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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.
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?
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:
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.
I came upon this article posted by an acquaintance on his social media account. The article appears to be click-bait given its title but reading through it, the author leads you to other articles of what seems to be a series about Uber’s operations. I won’t give any assessment here as we are also doing research on ridesharing (although for now its mostly about the passengers perspective and characteristics). I will let my readers digest the content and context of the following article:
This is a follow-up on the recent post on ridesharing/car sharing where I talked about my observation that there seems to be an oversupply of vehicles being used for what is claimed as ride-sharing or car-sharing. In that post, I mentioned an observation by me and my colleagues that popular ride-sharing/car-sharing companies like Uber and Grab have led to more vehicles on the roads. I add to that the findings of our students that:
- Those shifting to Grab and Uber are mostly those already using taxis (regular users) and those using UV Express, which is a higher capacity vehicle using either vans or AUVs (average passenger capacities between 10 and 18 passengers).
- GrabCar and Uber function more as premium taxis rather than ride-share or car-share modes.
A friend who’s among the first Uber drivers in the country (He was already an Uber driver before the explosion in the service’s popularity.) shared that Uber earlier had been a real car-share/ride-share. My friend’s full time job was as a musician and he thought of becoming an Uber driver only to have some additional income for when he wasn’t busy with his work or didn’t have gigs. He was not roving around Metro Manila to get fares much like what is now being done by many Uber and GrabCar units.
Later, when Uber and Grab began more aggressive marketing; promoting their services as potentially generating much more income than conventional taxis and perhaps even a person’s full-time job, people started purchasing cars not for their use but to use in business in the form of Uber and Grab cars. I can probably understand those who bought cars and drove the cars themselves. To me, these would still qualify as ride-sharing/car-sharing but on the upper limit of what we can really consider “sharing” since they are supposed to be driving during their free times. Arguably, unemployed people have the entire day as free time compared with employed people or those who run businesses other than being Grab or Uber drivers. These include housewives and even “househusbands” who may have a vehicle at home that they can use for Uber or Grab. Employed people can only share their rides during the time they go to their offices or when they travel home later in the day. Others may have more free time as business people would likely have more flexible schedules.
Following is a series of screenshots I took en route to a meeting. It is, I believe, more systematic in terms of trying to determine the availability of vehicles – in this case GrabCars. Again, correct me if I’m wrong about my assumption that the vehicles displayed represent available cars. If they do not then it means the app is misleading people into thinking there are available cars for them to hire.
Grab Cars in the vicinity of UP Diliman
Grab Cars in the vicinity of Eastwood
Grab Cars in the vicinity of Tiendesitas
Grab Cars in the vicinity of Cainta Junction
There are a few interesting observations we can make out of transport services in Metro Manila and chief among them is the poor quality of service that we can generalize among most if not all modes of public transport available to commuters. This poor quality of service of public transport is what drives many people to aspire to own and drive or ride their own vehicle. Already there has been a surge in motorcycle ownership in Metro Manila and its neighboring towns and cities (collectively Mega Manila) and car ownership is also on the rise. These trends have led to increased congestion along many roads. And we will probably not see a significant improvement until the mass transit projects have all been completed. These include the Line 2 Extension to Masinag, the MRT 7 along Commonwealth, the Line 1 Extension to Cavite, and yes, the capacity improvement of MRT 3. Hopefully, there will also be BRT lines along C-5 and Quezon Avenue to complement the rail transport projects.
The UV Express is actually a response to poor public transport services as it evolved out of the FX taxi services of the 1990s that later mixed with informal van and AUV services. These are actually a precursor of today’s ride sharing modes. Only, in those days when the FX service was born, you didn’t have tools like apps to facilitate your ride. People had to agree about the fares and the destinations from terminals like those in Cubao (Quezon City) and Crossing (Pasig/Mandaluyong).
But let us focus on three services that would not have been attractive if only services by their conventional counterparts were (very) satisfactory and if there was a comprehensive and efficient mass transit network in the metropolis. These are Uber, P2P buses and airport express buses.
Uber offers services much like that of the conventional taxi. Its advantages are mainly having recent model vehicles (not dilapidated ones), a better driver (this attribute is quite subjective), and an app-based system for availing services. Fares are generally more expensive than those for regular taxis. And there is a surge pricing for when congestion is really bad. It has a very good feedback mechanism that allows passengers to evaluate their drivers. However, this wouldn’t have been necessary if taxi drivers in general were more disciplined and courteous to their passengers.
P2P buses operated by Froehlich Tours offers services much like that of conventional buses. Its current advantages over conventional buses are that it operates express services, buses are new, well-maintained, and with drivers that appear to be more disciplined than the typical public utility bus driver. A friend’s take is that P2P’s are the bus equivalent of UV Express. It is not at all necessary if the quality of service of regular buses were much better than it is right now. And I am referring to the practically stop anywhere, recklessly driven and poorly maintained regular buses.
Premium airport buses have recently been introduced and these are operated by Air21, which is a freight forwarding company. It is a service that’s long overdue given the many difficult experiences of people to and from NAIA’s passenger terminals. While an airport limousine bus service should have been provided many, many years ago it also is a reflection of the poor quality of airport taxi services. Airport taxis are expensive and according to many stories circulating can be predatory.
What I am driving at, if it is not yet so obvious, is that many ‘new’ services are actually borne out of crappy services of conventional modes. There are many lessons to be learned here in and lest I be accused of neglecting other Philippine cities, I should mention that Metro Manila presents so many lessons to be learned by other rapidly growing and urbanizing areas in the country. At this time we can mention Cebu, Davao, Iloilo, Cagayan de Oro and perhaps Clark/Angeles as metropolitan areas to watch in terms of transport system development. Hopefully, there’s a kind of reverse psychology in their approaches to address their transport needs in that they avoid what has been done in Metro Manila. Surely, transport services in these other cities can do better than Metro Manila’s.
The motorcycle taxi is common in Southeast Asia and it seems that bringing it to the next level means taking advantage of available technology to facilitate getting a ride. In the forefront is Grab, the company behind GrabTaxi and GrabCar, which is a similar service to the popular Uber. GrabTaxi facilitated getting a taxi and is already popular for being quite effective to many who have availed of the service. I am among those who have used GrabTaxi and so far has been satisfied with the service.
Recently, Grab had been in the news for a service it has been providing elsewhere and which also appeared on their app in the Philippines – GrabBike. I also saw this feature on their app and was curious about how they were able to go mainstream on this in the Philippines because motorcycle taxis (e.g., habal-habal) are basically illegal in most cities and are unregulated except by barangays or a few local governments where their services have been recognized. The Land Transportation Franchising and Regulatory Board (LTFRB) ordered Grab to stop offering this feature of their services. It seems they haven’t done so as GrabBike is still there and the service very much alive.
In fact, we tried to check if there was a GrabBike near our office and voila! There was one unit that appeared in our screen. I would bet that there would be more appearing on one’s screen if he/she happened to be in an area where there’s demand for motorcycle taxis services (e.g., Eastwood, BGC, Ortigas, Makati CBD, Cubao, etc.).
GrabBike featured on Grab’s new look app
Motorcycle taxis are popular in the provinces and especially in rural areas not just because of the convenience they provide (easily hailed and can maneuver through congested roads) but because they are a necessity, being practically the only public transport mode available to people. The main issues against them in the Philippines are safety-related. Not all providers practice safe riding and most if not all are sure to have no insurance to cover their passengers in case they are involved in a crash. One cannot fully blame motorcycle taxi service providers for offering their services considering the traffic mess in many highly urbanized cities especially in Metro Manila. However, offering such services to the public means that service providers should bear responsibility for ensuring the safety of their passengers. This would basically be in the form of insurance and regulation particularly for fares they charge. I wouldn’t even go to the tax implications of the income they derive from their operations.
These services will no doubt continue to be offered, even clandestinely, as traffic conditions remain bad and continue to worsen. People will gravitate towards such services in order to reduce the travel times in their commutes. This is expected to happen as long as people perceive that nothing is happening to significantly improve transportation in this country.
I wrote late last year about how the Christmas and New Year holidays allow me to catch up on some readings. These are mostly contemporary articles on transport and other topics rather than whole books (though I just finished one by George RR Martin during the semester). That post with three articles may be found in this link:
I open the year with another post with a couple of interesting articles. One article reports on the newly opened bicycle ‘autobahns’ in Germany. ‘Autobahns’ basically refer to expressways or freeways. The new facilities for cycling represents what many will term as a paradigm shift for a country well known for its excellent automobiles. The concept of an expressway for bicycles actually makes sense in terms of safety and as a way to eliminate many if not all the factors that tend to discourage people from using bicycles for longer distance commutes. These do have the potential to reduce car usage (and traffic congestion) and ultimately also reduce pollution and fuel consumption. I am interested about the designs of these structures as the designs are also key to the development of similar infrastructure elsewhere including, hopefully, the Philippines.
Another article is more thought provoking in the sense that it delves into labor and legal issues surrounding Uber and other ride sharing companies. These issues are valid and need to be discussed thoroughly not just in the US but elsewhere where ride sharing services have proliferated and profited. Many of the points pertaining to labor and compensation are valid, and I would like to think that these extend to the franchising issues that have been raised against ride sharing, which ultimately have implications on their business model. The legalese may be a turn-off to many who would argue that companies like Uber and Grab provide them with a good quality of service. But then that begs the question of whether they would have the same view if taxis were better than what they are now.
Happy New Year and happy readings!
The talk about Uber vs taxi is a hot topic in many cities around the world and also in Metro Manila where Uber has gained a foothold and a strong following among mostly ‘former’ taxi goers. Many have stated that Uber provides the service that taxis should have been providing. Uber vehicles are supposed to be of newer models and drivers are supposed to be screened carefully. Uber even has a feedback mechanism not just for drivers but for passengers as well. Basically, Uber provides the quality of service everyone wants to have on regular taxis. The irony of course is that regular taxis are supposed to provide a higher quality of service compared to other public transport modes considering it is basically a for hire car short of a limousine service. But then this begs the question: If you had good taxi services in your city, would you still consider Uber? Or perhaps would Uber have a lot of demand in a city with good taxi services? Perhaps there will still be a demand for Uber but the clamor will not be like that in Metro Manila. And there are few cities with ‘good enough’ taxi services that can compare with Uber in terms of quality of service.
A good example of where there are ‘good enough’ taxis and there is a healthy competition not between Uber and conventional taxis but among taxi operators themselves is in Iloilo City. We have discovered many years ago that Iloilo City had one Light of Glory taxi company that is very popular among Ilonggos and visitors as the drivers were generally more honest than others and they had an efficient dispatching system including desks at the airport and a major shopping mall.
Light of Glory Taxi at the airport parking lot
Light of Glory has its own app, which you can get for free and install on your smartphone. It is not as sophisticated as Uber’s or Grab’s apps in terms of features but it gets the job done (i.e., getting you a taxi).
Dispatch sheet – note the attributes the company is trying to promote among its taxis: “Clean, Safe, Reliable, Comfortable, Drug Free” These are attributes we all want of our public utility vehicles whether these are taxis, jeepneys, buses or tricycles.
The Light of Glory taxis is a well run company. Their drivers seem to be treated very well by the operator (drivers claim they have a better compensation system) and generally drive better than other taxis. Their vehicles are also seem to be better maintained compared to others except a few of the larger companies like GDR. Everyone knows about the best taxi company in Iloilo and would most likely prefer their taxis over others if the choice is given to the taxi-going commuter. To compare, I remember the Comfort taxis of Singapore and how many Singaporeans and foreigners living in SG prefer these taxis over others. Comfort taxis have a good dispatching system and you can make reservations for trips in advance. Of course, there are additional fees for on-demand services including arrangements for pick-ups and drop-offs (e.g., your residence to the airport).
I had wanted to write something on Uber the past weeks but couldn’t because I wanted to have some visuals to go with the text. And so one time we decided to use Uber, I consciously took some screenshots for the photos that are shown in this post.
After opening your Uber app, you can indicate your pick-up point and you destination. You can see how many Uber drivers are nearby based on the map and the quick reference on screen. You can also check for a fare estimate as well as select the service you want. There are currently only two types of services available in Metro Manila – UberX and Uber Black. UberX is the default service and involves a regular car. Uber Black is a bigger and more ‘luxurious’ vehicle. Of course, you pay more for a better vehicle. Once you have inputted the necessary information for your itinerary, you can put in the request. Success in getting a ride is immediately shown on your phone.
The screen shows that the driver is en route to your pick-up point. Details on your ride are provided including the name of the driver, the vehicle make, model and plate number. The vehicles I have rode on so far are recent models and most have no license plates yet – an indication of how new these vehicles are. Uber is supposed to be screening both the drivers and vehicles being registered to provide their services. One criteria for vehicles is that these are supposed to be recent models and well maintained, what’s perceived to be the opposite of vehicles used as conventional taxis.
During the trip, you can get updates on your progress through the map onscreen. This includes the estimated time of travel until you reach your destination. Information on the driver is also shown including his average rating. Our driver in this example had a 4.6 star average rating. I guess this is good given the star rating scale of 1 to 5 with 5 being the highest rating.
At the end of the trip, you can receive a receipt on your email. The receipt includes details on your fare, the start and end times of your trip, the travel distance and the route taken in map form. Information on the driver and a note for rating your driver is at the bottom of the receipt. Of course, you can save this for future reference and perhaps print it out in case you will be reimbursing the cost of your trip.
After rating your driver, you will receive another message thanking you for rating your driver. Our driver that afternoon was good and drove safely. He wasn’t talkative but was polite and could strike up a conversation (My companion asked a few questions about his driving for Uber in an interview-like manner.).
What you don’t see is how your driver rated you. Uber also asks drivers to rate users and I would guess that this will have repercussions on passengers with bad attitudes. The ratings work both ways as Uber customers should be wary of their potential drivers as well as their own behavior. I suppose that drivers get information on whether a potential passengers is a rude one and may opt to avoid such passengers.
My take so far on Uber is that it is what conventional taxis are supposed to be. I find Uber drivers to be better in terms of politeness and safety in their driving habits. Fare-wise, Uber has been less expensive than Grab Taxi or conventional taxis as you don’t have to bid to get an Uber ride. The Grab Taxi app basically formalizes the bidding process as it asks you how much gratuity (tips) you are willing to give for a ride. I feel that this gratuity feature is a major determinant for taxi drivers choosing their fares and leads to more expensive fares. Of course, I haven’t experienced Uber’s surge pricing yet but friends who use Uber have informed me that this can be quite steep and can hurt your pocket or wallet. Still, I think Uber provides good service but it is not for everyone especially those on a budget or going to a place where roads are generally congested.
Social media is again abuzz with stories about Uber and how Philippine government agencies like the Department of Transportation and Communications (DOTC) and the Land Transportation Franchising and Regulatory Board (LTFRB) are hassling Uber, Grab and similar companies into complying with government regulations covering their services. Is it really a hassle and are these “Transport Network Companies” or TNCs the real deal in terms of solving part of Metro Manila’s transport woes?
I believe Uber and other services like it have good intentions towards providing high quality, on-demand transport services. However, based on what I’ve read about the service in other countries (particularly in the US and Europe), the intention (original?) was to take advantage of surplus or excess capacity of vehicles being driven by “owner-drivers” between origins and destinations such as their homes and offices. That means an improvement of sorts for traffic as, instead of having one vehicle per person, two or more can share a single car. The main differences with conventional carpools is that the driver and his passengers practically do not know each other, and the passengers pay the driver a fee that is agreed upon at the start of the transaction. This works well in car-oriented cities as well as those with less than satisfactory public transport services especially when it comes to taxis.
The last sentence seems to be the right description for Metro Manila and other rapidly growing Philippine cities. And so, Uber, Grab Car and other shared service attracted many users who can afford them and providers willing to share their rides with total strangers. I stated “owner-drivers” in the previous paragraph as this was supposed to be an essential part of the set-up where Uber and others didn’t add to the cars already on the roads. Problem is, apparently and allegedly, some enterprising people who had the resources thought it would be a good idea to deploy all their vehicles (and even purchase additional ones) by hiring drivers they could register with Uber or Grab Car. That way, they thought they could bypass the typically bureaucratic process of getting a franchise for taxi or rental car franchises that also include all those business permits and, of course, taxes. The result of this would not be the utilization of excess capacity but the addition of more cars on the roads and therefore contribute to worsening congestion.
As far as the LTFRB is concerned, like it or not, they are just doing what they are mandated to do and are supposed to do with any transport service provider that is not purely private (i.e., services with a fee). It just so happens that the DOTC and LTFRB have been on the receiving end of a lot of flak from the public and especially in social media for what is perceived as the agencies’ ineptitude in dealing with major issues in public transportation. These include the continuing saga that is EDSA-MRT 3 and the perceived low quality services provided by buses and jeepneys in general that leave people at the mercy of taxis and UV express if they opt not or cannot afford to purchase their own vehicles.
The main issue is not whether DOTC and LTFRB should pay attention to Uber and others like it. The agencies should as per their mandates. However, there are a lot of other more serious and more urgent issues/problems including the much delayed mass transit projects and the low quality of service being provided by buses, jeepneys, UV express and conventional taxis that the DOTC and its attached agencies need to act on and now. I know it is a generalization (There are many good bus, jeepney, UV express and taxi drivers and operators out there who are also working their butts off to earn a living.) but then when you combine unsafe driving, with high fuel consumption and a lot of harmful emissions then you get a cocktail that’s definitely bad for all travelers.
How many people use Uber or Grab Car or taxis? Do they outnumber those taking the LRT/MRTs, buses, jeepneys and UV express? They don’t and therefore only represent a small percentage of the trips being taken everyday in Metro Manila and adjacent areas. And so the more pressing issues are really those pertaining to mass transit and the dire need to construct these systems once and for all in order to achieve a more sustainable and inclusive transport system for this still growing megalopolis.