Hong Kong taxis may be willing to team up with ride-hailing giant Uber for ‘win-win situation’

Despite past differences and local controversy, vice-chairman of the Association of Taxi Industry Development says cooperation is possible

PUBLISHED : Tuesday, 12 December, 2017, 7:09pm
UPDATED : Tuesday, 12 December, 2017, 11:01pm

Hong Kong’s taxi industry has said it may be willing to join hands with ride-hailing firm Uber after the firm’s local boss proposed an e-hailing partnership on Tuesday.

Kenneth She Chun-chi, Uber Hong Kong’s general manager, proposed the idea for cooperation with the taxi trade as a recent Hong Kong Consumer Council report urged the government to relax the current 1,500 private hire-car permit system to allow ride-hailing vehicles to be on the road legally.

“Our door is always open. We are now studying whether there is room for Uber and the taxi industry to cooperate to jointly tap the e-hailing market,” She said.

“After all, the taxi industry may not have the technology platform like ours to provide tailor-made services. If we cooperate together, they can also make use of our backup customer service and even capitalise on our good image to regain consumer confidence as they are now having an image problem,” he added.

In a surprise response, vice-chairman of the Association of Taxi Industry Development Ng Kam-wah said they welcomed the olive branch from Uber as their group had discussed the possibility of cooperating with the ride-hailing firm.

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“We think that there is room for the taxi trade to cooperate with Uber as this will be a win-win situation for us,” he said. “The taxi industry could benefit from the ride-hailing platform, effective marketing and good customer image of Uber while Uber can operate legally with the taxi vehicles,” he added.

Ng pointed out to make such a cooperation possible, Uber needed to make some compromises over the fare system. “Now Uber charges a certain percentage of drivers’ income. Our requirement is that if we cooperate, Uber can only charge additional fares from passengers, not from drivers. Our bottom line is that taxi drivers’ income will not be affected under this e-hailing platform,” he said.

Under the Consumer Council’s proposal, existing cabbies could also be players under the relaxed platform for ride-hailing services, which could attract three to 11 operators. The proposed market reform was aimed at giving consumers more choices as many passengers expressed dissatisfaction with local taxis. Common complaints include rudeness, overcharging and refusing to give passengers rides.

She stressed such a cooperation model between Uber and taxis was already in place in Singapore and Taiwan. “We are more than happy to collaborate with taxis. We believe that taxis and Uber can coexist together,” he said.

He said as long as the taxi industry was ready to communicate with Uber, they could work out other details such as a fare mechanism.

However, a taxi trade coalition was outraged by the council report, threatening to sue the government if it followed the watchdog’s recommendations. They declared that the unlawful operation of Uber should not be encouraged.

In view of a police crackdown in May resulting in the arrest of 22 Uber drivers, She admitted that Uber’s business had taken a nosedive in the beginning as its drivers had been turned off. However, he said the number of drivers and users had already bounced back to the levels before the May crackdown.

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“We have strengthened our support service for drivers with a 24-hour hotline for legal advice. Now our registered drivers have exceeded 30,000 better than last year with the number of our riders standing at over 1 million. The number of active users is more than 300,000,” he said.

In October, the arrested Uber drivers were charged for operating without a permit while another five drivers have filed to appeal their convictions in March of driving without a permit and third-party insurance.

Uber’s contract with AIG for third-party coverage worth up to HK$100 million for any ride-sharing trip in the city has been renewed this September for another year.

She said that the last prosecution with Uber drivers for only the charge of operating without a hire-car permit showed that the government already recognised the validity of his firm’s insurance coverage.