the largest auto group in Korea seeks fresh business models for growth. The group said it will make the two carmakers core players in an era where shared mobility is becoming ever more important.

    The three companies will start their collaboration by deploying Hyundai and Kia-made electric cars in Grab’s Singapore business. Hyundai will first supply 200 electric vehicles to the ride-hailing company by early next year. Kia is mulling whether to follow suit soon after.

    The vehicles will be rented out to Grab drivers. This way, Hyundai can introduce its electric cars to Singapore and other Southeast Asian markets once the pilot test in Singapore proves successful.

    “Targeting emerging markets based on strong partnerships with local companies like Grab could be a sustainable way of making profits,” Hyundai said in statement.

    If more people use ride-sharing services and other apps rather than driving their own cars, these large mobility service companies could become the major customers for carmakers in the future, and automakers are already aware of this.

    The three companies will also work on developing car maintenance and repair services as well as car financing services specialized for Grab drivers using the electric cars.

    Going further, they plan to launch electric car models customized for ride-hailing services.

    “Grab is the best partner there is to expand [our] electric car supplies in the Southeast Asian market,” said Chi Young-cho, chief innovation officer at Hyundai Motor Group.

    The latest investment is in line with Hyundai’s aggressive preparation to enter the shared mobility business. It is a relatively late mover into the future mobility business compared to competitors like Germany’s Daimler, which launched its own car-sharing brand Car2Go in 2008.

    The automaker landed a partnership with Sydney-based car sharing start-up Car Next Door with the aim of launching a new app-based mobility service in Australia by 2020. It also holds partnerships with India-based car-sharing company Revv, U.S. mobility service company Migo as well as local last-mile delivery service provider Mesh Korea. In Netherlands, it started its own car-sharing business with 100 Ioniq EVs last month.

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  • Grab: becoming a taxi company a step back from Industry 4.0

    Grab: becoming a taxi company a step back from Industry 4.0

    Ride-hailing firm Grab says giving in to traditional taxi companies’ demands is akin to bowing before “angry workers threatening to smash machinery.” Grab has written to Prime Minister Nguyen Xuan Phuc expressing concern over the latest draft of a decree prepared by the Ministry of Transport under which transport firms offering services with under 9-seater cars should be registered as taxi firms before they can apply ride-hailing technologies.

    This means that Grab and other ride-hailing firms would have to register their services again as taxi businesses and comply with corresponding legal responsibilities regarding their operating licenses, drivers’ profiles and tax duties.

    “The regulation not only goes against the policy and guidelines of the Government on the application of science and technology, and on reform of administrative procedures, but also completely denies the clear benefits achieved by the pilot scheme for ride-hailing services,” the company said.

    It said that the pilot scheme has sped up development of the transportation market, helped state agencies find effective management solutions using technology, and inspired the advance of Industry 4.0 in Vietnam.

    The company is providing an essential service to 20 percent of Vietnam’s population every day, providing work for 175,000 drivers and has contributed VND270 billion ($11.5 million) to the state exchequer in taxes in the first 9 months of this year.

    It said many taxi companies have “awakened” to the revolution and are currently cooperating very well with it, as well as other ride-haling firms.

    However, there remain “traditional taxi businesses who fear innovation, losing market dominance, and competition,” the company said.

    Bad precedent

    Grab said that this (treating ride-hailing firms as taxi firms) would set a bad precedent for the whole legal system and send discouraging signals to the start-up environment in Vietnam.

    “We have to emphasize that the approval of this draft, to appease the subjective will of some traditional taxi companies, would be to oppose the benefits and advances so important to society and the economy. This will be a step backwards from Industry 4.0, to bow before ‘angry workers threatening to smash machinery,” wrote Lim Yen Hock, CEO of Grab Co. Ltd.

    On Wednesday, a standing working group of the Government announced the results of the review of the draft submitted by the Ministry of Transport, saying that based on road traffic law, transport vehicles using ride-hailing technology like Grab or Uber are in essence taxis.

    These vehicles have to be subject to regulations as taxis, and cannot be classified as ‘electronic contract-based vehicles’ to circumvent the law, evade tax, avoid costs and receive incentives that do not apply to traditional taxis, the working group said.

    The debate over Grab’s status as transportation company is not new in Vietnam.

    Vietnam’s top taxi company Vinasun has sued Grab for $1.84 million in losses, citing “unhealthy competition.”

    The ride-hailing market in Vietnam has seen new entrants after the departure of Uber, which sold its Southeast Asia operations to Grab. The newcomers include Fastgo and GoViet, the last mentioned being an affiliate of Indonesia’s Gojek.

    Current market dominator Grab has expanded its services to include GrabFood, a food delivery service, and GrabCar Business, targeting the corporate sector.

    These moves pose further challenges for long-standing taxi firms like Mai Linh, Taxi Group and Vinasun.

  • Vietnamese taxi firm to get support in lawsuit against Grab

    Vietnamese taxi firm to get support in lawsuit against Grab

    Prosecutors have argued in a trial in HCMC that Grab must pay Vinasun compensation for losses it caused through “unhealthy competition.” At a hearing Tuesday the city People’s Procuracy rejected ride-hailing firm Grab’s argument that the court had no jurisdiction over the case, saying it does since it is a commercial dispute.

    Prosecutors also asked the judges to deny Grab’s request to summon representatives of Vietnam’s Ministry of Transport, other companies participating in the ministry’s pilot scheme for ride-hailing services and the company responsible for estimating Vinasun’s losses.

    As for Grab’s claim it is a tech firm and not a taxi company, they said since the firm directly assigns drivers, sets fares, sets regulations for drivers, and offers promotions, there is enough reason to dismiss this too.

    “Vinasun’s demand for compensation for reduced profits is well founded since Grab was dishonest in its business declaration and ran promotions in contravention of regulations, causing over 70 percent of Vinasun’s customers to switch to Grab due to lower fares.”

    Vinasun’s after-tax profit was nearly VND320 billion ($13.7 million) in 2015 and VND295 billion ($12.63 million) in 2016, but dropped to VND53 billion ($2.27 million) in the first half of 2017, by which time over 8,000 drivers had quit and hundreds of cars had stopped running due to a lack of drivers.

    Prosecutors asked the court to accept Vinasun’s petition for compensation of VND42 billion (nearly $1.8 million) in one payment.

    Grab continued to insist the case did not come under the court’s jurisdiction and that it is a tech firm.

    Dismissing the claim it had caused losses to Vinasun, Grab cited market research purporting Vinasun has been losing customers due to other reasons such as driver’s attitude, long waiting time and declining car quality.

    Vinasun filed the suit against Grab at the HCMC People’s Court in June last year accusing the Malaysia-based firm of abusing the Ministry of Transport’s pilot scheme and committing violations.

    Claiming Grab’s illegal activities had caused damages to it, Vinasun claimed to have suffered losses of nearly VND76 billion ($3.25 million) in 2016 and the first half of 2017, of which nearly VND42 billion (nearly $1.8 million) was caused by Grab.

    The trial began last February, but was first adjourned a month later due to the need for more evidence and again last month when Grab protested against the evaluation of Vinasun’s losses and refused to attend.

    The court is scheduled to hand down its verdict next Monday.

  • FastGo drives into provincial markets in Vietnam

    Vietnamese ride-hailing app FastGo has expanded its services to provinces in Vietnam like Dong Nai and Binh Duong, provinces neighboring HCMC. FastGo aims to cater to high travel demand within the southern provinces and for commutes between the provinces and Ho Chi Minh City

    Nguyen Huu Tuat, general director of FastGo Vietnam, said that Bien Hoa City in Dong Nai and Binh Duong were two municipalities next to HCM City with large traffic flows and number of commuters.

    The introduction of the app in these localities will make it more convenient for customers to travel, as well as reduce wasteful ‘empty miles’ for local cabs, he added.

    Currently, FastGo has about 1,000 drivers operating in these two cities.

    The company plans to expand its presence into Ha Long City in the north and Nha Trang City in the center early next month. By the end of the year, it will also introduce food delivery and “On Demand Shopping” services.

    Launched in June 2018, FastGo now operates in Hanoi, Ho Chi Minh City and Da Nang with more than 30,000 drivers. It has already completed “over one million kilometres of service.”

    At the end of August, the company received funding from VinaCapital, and is planning to mobilize up to $50 million for a second expansion phase that will target Indonesia and Myanmar.

    FastGo has three core services: Fast Car – a four-wheel drive app for private contractors wanting to make additional income; Fast Taxi – a service linked with existing taxi companies who can receive orders on the app; and Fast Luxury – a semi-luxury car service.

    FastGo last month said it has 15,000 taxi and motorbike partner drivers in Hanoi and Ho Chi Minh City, but they are still not a common sight on the streets, unlike the ubiquitous red and green uniforms of Go-Viet and Grab drivers.

    Tuat said he wants FastGo to become one of Southeast Asia’s top 3 ride-hailing apps in the future.

    A report quoted the company as saying it hopes to make its service available in 20 cities in Vietnam and five other Southeast Asian markets, including the Philippines, Cambodia and Thailand, by the end of next year.

    FastGo Vietnam Joint Stock Company was established in April 2018 with its headquarters in Hanoi. The company belongs to a wide network of services provided by Nexttech – a leading tech firm in Vietnam.

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  • Aber ride-hailing service hits the road in Hanoi

    Aber ride-hailing service hits the road in Hanoi

    Aber, the second Vietnamese ride-hailing service, launched its Hanoi operations Friday, four months after making its HCMC debut. The ride-hailing market has seen new entrants after Uber’s departure, including Vietnamese firm FastGo, GoViet – a subsidiary of Indonesia’s Go-Jek, and the latest Aber. Aber estimates it will attract 5,000 taxi drivers and 5,000-10,000 motorbike drivers in Hanoi this year.

    In HCMC, the company is working with 7,000 drivers serving  more than 60,000 customers. Aber general director Huynh Le Phu Phong said the company was not afraid of major competitors such as Grab because it offers a wide variety of transport services.

    The firm will offer similar rates as other competitors, but give better benefits to its drivers, he said.

    “We do not force drivers to only work for Aber. They can also work for other companies to increase their income and improve their lives,” Phong said.

    In its latest update, Aber has added new features including a navigation system and accurate positioning to each alley, village, district and province in Vietnam.

    Vietnamese engineers designed the software.

    Next year, the company will focus on expanding its services, including Aber Express for delivery services, Aber Track for freight services, Aber Business for companies and Aber Travel for travel services, Phong said.

    Aber focuses on serving individual customers to help them save money, as well as drivers, when their vehicles are vacant, he added

    Instead of having to drop off items at the post office or delivery centers, drivers will come and pick things up right at the customer’s house.

    Current market dominator Grab has expanded its service to include GrabFood and GrabCar Business, the latter targeting the corporate sector. These moves pose further challenges for local long-standing taxi firms like Mai Linh, Taxi Group and Vinasun.

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  • Taxi or not? Vietnam debate rages over Grab status

    Taxi or not? Vietnam debate rages over Grab status

    Transport authorities and taxi associations have reiterated that ride-hailing firm Grab should be treated as a taxi service, but experts disagree. Nguyen Cong Hung, vice chairman of the Vietnam Automobile Transportation Association (VATA), said at a recent meeting that it was incorrect to identify Grab as an electronic contract service firm.

    Hung said that legal experts have affirmed that Grab and other ride-hailing services are taxi services, and ordering a car service via a phone call or a phone app are only superficially different modalities.

    While some people believe that calling Grab a taxi service will hinder the development of technology, Hung disagreed.

    “Identifying a car service as traditional taxi or technology taxi will guarantee authorities management power and fairness in terms of their responsibilities. Whichever service applies technology will have higher profits,” he added.

    Echoing Hung, chairman of the Ho Chi Minh City Taxi Association, Ta Long Hy, said that any service which sets transport fees collects money and spends a large amount of money on discounts is a transportation service, and not merely a software company.

    Hy said that all car services that are 9-seaters or lower are taxi services in nature. “The Ministry of Transport should not create an exclusive playing field for a service that is basically a taxi service.”

    He proposed that 9-seater or lower car services, whether Grab or traditional taxis, be identified by a mark on their license plates or a larger registration label on the car’s windshield.

    Earlier this month, the Transport Ministry released the latest draft of a transportation management decree under which under 9-seater car services be registered as taxi firms before they can apply ride-hailing technologies.

    This means that Grab and other ride-hailing firms would have to register their services again as a taxi business and comply with corresponding legal responsibilities regarding their operating licenses, drivers’ profiles and tax duties.

    Should the decree be passed, Grab and other ride-hailing cars will have to put a sticker labeled “taxi” on their windshields and carry a taxi legend on the top.

    The draft goes against many experts’ requests to treat ride-healing services as a new business model that is different from traditional taxi service.

    Nguyen Dinh Cung, director of the Central Institute of Economic Management (CIEM), had said earlier that firms that primarily used software cannot be called a transportation business.

    Cung said that the government should encourage new investment forms or business models with an open and fair environment in keeping with Industry 4.0 trends.

    Lawyer Truong Thanh Duc said that the Ministry of Transport has been making changes with recent drafts without having a consistent viewpoint.

    The fact the ministry wants to identify ride-hailing services as taxi firms is against the government’s policy of prioritizing technology development in the Fourth Industrial Revolution, he said.

    Marketing expert Do Hoa said that Grab and other ride-hailing services should be managed under a new law specifically written for technological services.

    Traditional regulations related to taxi firms are not appropriate for Grab, as it is not a transport company, he said.

    The heated debates and struggles between ride-hailing cars and traditional taxis have not cooled after the exit of Uber from the Southeast Asian market in March. Taxi firms have continued to complain about the unfair competition they are facing.

    They have also joined hands to fight the market onslaught of ride-hailing firms.

    Grab has consistently been denying that it is a taxi firm, saying it only provides technological solutions to transport services.

    The debate over Grab’s status as transport company is hardly new in Vietnam. Vietnam’s top taxi company Vinasun sued Grab for $1.84 million in losses, citing “unhealthy competition”.

    In Vietnam, local cab firms like Mai Linh and Vinasun have to pay value added tax (VAT) of 10 percent and corporate income tax of 20 percent, while Grab only have to pay some 3 percent.

    The ride-hailing market in Vietnam has seen new entrants after Uber’s departure, including Fastgo and GoViet, which is an affiliate of Indonesia’s Gojek.

    Current market dominator Grab has expanded its services to include GrabFood, a food delivery service, and GrabCar Business, targeting the corporate sector.

    These moves pose further challenges for long-standing taxi firms like Mai Linh, Taxi Group and Vinasun.

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  • Grab, Fave form strategic partnership to boost growth

    Grab, Fave form strategic partnership to boost growth

    Prominent O2O services Fave and Grab have announced a strategic partnership to accelerate growth for both platforms across the region.

    The partnership combines the strengths of Fave’s broad merchant network and FaveDeals platform with Grab’s large user base and growing ecosystem.

    Starting this week, Fave’s merchant sales team will onboard merchants for GrabFood and GrabPay in Singapore and Malaysia, aiming to further accelerate the growth of both firms’ respective food delivery and mobile wallet services in these countries. Later in October, Fave will expand its platform with GrabPay mobile wallet.

    Fave customers can already spend their GrabPay balance at restaurants and retailers in the Fave network and deals available on Fave. Users may spend their credits across multiple categories and receive discounts and cashback offers. As a result, Fave merchants will now be able to access Grab’s Asean-wide customer base of more than 110 million app downloads.

    The integration of the GrabPay wallet was done through GrabPlatform, a suite of APIs that enables partners to access components of Grab’s technology like logistics and payments. This is the first of its kind integration in a partner app for the Grab Platform.

    Grab Financial’s senior MD Reuben Lai said” “We’ve always believed that in order for the region to go cashless, we would need a collaborative approach and are happy we can now count Fave, one of the fastest growing O2O platform in Southeast Asia as a strategic partner. As the region’s leading fintech platform, we will increasingly offer integrations through GrabPlatform. This allows more local and global partners to tap into previously untapped consumers and grows the Grab ecosystem as an everyday app.”

    Founder of Fave Joel Neoh added: “This collaboration with Grab provides a valuable win-win situation for both merchants and consumers. By providing GrabPay wallet as a payment option on the Fave platform, our merchants will immediately benefit from additional customer traffic from the millions of people who use the Grab platform daily. For customers, we have just made life easier for paying at our Fave merchants by partnering with the leading mobile wallet in the region.”

    The two partners are exploring additional ways to collaborate and help small and medium-sized enterprises grow their business. Further collaborative efforts will be focused on integrating more services on both platforms.

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  • Grab secures e-money license in the Philippines

    Grab secures e-money license in the Philippines

    Ride-hailing company Grab is expanding its mobile wallet services in the Philippines following receipt of an e-money license from the Bangko Sentral ng Pilipinas (BSP).

    Statistics from the central bank revealed that more than 98% of transactions in the Philippines still happen in cash, whereas 86% of people remain unbanked. Cash handling and services also cost millions of pesos a year to the banking industry.

    Besides its existing payments functions for ordering rides, express delivery and peer-to-peer credit transfer, Grab will soon be able to order food, pay their bills and purchases from their favorite stores and restaurants.

    As with rides, new services may help customers earn points with its GrabRewards loyalty program, with offers from partners such as SM Cinema, Cebu Pacific flights, McDonalds or Globe prepaid.

    The GrabPay mobile wallet built into the Grab app is designed to offer a low-entry barrier to secure cashless payment options for both consumers and merchants.

    The first feature to be launched by Grab under the e-money license will be the option to top-up prepaid load from the Grab app. Users in the Philippines who wish to top up their prepaid load, can tap the ‘Load Now’ bar below the GrabPay mobile wallet bar alongside other features including send, request and top up wallet.

    After entering the phone number to be topped up, they can select their top-up product. The request is sent to the telco service provider and receipt provided.

  • Experts fear foreign rivals too strong for Vietnam ride-hailing firms

    Experts fear foreign rivals too strong for Vietnam ride-hailing firms

    Vietnamese ride-hailing services are struggling to compete with foreign firms Grab and Go-Viet due to a lack of resources.

    FastGo last month claimed to have 15,000 taxi and motorbike partner drivers in Hanoi and Ho Chi Minh City, but they are not a common sight on the streets unlike the ubiquitous red and green uniforms of Go-Viet and Grab drivers.

    VATO, which received funding of $100 million from local transportation firm Phuong Trang, is also having trouble expanding after launching in May, its CEO Tran Thanh Nam admitted to the media.

    Another competitor, Aber, run by a group of young Vietnamese based in Europe, had said August 10 it would “temporarily cease app operations for an upgrade.” It has not made a return so far.

    Bui Danh Lien, former chairman of the Hanoi Transport Association, said operators need to give drivers a steady income to keep them and at the same time offer customers plenty of discounts and cheap fares, and “this is a tough challenge.”

    Economist Do Hoa told local media that the ride-hailing market is “a race to spend money”, and those without deep pockets won’t be able to compete.

    Grab and Go-Viet are willing to charge their customers as low as VND1,000 (4.3 cents) for a ride, he pointed out.

    “Vietnamese ride services are not financially capable of sustaining such losses like the foreign companies.”

    Even major players like Grab and Uber report big losses in Vietnam. According to the General Department of Taxation, Grab, with a total registered capital of only VND20 billion ($881,000), has incurred losses of nearly VND1 trillion ($43.48 million) during its three years in Vietnam.

    But this cash burn strategy is how Grab and Uber are eating up traditional taxi firms’ market share. In 2014-15 they launched promotion after promotion, including free rides and discounts, to attract customers. They expanded their driver networks by offering subsidies and big rewards based on performance.

    Other options

    Though the lack of funding is a weakness of local ride-hailing firms, there are other ways for them to grow, Dr Nguyen Duc Thanh, head of the Vietnam Institute for Economic and Policy Research said.

    “Since the lack of resources is a disadvantage for Vietnamese ride-hailing apps, they should not enter the cash burn race.”

    Going head-to-head with bigger rivals is not the right strategy to follow, he said.

    “They can enter niche markets like delivery, car rentals and long-distance ride services. Instead of trying to divide market share in the beginning, newcomers should think of a long-term strategy to build a solid foundation.”

    Nguyen Manh Hung, former chairman of the Vietnam Automobile Transport Association, was quoted by Tuoi Tre newspaper as saying local firms are unable to compete with Grab and Go-Viet because they are divided.

    If they join hands they could compete, he said.

    Go-Viet, the Vietnamese operation of Indonesia’s Go-Jek, came early last month seeking a share of the market that Grab has been dominating after the departure of Uber.

    Go-Jek founder and chief executive Nadiem Makarim said Go-Viet has grabbed a 35 percent share of the motorbike ride-hailing market in HCMC within six weeks of its launch on August 1.

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  • Singapore fines Grab, Uber combined S$13m, moves to open up ride-hailing market

    Singapore fines Grab, Uber combined S$13m, moves to open up ride-hailing market

    Singapore slapped ride-hailing firms Grab and Uber with fines and finalised restrictions to open up the market to competitors after concluding that their merger in March has driven up prices.

    Uber Technologies Inc sold its Southeast Asian business to bigger regional rival Grab in March in exchange for a 27.5% stake in the Singapore-based firm.

    While the combined S$13 million (RM39.4 million) fine was small compared with the firms’ multi-billion dollar valuations, that and the other measures imposed by the Competition and Consumer Commission of Singapore today represent the strongest censure by a regulator since the deal was unveiled.

    The anti-trust watchdog said it would require that Grab drivers not be tied to Grab exclusively and that Grab’s exclusivity arrangements with any taxi fleets be removed.

    Uber will also be required to sell its car rental business to any rival that makes a reasonable offer and will not be allowed to sell those vehicles to Grab without the watchdog’s permission. The car rental business, Lion City, had a fleet of some 14,000 vehicles as of December.

    Fining Uber S$6.6 million and Grab S$6.4 million, the regulator said effective fares on Grab rose 10-15% after the deal, and that the firm now holds a Singapore market share of around 80%.

    Uber said it believed the decision was based on an “inappropriately narrow definition of the market” and would consider appealing.

    Grab said it completed the deal within its legal rights, and did not intentionally or negligently breach competition laws. It would abide by remedies set out by the regulator, it added.

    Indonesia’s Go-Jek, which plans to launch services in Singapore, said it welcomed the regulator’s steps. “We’re encouraged to see the measures being taken to level the playing field. “It will have a significant effect on our strategy and timeline.”

    Other new entrants to the market include Singapore-based Ryde.

    Grab said it had not raised fares since the deal and argued that all transport firms, including taxi operators, should be subjected to non-exclusivity curbs.

    Grab has also been told to maintain its premerger pricing algorithm and driver commission rates, which the regulator said would protects riders against excessive price surges, and drivers against increases in commissions that they pay to Grab.

    The watchdog said it would suspend the measures on an interim basis if a Grab rival was able to garner over 30% of total rides in the ride-hailing services market in a month. It would remove the measures if a rival attained 30% or more of total rides matched in the market for six consecutive months.

    Rival services include third-party apps for calling cabs and private vehicles as well as taxi-booking services such as those provided by taxi operator ComfortDelGro Corp Ltd.

    Uber and Grab have a month to appeal the Singapore regulator’s decision.

    The deal remains under anti-trust review in Vietnam, which has warned that it could be blocked if the firms’ combined market share in Vietnam exceeds 50%.

    Jerry Lim, Grab’s country head in Vietnam, said he believed the local regulator will consider the market’s unique competitive dynamics and regulatory landscape in its investigation.

    In the Philippines, where the deal has been approved, the competition watchdog has said it is monitoring Grab’s compliance with conditions intended to improve the quality of service, with any breaches possibly resulting in fines.

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  • Grab partners with Vietnamese firm for payment service

    Grab partners with Vietnamese firm for payment service

    Grab announced on Tuesday its partnership with Vietnam’s MOCA Technology and Service company (Moca) for a mobile payment service in Vietnam.

    The ride-hailing firm pushes to cement its position in the Southeast Asian country. Grab has made digital payments and financial services a significant part of its growth strategy in the region, where a chunk of the population remains unbanked, fuelling expectations of a boom in demand for such businesses.

    “This is a great step forward. I think the Moca team is great, their technology and solutions are great, and together with the combined expertise of our Grab team we can truly move Vietnam toward a cashless economy, ” Grab co-founder Tan Hooi Ling said on Tuesday.

    Grab, which counts Chinese ride-hailing firm Didi Chuxing and Japan’s SoftBank Group Corp among its backers, is the most prominent player in Vietnam after it pushed out Uber in a deal that saw the latter exiting Southeast Asia.

    “This strategic collaboration with Moca marks an important milestone for Grab in Vietnam as we seek to accelerate our growth in one of the fastest growing economies in Southeast Asia, ” said Nguyen Tuan Anh, head of Grab Financial Group Vietnam.

    The companies did not give further details of the partnership, but said they expect to launch their joint service in October.

    Moca was granted a license for payment services by the State Bank of Vietnam in 2016 and has a network of 11 local banks as partners for their service, said Tran Thanh Nam, co-founder and chief executive of Moca.

    Grab said it has 175, 000 drivers and bikers across the country. Rival Indonesia’s GoJek entered Vietnam last month in a bid to grasp a share of Vietnam’s fast-growing market, which also has several other local players.

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