Transportation

ComfortDelGro Invests in Uber – How Will Singaporeans Be Affected?

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Joanne Poh

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Missed your last train home? Woke up late for work? MRT broke down again? You have two options: try your darnest to get a taxi, or order an Uber/Grab and pray that surge pricing doesn’t kill you.

Very soon, it’s going to be a lot easier to decide which of the two options to pick.

ComfortDelGro has bought a majority stake in Uber’s car rental subsidiary, Lion City Holdings. They will own 51% of the company’s stock, while Uber will retain the remaining 49%.

Private car hire businesses Uber and Grab have been killing ComfortDelGro’s business, which has surely served as part of their motivation for acquiring such a large stake in their competitor’s car rental business.

Whether this will do much good in helping to revive the ailing taxi industry in Singapore is debatable. But Singaporeans can expect to see some changes in the near future as ComfortDelGro and Lion City Rental combine forces in a joint venture.

It’s too early to tell exactly how this will pan out, but in the near-term Singaporeans might be able to expect the following.

 

You will be able to book taxi rides on Uber’s app

One of the developments that has already been announced is that taxi drivers will soon be able to use the Uber mobile app to receive ride requests.

That means that commuters will have the option to choose between booking an Uber or a taxi on the app.

This should enable commuters to check Uber’s estimated pricing before deciding if it would be cheaper to get a taxi. During price surges, they can simply toggle to the UberTaxi booking option on the app and order a cab instead.

Both ComfortDelGro and Uber are probably hoping that this will tip the scales in the Uber app’s favour, which is facing fierce competition from Grab, whose private car hire prices tend to be slightly lower.

 

Taking taxis might get a little cheaper due to vouchers and incentives

Despite the fact that taking Uber is only cheaper than taxis some of the time, some Singaporeans have completely stopped taking taxis and converted to taking private hire cars all the time.

That could be partly because Uber and Grab constantly dole out promotions that lower the cost for commuters. Uber’s promo codes allow you to enjoy perks like xx% or $x off a certain number of rides. The promos that knock a dollar amount off your rides are a particularly strong incentive to those who want to take short trips.

They’ve also been seeking out tie-ups with credit cards. For instance, the Citi Cash Back Card now offers 8% cash rebates on Uber rides.

Once taxi booking is integrated into the Uber app, commuters will hopefully be able to benefit from taxi-related promos, too.

 

The ailing taxi industry might get a bit of a boost

In the long run, it is unlikely the taxi industry will be able to keep up with private hire cars unless taxi companies adjust their prices downwards.

But in the short-term, the ComfortDelGro-Uber partnership might slow the decline of the ailing taxi industry a little by raising ease of booking and offering customers incentives to consider taking cabs.

Will you start using taxis more when UberTaxi is available? Tell us why or why not in the comments!

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Joanne Poh

In my previous life, I was a property lawyer who spent most of my time struggling to get out of bed or stuck in peak hour traffic. These days, as a freelance commercial writer, I work in bed, on the beach, in parks and at cafes, all while being really frugal. I like helping other people save money so they can stop living lives they don't like.