New ride-hailing players emerge in Southeast Asia to take on Grab, Go-Jek

Bangkok, Thailand. Photo: Hanny Naibaho/Unsplash

When Grab announced its acquisition of rival Uber’s business in Southeast Asia in March, anti-trust watchdogs immediately raised concerns of a possible monopoly in the region’s ride-hailing sector.

Anti-competition agencies in the Philippines, Singapore, and Malaysia launched investigations to determine whether Uber’s decision to sell its market share in the region to Grab hinders competition. However, these concerns could be short-lived as transport regulators in the Philippines, Malaysia, Singapore, Indonesia, and Myanmar have issued licenses to new ride-hailing companies to operate in these countries.

In the Philippines, for instance, the Land Transportation Franchising and Regulatory Board (LTFRB) said it has accredited at least five new transport network companies (TNCs) — MiCab, Hirna, Hype, Go Lag, and Owto — to offer users alternatives to Grab.

“Commuters will be able to compare now the different prices that these TNCs have to offer – not only the prices but the services as well,” said LTFRB Board Member Aileen Lizada in a press conference.

Micab partners with taxi operators to allow drivers to fulfil trips booked through its app. The company is targeting 15,000 partner taxis this year, according to Leo Gellor, head of driver programs at Micab.

Hirna, meanwhile, will operate outside of Metro Manila. Founder Coco Mauricio told reporters that the company will strive to become the cheapest TNC from a passenger fare perspective and the lowest commission from a driver’s perspective.

Hype President Nicanor Escalante told reporters that consumers can start downloading its beta test app starting May 19. So far, the company has already received 30,000 applications from drivers who want to use its app.

Owto seeks to be different from Grab and the new entrants in the Philippines’ ride-hailing space by paying drivers for cancelled trips. It already has 3,750 driver applicants.

“By ensuring drivers that they will be paid for cancelled trips, they will be motivated to go and fulfil a request and wait for the rider without worrying of a possible cancellation,” said Owto Chief Operating Officer Paolo Liberated.

Another Filipino-owned ride-hailing firm, U-Hop, made headlines recently after raising an undisclosed amount of funding from boxing champion Floyd Mayweather Jr. Currently, U-Hop has 10,000 drivers working with it, making it the second largest transport network firm in the Philippines after Grab. However, only 1,000 of these drivers are currently active.

A Go Lag official told DEALSTREETASIA that the Filipino ride-hailing firm will have a family-oriented long-term relationship with drivers and operators and will offer competitive rates and long-term rewards to riders.

“We do hope that our partners will find value in what we offer and they stay with us. And also the main focus of our company is not on the competition but to give the best possible service to both drivers and passengers,” he said.

Go Lag will start accepting TNVS applicants on May 14 but said it has already received hundreds of inquiries through email.

“We intend to expand our services to other provinces as well. Our target number, of course, is the entire transport network vehicle service (TNVS) supply in the country. But our mid-term goal is 20,000 drivers,” the Go Lag official said.

In Singapore, Indian ride-hailing firm Jugnoo has entered the market, joining other companies eyeing the city after Uber’s exit. The company said it looks forward to filling the gap left by Uber in Singapore using its reverse bidding model that it says emphasizes price transparency.

“Our only motive is to be the niche player in the market and this could be a decent niche. Our goal is around 10 per cent market share and to be a sustainable company. However, it’s not going to be an easy ride for us as Grab already has the home base advantage,” Samar Singla, founder and CEO of Jugnoo said in an exclusive interaction with DEALSTREETASIA.

Singapore will be a test market for Jugnoo, Singla said. If the company proves to be a successful model in the Singaporean market, it will further expand in Scandinavian cities as well as in Oslo, Stockholm, and Copenhagen – especially in the markets that have big sharing economies.

Last month, Singapore-based Ryde Technologies also said it would launch an app offering a private-hire car service and charge drivers a commission rate of 10 percent.

“We’ve always been planning to enter into the private hire space to complete our mobility suite, but right now I think is also an opportune time, I think the market needs more competition and that’s where we can provide consumers and drivers with an alternative platform and way to get around,” said founder and CEO Terence Zhou in an interview with Channel News Asia.

In Indonesia, startup Anterin seeks to not only challenge Go-Jek and Grab through its ride-hailing service but will also collaborate with them through its marketplace platform, which will be open to other service providers.

Anterin uses a concept of city transport network marketplace. On its app, drivers can set their own fare, while users can select from a list of drivers, based on distance, tariff, type of vehicle and even gender.

In Myanmar, where competition for ride-hailing customers in Yangon intensified following the entry of Grab and Uber last year, three local firms – Oway, Hello Cabs, and Get Ride – are gunning for a share of the market.

Oway, a leading travel company in Myanmar and the operator of ride-hailing taxi Oway Ride, raised $14.7 million from institutional investors and private equity firms in April. In addition to Oway Ride, it secured the license to operate Mini Oway, the first app-based three-wheeler bike service in Mandalay, in November.

On the other hand, Hello Cabs, formed through a joint venture between Dagon Logistic Co Ltd and Yangon-based Strategic Development International Holdings Co Ltd (SDI), was the first to introduce app-based ride-hailing in Yangon in 2014, ahead of an official launch in August 2015.

Another new player, Get Ride backed by BOD Tech, is exploring the app-based bike (two-wheeler) market in Mandalay and Monywar in Sagaing Region. It will be up against Grab, which is also planning to enter the bike-sharing market of Mandalay.

But how should new, smaller players deal with the expected heated competition in the region’s ride-hailing space and disrupt Grab’s dominance? Jugnoo’s Singla said the focus must be on building a sustainable model that benefits both the drivers and the consumers.

In Singapore, he added, the market has created opportunities for the newcomers to enter the sector, following Grab’s acquisition of Uber. But Singla said Jugnoo is not a competitor in Singapore.

“Ours is a democratic model and we are not here to compete with anyone,” he said.

(With inputs from Ardi Wirdana in Indonesia and Juliet Shwe Gaung in Myanmar)

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