E-Hailing versus Taxi Drivers: An Endless Contention

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Mahathir reacts to the outburst by taxi drivers in Langkawi – courtesy of Sinar Harian

So, 10 Langkawi taxi drivers hurled abuses at the Prime Minister before walking out of the hall recently where they were to have a dialogue with the latter.

They were utterly dismayed at the government’s decision to allow E-hailing services, namely Grab, to continue its existence and complement the taxi services.

Their anger is understandable.  In March of last year, taxi drivers and owners staged a protest against the previous administration outside the Parliament building, for allowing Grab to operate, and were joined by the likes of Mahfuz Omar, Rafizi Ramli, while in 2015 Datin Seri Wan Azizah Ismail joined them at Padang Merbok.

Although the Prime Minister has denied ever wanting to abolish Grab and other E-Hailing services, the taxi drivers and owners feel as if the government has reneged on its promises to protect their interests.

Prior to the walk out last Sunday, there have been two rallies opposing Grab services organised by taxi drivers; one at Padang Merbok in July, and the latest was five days ago outside the Ministry of Finance.

Back in the 1960s and 1970s, you would either have to go to a taxi stand, or call up a taxi stand to have a taxi sent to your location, or wait for one to pass by.  With the advent of radio taxi services in the 1980s, getting a taxi was similar but quicker as the taxi could be roaming near your neighbourhood.

Not much has changed since, but with mobile phones, if you know the taxi driver personally, you could call him or her to come pick you up.

E-Hailing is not much different.  You have a car owner, registered with Grab for example, who would choose on the software whether he or she would like to pick up a passenger who has hailed for a ride using his or her mobile device.

A destination is given and the car owner drives the passenger to the given destination. The fare is fixed; so unlike with taxi drivers, you do not get the last-minute discussion for extra payments.

You can either opt for a credit/debit card payment, or pay by cash.

But E-Hailing is more attractive to the passengers.  Besides having the fare fixed, you don’t need to conduct a cash transaction, they can pick you up from anywhere and drop you off at your choice of destination at any time of the day or night.

With E-Hailing, more and more partygoers would be willing to not drive at night, thus increasing the size of the cake in contention.

It is late at night when the dissatisfaction with taxi drivers is at its peak.

Try hailing a taxi in the middle of the night: if your destination does not conform to their desired location, they could refuse you or reject you.

More often than not, they would prefer not to use the meter and throw you a figure. That figure could be more if they suddenly tell you that they will ‘balik kosong’, meaning that it would be difficult for them to get a passenger in your area after dropping you off.

It is not easy to find an equilibrium where both services can co-exist without losing much to each other.

While it may be true that E-Hailing also takes a slice from the same cake, I doubt that any taxi driver has gone unemployed since the introduction of E-Hailing services.

Swedish-German economist at Oxford Martin School conducted a study in 2013 in cities in the US of the impact Uber has had on the income of taxi drivers.

He found that though it is true that the income of taxi drivers had been affected, the drop was in the region of 10 percent, while E-Hailing services had resulted in a 50-percent rise in the number of self-employed drivers.

Frey expressed that traditional jobs have not been displaced.

In the case of Langkawi, it is difficult to get a taxi, especially if you venture out to the less touristy places.

The Langkawi Craft Complex for example, is almost half an hour away from the taxi stand in Kuah, and 25 minutes away from the one at the Langkawi International Airport.

I doubt if anyone would get a taxi if they waited by the road side.

Perhaps the answer to the plight of the taxi drivers is to subscribe to an E-Hailing service of their own, much like the radio taxi service.

Pay a certain amount as annual fee to a management company, they can download the application, and charge by the meter, and the payment goes into an account, just like Grab or Uber.

Like their counterparts in Singapore, they should be able to accept credit and debit card payments, and passengers get to rate them as well.  I am sure that such an application could be produced.

That way, they have a level playing field with the other E-Hailing services drivers, and maintain the quality of their service.

With two-thirds of the world’s population due to live in cities by 2050, the cake will keep on growing for both taxis and E-Hailing services drivers.  A combination of private providers and public mass rapid systems will be the imminent scenario.

My only wish for now is for foldable bicycle owners to be allowed to bring their bicycle on board our trains during peak hours.

That would increase the ridership of the trains, while both E-Hailing and improved taxi systems complement the process by moving workers from office to meeting venues and back.

(This article was first published on The Mole)

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