Indonesian ride-hailing major Gojek has confirmed the acquisition of a minority stake in the country’s largest taxi operator, Blue Bird, for 411 billion rupiah ($29.8 million), marking the startup’s foray into the conventional transportation game.
Gojek bought 108 million shares, or around 4.3 per cent, of the taxi operator for 3,800 rupiah per share.
The move strengthens an existing partnership between the two companies, which has seen Gojek adding Blue Bird taxis as one of the transportation options on its app.
“The increase in collaboration with Blue Bird … allows us to improve our two main services in Indonesia — namely, payment and transportation,” Andre Soelistyo, co-CEO of Gojek, said in a statement.
Following the deal, Blue Bird passengers will be able to pay for their rides by scanning QR codes using GoPay, Gojek’s payment system. The taxi operator will also add the GoPay payment option to its own app.
With a fleet of around 23,000 taxis, Blue Bird will provide GoPay with significant additional use case as it continues to fight a stiff battle with payments rival OVO, backed by Gojek’s ride-hailing nemesis Grab.
On the transportation front, its minority ownership in Blue Bird officially brings Gojek into an arena where Grab had first entered about a year earlier. In the second half of last year, Grab quietly launched GreenLine Taxi, a conventional taxi equipped with Grab technology.
As with other conventional taxi services, Greenline can be hailed by a passenger on the street or ordered online.
Conventional taxis were predicted to be disrupted by online ride-hailers offering better technology and cheaper prices. However, despite the arrival of Gojek and Grab, Blue Bird and its peers remain the preferred choice for many users due to their perceived safety and reliability.
Expanding into the conventional taxi space was a natural step for Grab and Gojek to offer more choices to users. The move became a no-brainer in the last year after the pricing gap between online and conventional taxis was further narrowed down as the government imposed upper and lower tariff limits per kilometres on online taxis.
Interestingly, the Blue Bird partnership will also give Gojek access to electric vehicles, something rival Grab has only started to pilot through partnerships with automakers and distributors, including Hyundai, Astra Honda Motor and Gesits.
In October last year, Blue Bird introduced 25 Chinese-made BYD e6 all-electric compact multi-purpose vehicles, which will operate as regular Blue Bird taxis, and five Tesla Model X 75D mid-size all-electric luxury sport utility vehicles for its upmarket Silver Bird service.
At the launch of the vehicles, Blue Bird says it plans to increase its electric vehicle fleet to 200 by 2020.