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Some issues abroad on car sharing/ride sharing companies

There are two articles recently that are worth reading for those who are into ride-sharing/car-sharing. And I am not necessarily referring to those who regularly take Uber or Grab, or those who opt to use these whenever they need a taxi ride. There are many who are already studying these services being provided not by your traditional or conventional taxi companies or rental vehicle companies but by supposedly private individuals who supposedly have the spare time and spare vehicle that they can use to provide transport for other people. I use the word “supposedly” here because this is a big assumption and the premise by which transport network companies like Uber, Grab and Lyft have been able to go around the bureaucratic processes that taxi and other companies have to go through as formal public transport (i.e., public utility vehicles). These articles are along the lines of the discussions in previous articles I have posted here about ride-sharing/car-sharing, and are mostly based on the experiences in countries who have more developed and presumably better transport than us in the Philippines.

Denton, J. (2017) Two Federal Lawsuits Could Spell Big Trouble for Uber, Pacific Standard, http://www.psmag.com, April 10, 2017.

McGraw, D.J. (2016) How Lyft and Uber are Ignoring the Poor, Pacific Standard, http://www.psmag.com, May 12, 2016.

 

I leave it up to my readers (any researchers out there?) to pick-up the main points and perhaps look at the issues from different perspectives. I have pointed out before that the situation in Metro Manila could be very different from the situations in other major cities like Cebu, Davao and Iloilo. And so transport network companies may not necessarily succeed in cities where taxi services, for example, are significantly better than what we have in Metro Manila.

Contradictions in transport mode choices?

A friend posted a photo on social media and it immediately got my attention as it featured an ad by popular ridesourcing company Uber on a public bus in Singapore. There is a slogan there that reads: “Because weekends come once a week, make your move.” This statement is a promotion for Uber, which is already making inroads in the city state where taxi services are probably among the better ones in the world in terms of service quality and efficiency.

The ad itself is a contradiction in terms of who is promoting itself and where it is being promoted. Such promotion gimmicks are not beyond companies like Uber, which project themselves as mavericks in what are considered as traditional areas such as transport. Here is the photo of Uber advertising on a public bus in Singapore:

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Taxi ownership and operations (i.e., driving) in Singapore is restricted to Singaporeans. Uber faced some issues with their operations as there were a significant number of foreigners, it seems, who took to Uber as a means for employment. In a city-state like Singapore, which discourages private car ownership and use through schemes like congestion pricing and the provision of high quality public transport services, Uber could face a much stiffer challenge to its march towards dominating conventional taxis.

Some views on Uber and Grab

I took screenshots of a DOTr social media post on Transport Network Companies (TNCs) and the comments made on the post. If the post is an accurate quote of the current LTFRB Chair, then it reveals how a top official of the LTFRB (and at the same time DOTr) thinks about such services and perhaps shows a lack of understanding for what these “innovative” companies are all about. I purposely put the word innovative in quotation marks because there are also challenges that Uber is currently facing.

But then can we blame the official and others of how they understand the business models of TNCs like Uber and Grab? Can we blame them when these companies’ models’ seem to be quite different from their original set-up that made them the popular modes that they are now in many countries? At the same time that they have become the bane of conventional taxis, it seems they are also killing off the good ones, too. In my opinion, Uber and Grab are treading a fine line between ridesharing/carsharing (their original model) and taxi services.

Here are some social media posts not too long ago regarding fare regulation being applied to TNCs:

 

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There are healthy (as well as inane) discussions online about TNCs. More recently, there were reactions when Uber appeared to take advantage of a nationwide jeepney strike. I guess people should take in different perspectives about TNCs and in the end, it is the commuters’ welfare that is important regardless of what modes of transport are available them. That welfare should be the priority of government and we should¬† not blame the latter when they are actually doing their jobs.

On transport, technology and politics

I frequently share articles I found to be interesting and intriguing. One of my current research interests is on ridesharing, ridesourcing and carpooling. And so when I saw this article online, I felt it had some good arguments pertaining to ridesharing considering these are all claiming to be

Transport isn’t technology, it’s politics

The article is by Konstantinos Dimopoulos and appeared on How We Get to Next last February 17, 2017.

The other TNCs – Wunder and Angkas

The Land Transportation Franchising & Regulatory Board (LTFRB) recently issued a couple of press releases pertaining to two Transport Network Companies (TNCs). The issuances were for Wunder and Angkas to cease operations. Copies of the press releases were posted at the Department of Transportation (DOTr) Facebook page and are reproduced here:

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Prior to these press releases, both Angkas and Wunder have been aggressively promoting themselves in social media. Wunder is the more established entity and is actually based in Germany. Its operations are basically carpooling and match drivers with passengers traveling about the same time and along their likely routes between homes and workplaces/schools.

Angkas appears to be a locally developed app. The big difference here though is that it is for motorcycle taxi services. While it is clear that tricycles (3-wheelers = usually a motorcycle plus a sidecar) used as public transportation are under the jurisdiction of local government units, their operations are governed by national laws. These include tricycles supposedly being banned from operating along national highways. Motorcycle taxis are regulated along the same lines with LGUs having the responsibilities over their operations (refer to my previous posts on habal-habal and Skylab) and are generally tolerated in rural areas where there is a lack of motorized transport services available. As far as the national government is concerned though, motorcycle taxis are prohibited and this is due primarily to safety concerns.

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I don’t know where Angkas gets the “professional motor taxi” tag since it is most likely that riders offering their services are not at all trained or experienced to provide public transport services and on a 2-wheeled vehicles. Such operations are risky especially to passengers. Even in countries like Thailand and Vietnam where motorcycle taxis are generally legal, it is established that such transport modes are unsafe with motorcycles being involved in more crashes compared to other vehicles. Motorcycles also have a higher fatality rate compared to other vehicles.

I think Wunder is different and could actually be closer to the classic (or conventional) carpooling idea compared to ridesharing/carsharing leaders Grab and Uber. Wunder clearly states that its aim is to maximize the available seats for the two likely trips people make with their vehicles. These two trips are usually one in the morning (i.e., to the workplace or to school) and another in the afternoon or evening (i.e., to home). As such, the income derived from Wunder is limited to the 2 trips although a driver can maximize income by accepting multiple passengers. In contrast, many (not all) Uber and Grab drivers in the Philippines operate practically the whole day and are basically taxis. I would recommend that the LTFRB look into the operations and business model of Wunder and perhaps reconsider their decision against it.

Do people understand what Uber and Grab really are?

Over the holidays, I’ve read a lot of posts about Uber and Grab. Mostly, these were complaints about the surge pricing scheme of Uber. A lot of people cited the exorbitant rates Uber charged for trips even short ones like Ortigas to Center to Greenhills and Trinoma to Katipunan. Though the complaints are legitimate ones, I also try to see the other side of the coin considering Uber and Grab do tell potential passengers how much it will cost them for such commutes during peak periods (i.e., when roads are congested). Potential riders do have a choice whether they should take the rider (and therefore agree with the fare stated by the app) or take another transport mode instead. The issue here should not be entirely Uber’s or Grab’s fault. Our public transport system, particularly in Metro Manila, sucks. And that includes the conventional taxis that could have provided better services if regulations were strictly implemented or if the operators managed their drivers and maintained their vehicles well. Based on my experience, taxis in Cebu, Iloilo and Davao, for example, are better managed and regulated, and provide better service quality than those in Metro Manila.

Then there were the joint LTFRB and DOTr advisory for Uber and Grab units and the LTFRB order on surge pricing and fare rates.

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From both cases, it is clear that car-sharing or ridesharing services like Uber and Grab are treated as taxis rather than as premium services that likely entail higher fares but are subject to prospective passengers’ willingness to pay for such services.

Such opens the door for more questions than answers: Is this a misunderstanding or perhaps a deliberate action on the part of Philippine regulators (LTFRB and DOTr)? Why can’t they impose the same standards for vehicles, operators and drivers of conventional taxis? Wouldn’t it be in the best interest of the general riding public for LTFRB to clamp down on conventional taxis in order to reduce dilapidated vehicles as well as unqualified drivers? Surely, conventional taxis will become more attractive if they provide better services including significant reductions in the incidence of typical complaints against taxis like negotiating fares and refusing passengers because of their destinations.

Here are some more questions that need clear and objective answers for one to have a fair assessment of these services:

  • Do these show how much we (both commuters and regulators) understand how these car-sharing modes are supposed to operate?
  • Do officials at DOTr and LTFRB, who are supposed to be regulators of public transport services know how Uber and Grab are supposed to operate?
  • How do they really fit in considering all the other modes of transport available to commuters?

Grab vs Uber: the ridesharing services battle for supremacy?

I have made it a custom to share articles here on my blog. One reason for me to do this is so I have an archive of sorts for articles that caught my attention that I have either read or not that I want to get back to. Here is another article on ridesharing, this time from a popular magazine:

Grab vs Uber: Who’s getting the riders and making money?

This is relevant material for ongoing studies we are doing about ridesharing. I am also writing a couple of papers on this topic that we intend to present and publish next year.