Uber, Grab refuse to yield to taxis, from Jakarta to Bangkok
Indonesia appeases taxi drivers by giving green light to fare caps and vehicle limits on car-hailing companies, but the firms are determined to keep their feet on the pedal
Indonesia will allow local municipalities to set fare caps on services by Uber and similar companies in the latest regulatory setback to the growing ride-sharing industry in Southeast Asia.
The price cap is part of a broad revision of Indonesia’s ride-hailing regulations, launched in April last year following a massive protest by taxi drivers against their online competitors. The changes will also limit the number of ride-sharing vehicles allowed to operate in each district and impose new taxes on car-hailing businesses, rules analysts expect to hinder the growth of Uber and Singapore-based Grab.
“We need to accommodate the interests of old and new players,” J.A. Barata, a spokesperson for Indonesia’s Transport Ministry, told This Week in Asia. “There needs to be a balance between conventional and online transport providers.”
Local governments will have the authority to determine the lower and upper price caps for their territories. The revised regulations will launch on April 1.
In a joint statement, Grab, home-grown ride hailing startup Go-Jek, and Uber said: “We believe that the plan to allow regional governors to set fares is not in keeping with the desire to have fares that are appropriate to existing conditions. We [also] believe that numbers of vehicles, whether those serving riders using mobility applications or via conventional means, should be determined based on consumer demand.”