Following approval granted by the authorities last
week, five taxi operators — SMRT Taxis, Prime Taxi, Premier Taxis,
Trans-Cab and HDT Singapore Taxi — will implement dynamic pricing
from next Wednesday for trips booked through the Grab mobile
application, under a collaboration between the operators and the
ride-hailing company.
The new JustGrab service will be trialled from today
among Grab employees and commuters on its rewards programme, using
cabs from SMRT Taxis, Trans-Cab, HDT Singapore Taxi, as well as
private-hire cars.
Announcing the roll-out date yesterday, GrabTaxi
Singapore head Melvin Vu also sought to allay fears that dynamic
pricing — or surge pricing — would not only lead to higher taxi
booking fares during periods of high demand, but also the
likelihood of cabs ignoring street commuters during peak hours.
The fare system for JustGrab will be similar to the
system for Grab’s private-hire car service GrabCar, which charges a
fixed fare, subject to dynamic pricing. Grab said that based on
data from January and last month, average fares for GrabCar, in
some instances, were a few dollars cheaper than fares for its
GrabTaxi service, which uses a metered fare system.
Given the larger supply of vehicles under the new
JustGrab service, the company said it expects fares to be even
lower (at least a dollar cheaper than fares for GrabCar).
Speaking to TODAY, Mr Vu reiterated that a “measured
and calibrated” approach would be taken for dynamic pricing, and
with a “huge supply pool” right from the start, “prices will be
cheaper and fluctuate less”.
Grab declined to reveal the number of taxi drivers who
will be part of the new service. Nevertheless, the five operators
have a combined fleet size of around 10,700 vehicles.
Grab said that fares for JustGrab will range between
S$4 and S$100, depending on travel time, distance, booking fees,
and real-time demand and supply for taxis. Based on last year’s
figures, only 1 per cent of private-hire car rides were over S$60,
and of these, only one trip on New Year’s Eve crossed the S$100
mark, Grab said in response to TODAY’s queries.
The new service will also do away with current taxi
surcharges, which apply to midnight fares or rides in the Central
Business District. Trip prices will be reflected on the booking
screen, although these do not include Electronic Road Pricing
charges.
Based on past data, for instance, a trip between
Tampines to Choa Chu Kang during peak hours would cost an average
of S$29 for a metered taxi and S$25 for a fixed fare private-hire
car. During off-peak hours, metered taxi fares could fall to S$26,
whereas private-hire car rides could dip to S$24.
JustGrab will provide commuters with an added option:
Those who wish to take metered taxis can continue to hire them
through the Standard Taxi icon on Grab’s app. Likewise, commuters
who wish to book a private-hire car can still do so via the GrabCar
icon.
On concerns that surge pricing could result in cabbies
shunning passengers on the streets, Mr Vu acknowledged that while
this may happen for a “handful” of taxi drivers, the majority of
cabbies have told him that it is “not economical” to cruise without
any passengers in the hope of getting higher fares through
bookings.
He added that taxi drivers have also told him that they
prefer picking passengers off the streets to accepting a call
booking.
“Because it’s a confirmed job. Because they put a bum
on the seat of the taxi faster and they cruise less,” he said. Grab
would be taking a cut of 10 per cent for each JustGrab ride. In
comparison, it charges a 50-cent commission for each metered taxi
fare booking now.
Last week, Singapore’s biggest taxi operator
ComfortDelGro, with close to 17,000 cabs under its Comfort and
CityCab brands, said it will strike out on its own with a flat-fare
structure similar to metered taxi fares for trips booked via its
in-house mobile application. Based on the timeline provided earlier
by ComfortDelgro, this could be rolled out around the same time as
JustGrab’s launch. Mr Vu said the “devil was in the details” of the
rival service.
“I don’t know how they will match demand and supply
effectively. We’ve been doing this for three years and we’re a firm
believer in matching accurately — at the time of booking — demand
and supply,” he said. Grab claims that it expects rides to increase
by a fifth for taxi and private-hire car drivers who use
JustGrab.
Meanwhile, as competition within the industry looks set
to intensify, Grab also announced enhanced perks for its taxi
drivers, with a monthly 8 per cent Medisave contribution based on
their earned incentives. Private-hire car drivers receive higher
Medisave contribution rates at 10 to 15 per cent, depending on
their performance.
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