How technology is changing the face of Yangon’s taxi industry
UBER and Grab, the two latest entrants to the Yangon taxi industry, are upping their game in a battle for market share in Myanmar. As they attempt to outdo each other in the race to dominate Yangon’s taxi market, it is local drivers and passengers who stand to benefit.
There are approximately 80,000 taxis in Yangon, where the population stands at around 5 million. Due to chronic traffic congestion, Uber and Grab must partner with local taxi drivers to provide ride-hailing services to passengers. This differs from their strategy in other countries, where private car drivers using the apps compete directly with the taxi industry.
In Yangon, it’s a tricky game of balance. On one hand, with the market limited to the number of existing taxis, Uber and Grab must use low fares to draw passengers. On the other hand, the fares must be high enough to attract more drivers on board.
Passenger promos Uber is playing the game by releasing a slew of generous discounts to attract customers. Since launching in Yangon in May, it has been offering fare promotions to raise the volume of passengers using its app and capture more market share.
“Looking at not just Yangon, but Myanmar as a whole, there is a great opportunity for us because we believe we can be the solution to moving all these people from point A to point B. We think that we can play a huge part in helping to relieve traffic congestion, including in Yangon,” said Chan Park, South East Asia General Manager for Uber.
Without the promotions however, Uber’s fares are actually higher than standard taxi fares to attract more drivers. But many passengers have said they’ll stop using the app after promotions end.
Meanwhile, Uber also faces stiff competition from Grab. Since its debut here in March, the number of Grab drivers has risen to 5,000 from just 40 and most say they have seen a 30 per cent improvement in average monthly income, data provided by a Grab spokesperson shows.
Service strategy In that light, the challenge for Uber as well as Grab boils down to retaining drivers and passengers with good service. Uber’s plan is to focus on passengers.
“There are many people living in Yangon and our goal is to educate and show them that our platform is a solution to making their lives easier. Our primary goal is to focus on picking up passengers at a specific time and place and get them on their way as quickly as possible,” Mr Chan said.
Passengers can also expect a certain level of comfort from Uber taxis. “In Myanmar, you can’t rely on every taxi to have seatbelts or a functioning air conditioner. We will make sure users of Uber get into vehicles that are safe and comfortable. Over time, we are sure we will receive positive feedback from both passengers and drivers.”
Grab’s strategy is a little different. It plans to focus on empowering drivers. On July 21, Grab introduced a new app which includes the Zawgyi and Unicode font system for drivers and passengers to communicate easily. It also launched the Grabchat message system, which translates English to the local language and vice versa.
That will help decrease the number of cancelled trips by passengers owing to communication breakdowns and help drivers earn more income.
Meanwhile, all Grab drivers now have access to banking and financial services through its partnerships with CB Bank and Wave Money. Passengers will also enjoy safe, high-quality fixed fare taxi rides, said Hooi Ling Tan, Cofounder of Grab.
Connectivity is also key. ‘’At first, our drivers faced problems with mobile phone connectivity. So we cooperated with Telenor to provide sufficient data to our drivers,” Grab spokeperson Zay Yar Min said.
“Our next phase of expansion in Myanmar includes investments in making the Grab app more userfriendly and a new Driver Care Programme to grow driver incomes in a sustainable manner while up-skilling them,” a Grab spokesperson said.
What’s clear is the ride-hailing technology will benefit the lifestyles of both passengers and taxi drivers in Yangon. And as both Uber and Grab as well as local ride-hailing apps Oway and Hello Cab up their game in the race for market share, the taxi industry in Yangon should evolve for the better.