E-hailing business to ride on MRT and LRT boom

According to a SPAD survey, 80% of Malaysians prefer using ride-sharing services


The recent launch of the second phase of the mass rapid transit (MRT) line is expected to increase demand for e-hailing services in Malaysia, while encouraging the growth of public transport system networks that are coming online.

Mainstay e-hailing operator Uber stated that it is well-positioned to complement the new services by offering last-mile transportation, with 24% of its drivers fares secured last year starting or ending at a light rail transit (LRT) station.

“The LRT extensions and MRT system are actually good for Uber, our riders and driver partners, and the city,” an Uber Malaysia spokesperson told The Malaysian Reserve recently.

He said there is definitely more room to grow in Malaysia, as accorded by this year’s Land Public Transport Commission (SPAD) survey that 80% of Malaysians prefer using ride- sharing services.

Grab Malaysia country head Sean Goh said Malaysians still rely on driving and other forms of public transport to get to LRT and MRT stations, as many of the points are not easily accessible.

“This is where Grab hopes to fill in the gap for first-mile and last-mile travel by providing safe and reliable transport.

“Grab’s main objective is to accommodate the mobility needs of Malaysians during peak-hour traffic,” he said.

He added that demand for point-to-point transportation can increase as much as three times during peak hours.

“We see a growing base of passengers travelling with us from point-to-point, as well as booking rides with us to and from major commuter hubs for their first-mile and last-mile travel,” Goh said.

The second phase of the MRT Sungai Buloh-Kajang Line (SBK Line) commenced operations on July 17 this year, spanning 51km across 19 new stations from Muzium Negara to Kajang.

Costing approximately RM21 billion, the project serves to complement phase one of the MRT system, which began operations in December last year and connected Sungai Buloh to Semantan via 12 stations.

The MRT SBK Line and further LRT extensions in the pipeline could stand to boost the e-hailing industry in the country, which has some 180,000 ride-sharing drivers nationwide.

Presently, Uber — the ride-sharing company based out of San Francisco — operates in 15 cities in Malaysia, while Grab is present in 25.

However, with Malaysia set to be the first to introduce a concrete set of laws to dictate ride-sharing services in the country, it remains unclear how e-hailing providers will adapt their business models to navigate the new territory.

Under amendments to the Land Public Transport Act 2010 and Commercial Vehicles Licensing Board Act 1987, the new laws which were passed in Parliament late last month include a separate driver’s permit, annual vehicle inspections, insurance coverage for passengers and third parties, and medical check-ups.

E-hailing players have been given a one-year grace period to acclimatise to the new regulatory framework, which still needs to be technically enforced in Dewan Negara.

However, both Grab and Uber remain confident of continued sustainability and success in the country.

“As a Malaysian homegrown company, Grab has always and will continue to work closely with the Malaysian government to improve and elevate the standards of our local land public transportation infrastructure and services,” Goh said.

Meanwhile, the Uber spokesperson said the company is confident of positively impacting the people and cities in which they operate.