Grab unable to fill ride-hailing market alone

Grab holds the largest market share in the domestic ride-hailing market. Photo: dtinews

More than four years after entering Vietnam, Grab has expanded its scale in the country with its fleet reaching 34,700 in 2017. This accounts for more than 82 per cent of all ride-hailing vehicles in the country, according to the Ministry of Transport (MoT).

Zing.vn stated that managing its extensive fleet and drivers has been causing difficulties for Grab. After merging with Uber, Grab admitted to be having difficulties in managing its drivers. A lot of occasions of drivers swearing and stealing customers’ belongings have been reported.

Furthermore, with the discount of 20-28 per cent, higher than Mai Linh’s 15 and ABER’s 10 per cent, Grab is also facing the risk of losing drivers to competitors. In late March, the time Mai Linh announced launching Mai Linh Bike, the taxi firm’s representative said that the number of Grab and Uber drivers applying for jobs at Mai Linh also skyrocketed.

Another new player in the domestic ride-hailing game, ABER, is also trying its best to attract drivers by offering free-of-charge medical exam packages, organising happy Sundays, giving 50 per cent discounts to drivers on coffee at ABER’s coffee store system across the country.

In addition, FastGo charges no commission during the first phase of operations, then will charge 10 per cent commission.

These moves could show how new ride-hailing firms are luring in drivers. Drivers could probably make or break their business.

Zing.vn quoted Nguyen Van Thanh, chairman of the Vietnamese Automobile Transportation Association, as saying that the ride-hailing market will become even more dynamic as competition mounts among firms. Thanh also affirmed: “The market offers great development opportunities for other ride-hailing firms.”

Go-Viet will enter in Vietnam in July. Photo: theleader.vn

While domestic applications have not gained much of a foothold in the market as their services are limited and Grab’s main business line is passenger transport, Indonesia-based Go-Jek officially entering Vietnam under the name of Go-Viet in July is expected to provide more choice for customers.

In Indonesia, the Go-Jek application does not stop at ride-hailing, it also offers various services, including food delivery, house cleaning services, and online payments, among others. Entering Vietnam, Go-Viet will target two main services—ride-hailing and shipping—and plans to launch more services in the future.

Go-Jek has a specific strategy to compete with Grab by targeting a large customer base, then offering various services to meet customer demand. Diversifying their current applications is creating many opportunities for ride-hailing firms, especially as Vietnamese people do not stop at travelling but are also looking for shopping, house services, and online payments, similar to Indonesia and Southeast Asian countries.