Cab companies to collaborate with Uber

PETALING JAYA: Cab companies are set to embark on a pact with Uber in an unexpected move to save the taxi industry.

Despite the fact that cabbies have been up in arms against the ride-sharing service since 2015 with reports of physical assault against Uber drivers, taxi companies told theSun that "instead of continuous war against Uber, it is time to embrace the 'enemy'".

As a clear sign of conceding defeat to the growing popularity of Uber, Grab or e-hailing services, a director of a leading taxi firm stressed that cab companies have little choice but to respond to market demands by utilising the Uber app.

Last October, theSun reported that around 10,000 cabbies (and counting) have given up or returned the taxis and many taxi companies may not survive beyond 2018 due to stiff competition from Grab and Uber car-sharing model.

theSun understands that a memorandum of understanding (MOU) will be signed between taxi companies and Uber Malaysia Sdn Bhd this week.

Asked why they decided to collaborate with the San Francisco-based start-up instead of with local app developers, he replied: "The public are more aware with the Uber branding."

"We have also been using local apps (for bookings) but we are not getting much traction due to lack of marketing," he said.

For a start, around 500 cabbies throughout Peninsular from at least six cab companies will be part of a Uber pilot stage starting from next month.

It is learned that taxi companies are finalising discussions with Uber on the business model since Uber ride is largely conducted using credit/debit card transactions.

"We have to move fast since e-hailing will be regulated soon after the law amendment in Parliament this month," said a taxi company managing director.

"We will continue to operate as metered cab operators," a taxi operation manager explained.‎ "But if a taxi driver decides to take bookings via Uber, then the cabbie has to follow the fare rate set by Uber, whether it is lower or higher than the current regulated fare by SPAD."

It is also learned that the deduction of the fare income or fee charge by using Uber app will only be between the particular cabbie and Uber. 

However, it remains to be seen whether Uber will impose a 25% deduction to cabbies similar to the policy for Uber drivers (partners) using private cars.