Uber: Who says we are idle?

Feb 11, 2017 03.00PM |

by Vanessa Wu

NEITHER is ComfortDelGro for that matter.

Singapore’s biggest taxi company is hoping to introduce surge pricing, which is an Uber innovation, reported The Straits Times (ST) today. It is also proposing to flatten its complicated fare structure, said its new CEO, Mr Yang Ban Seng.

Commuters would probably appreciate a simpler system given that there are close to 10 different flag-down rates, three different metered-fare structures and more than 10 kinds of surcharges, as well as eight types of phone-booking charges in Singapore. This, however, is provided that a flatter fare is not levelled up, going by what the Land Transport Authority (LTA) found out in 2015.

But surge pricing where fares rise according to real-time demand? Such fares can exceed $140 at crunch times, such as during rail breakdowns.

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Mr Yang said that the proposals would be made to the Public Transport Council (PTC), although he doesn’t seem to hold out much hope: “We would love to do surge pricing, but I don’t think we’re allowed to.”

If ComfortDelGro, the biggest player with more than 16,800 taxis in its fleet gets its way, you can bet the other smaller taxi companies will follow suit.

Uber as well as other ride-hailing companies like Grab are probably watching developments closely, even as others put their operations and strategies under a microscope.

Uber Singapore’s general manager Mr Warren Tseng came out hammer and tongs to rebut a newspaper report that close to 1,000 of its cars were idling in carpark. He said this in an interview with The Business Times (BT) on Feb 8, even though the article appeared in The Straits Times and was based on the newspapers’ checks.

Mr Tseng said that cars that have been “deemed idling in carpark lots” were either new cars that were still under inspection and needed to have the In-Vehicle Unit (IU) installed or cars that were being cleaned after their rental owners returned them.

“With such flexibility, you see cars coming in and out daily. Sometimes they are parked for servicing; other times for cleaning after the driver is done using the vehicle. As an outsider, if you look at the lots, it is easy to assume they are not being hired,” said Mr Tseng. He refused to reveal the total number of vehicles in Uber’s fleet “for strategic reasons”.

Mr Tseng also defended Uber from industry watchers who felt that it had been creating pressure on prices of Certificates of Entitlement (COE), saying that “it is unfair and misdirected to assume so.”

“If you look at LTA’s (Land Transport Authority) data, COE prices have actually dropped from April 2015, which was a month after LCR [Lion City Rental] started, to the current rates,” said Mr Tseng. Lion City Rental is a Uber-owned car rental company that rents out private cars to Uber drivers and the general public.

COE prices have definitely fallen since nearly two years ago as a general trend. But last year, industry watchers said that Uber kept COE prices up when “aggressive” bidding was observed in one of Uber’s exercise to obtain fresh COEs in 2016.

According to an ST report in April last year as well as figures from LTA, the COE prices for cars in all three categories increased in April 2016.

If there was any decrease, it was the Prevailing Quota Premium (PQP). For instance, PQP fell from $49,541 for Mar to $46,077 for April for Category A cars in 2016. PQP is the amount required for a COE extension or renewal for a vehicle already in use.

The COE prices began to fall in the second bidding in May 2016, but an ST report said that “they would have fallen more dramatically if not for strong bidding from Uber”.

In the same report, ST said that Lion City Rental had secured about 1,700 COEs for cars in three separate bids in just two months of bidding.

From this comparison, Mr Tseng’s rebuttal is mostly in conflict with other reports and LTA’s figures. But since Uber doesn’t want to talk about numbers, the actual situation is unclear and left to further speculation.

Another newspaper report today is also not helping Uber’s reputation. Saddam Hussein Norazman, 23, was yesterday jailed for six weeks and banned from driving for five years for causing the death of one of his rear seat passengers and injuring a van driver in an accident on Sept 25 last year. This is the first case of an Uber driver involved in a fatal accident.


Featured image by Pexels user freestocks.org. (CC0 1.0)

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