Questions over taxis, Uber joining forces
The local taxi industry and the ride-hailing company have shown an interest in cooperating. But a potential partnership raised many issues and will it ultimately just enhance Uber’s market position with an expanded fleet?
Conventional wisdom says “if you cannot beat them, join them”. Oddly enough, this could become a possible way out for the war between the local taxi industry and the ride-hailing company Uber. Just as similar partnerships are being explored elsewhere in the region, it has emerged that the Hong Kong rivals have also shown interest in cooperation.
It is too early to read too much into the goodwill expressed in a South China Morning Post report. After all, who would have thought there was room for negotiation, let alone collaboration. But however unthinkable it may seem, even the worst enemies could sometimes make bedfellows in the world of business. The olive branch is to be welcomed.
In an apparent shift in business strategy, the California-based transportation unicorn is reaching out to various local taxi operators following a series of setbacks in Asia. In August, Singapore’s biggest taxi operator, ComfortDelGro, announced that it was in talks with Uber over a possible alliance that could see its 15,500-strong fleet made available on the ride-hailing app. Last month, Uber made further inroads by forging deals with several taxi firms in Taipei. Similar tie-ups are being sought in other Southeast Asian countries.
It sounds all good in that the hailing platform can help avoid empty taxis driving around looking for customers, thereby easing traffic and air pollution. By using taxis instead of unlicensed limousines, Uber may be able to operate within the law. The industry can also benefit from its technological support and marketing.
But there would not have been so much dispute if the solution was as simple as forging a partnership. What makes Uber tick is the convenience and better service. Why would passengers still turn to it if what they get is just the same old taxis and poor service? And if any additional fares are not to be borne by the industry, are passengers willing to pay more? What do drivers gain other than a better hired-out rate? Ultimately, will it merely enhance Uber’s market position with an expanded fleet? They are valid questions to answer for any joint ventures to make economic sense.