Grab carpooling to lower fares by 30%

Mark RaoFriday, February 17, 2017
Goh (left) with Grab’s software engineer Dominic Widdows during the launch of the company’s latest feature, Grabshare, in kuala Lumpur (Pic by Afif Abd Halim/TMR)

Grab the regional ride-sharing company in the transportation industry, introduced the new carpooling service in Malaysia and the Philippines yesterday, in a bid to lower fares by up to 30%.

Grab Malaysia’s recently appointed country head Sean Goh said GrabShare, which pairs two different passenger bookings with similar destinations within a single trip, will also increase drivers’ earning capacity.

“We wanted to serve our three most important stakeholders better [through Grab- Share],” Goh said at the service’s official launch in Kuala Lumpur yesterday.

“For our passengers, we wanted to provide them better ride availability and variability by having them share vehicles that are already in the network. For our drivers, we want to give them better productivity and therefore better earnings.”

Goh added that the newly initiated service is targeted at dense urban centres such as the Klang Valley.

It is aimed at reducing traffic congestion in Malaysia, with the country retaining the third highest car ownership globally, based on a 2014 Nielsen study.

The carpooling platform utilises an in-house algorithm that matches two passengers’ pick- up and drop-off points to the closest approximation. The system will allow drivers to complete two fares within one ride and receive a higher combined fare, while passengers can travel to their respective destinations at a discounted fare.

Each of the two passengers is allowed to travel with one additional person for a maximum of four passengers in the vehicle, all of whom will be covered with Grab’s insurance coverage of up to US$10,000 (RM44,500) per person.

The service comes on the back of an already saturated and price competitive market, with approximately 50,000 to 60,000 registered Grab and Uber drivers in Malaysia.
Grab also does not perceive competitive pricing as an issue, stating that all Malaysians are attracted to good deals and promotions.

“From Grab’s perspective, we assess when our customers value promotion the most. Recently, the country had a lot of festive events and people had been spending a lot, so we want to give a reward for our users who have stuck by us.”

Meanwhile, Grab will look to build off its success in Singapore, where it was implemented in December last year.

The country has recorded two million GrabShare rides in the past two months, with drivers’ income reportedly increasing by an average of 10%.

Goh said Grab will further maintain its pre-emptive and reactive approach to monitoring and vetting its driver partners.

He said all drivers looking to register under the company will undergo a background check to detect any discrepancies, from criminal to civil, while their vehicles will be assessed for safety.

Currently, registered Grab drivers will also be continually monitored and appropriately reprimanded for any breach of safety or conduct.

The company is currently operational in 35 cities across Malaysia, Singapore, Thailand, Indonesia, Vietnam and the Philippines, with over 630,000 drivers across its network and a 95% market share of third-party taxi-hailing apps, according to Grab research.

On another issue, Goh said Grab had fixed a glitch in its e-hailing system, whereby fares to Genting Highlands were charged a flat rate of RM110, and could look to compensate drivers who lost out due to the error.

“There was a glitch in the system where a ride from Kuala Lumpur International Airport (KLIA) to Genting was at the same rate as a ride from the Klang Valley to Genting, which we understand is not proportionate to the distance driven,” Goh explained.

“We have received feedback from our drivers and put in a fix as of yesterday.”

He said fares from KLIA to Genting have now been corrected to RM170, while the compensation for driver will be determined on a case-by-case basis.

Goh said the company’s recent RM1 fine for drivers who reject bookings is to protect the earning capacity of its drivers.

“What we started to notice recently is that a lot of jobs that come in [through our e-hailing platform] get rejected by multiple drivers,” he said at the same event.

“This means genuine drivers on the system looking for jobs do not actually see these jobs in the first place.”

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