Tada’s ex­pan­sion plan hits snag on gov’t op­po­si­tion

The Korea Times - - BUSINESS - By Jun Ji-hye [email protected]­re­atimes.co.kr

Rental van-hail­ing ser­vice Tada’s ex­pan­sion plan is fac­ing hur­dles due to the trans­port min­istry ex­press­ing con­cerns that the plan could lead to more con­flicts with taxi driv­ers.

VCNC, which op­er­ates the Tada ser­vice, an­nounced a plan, Mon­day, to ex­pand the num­ber of its vans to 10,000 from the cur­rent 1,400 and its driv­ers to 50,000 from the cur­rent 9,000 by next year.

VCNC is a sub­sidiary of car-shar­ing ser­vice SoCar.

VCNC CEO Park Jae-uk said the Tada ser­vice, which has been op­er­at­ing in Seoul and the sur­round­ing metropoli­tan area, will be ex­panded na­tion­wide.

“There has been grow­ing de­mand from Bu­san, Daegu and other ar­eas,” he said dur­ing a me­dia con­fer­ence to cel­e­brate the first an­niver­sary of Tada’s launch.

The Min­istry of Land, In­fra­struc­ture and Trans­port re­leased a state­ment af­ter this an­nounce­ment, say­ing the mo­bil­ity plat­form provider’s plan was “in­ap­pro­pri­ate” as it could ig­nite con­tro­versy over such ser­vices and again pro­voke con­flicts with taxi driv­ers at a time when the govern­ment has been work­ing on mea­sures to set­tle th­ese and pro­mote mu­tual growth be­tween the con­ven­tional taxi in­dus­try and new plat­form com­pa­nies.

Tada, which uses 11-seat rental Kia Car­ni­val ve­hi­cles and out­sourced driv­ers, has ex­panded its pres­ence swiftly over the past year de­spite protests from taxi driv­ers, boast­ing over 1.25 mil­lion users.

While taxi unions have called the ser­vice “il­le­gal,” VCNC has stressed it of­fers le­gal ser­vices, cit­ing an en­force­ment or­di­nance of the Pas­sen­ger Trans­port Ser­vice Act, which per­mits com­pa­nies to of­fer driv­ers when us­ing rental ve­hi­cles with 11 seats or more.

Amid in­ten­si­fy­ing con­flicts be­tween con­ven­tional taxi ser­vice providers and new mo­bil­ity plat­form op­er­a­tors, the trans­port min­istry an­nounced a set of pro­pos­als in July to set­tle the dis­cord, say­ing it will en­act leg­isla­tive mea­sures by the end of the year.

The mea­sures pro­posed by the min­istry in­cluded the govern­ment’s con­trol of the num­ber of taxi li­censes that can be pur­chased by mo­bil­ity plat­form providers.

Dur­ing Mon­day’s press con­fer­ence, VCNC CEO Park ex­pressed his dis­sat­is­fac­tion with the mea­sures, say­ing the core of the plat­form busi­ness is the flex­i­bil­ity to sup­ply in ac­cor­dance with de­mand.

“The govern­ment has moved to cre­ate laws call­ing them in­no­va­tive mea­sures, but there is great pos­si­bil­ity for such mea­sures to be­come reg­u­la­tions that block new busi­nesses,” he said. “More suf­fi­cient dis­cus­sion will be nec­es­sary.”

But the min­istry once again stressed that ad­di­tional ser­vices of mo­bil­ity plat­form providers should be cre­ated within its new mea­sures.

Cour­tesy of VCNC

VCNC CEO Park Jae-uk an­nounces a plan to ex­pand rental van-hail­ing ser­vice Tada dur­ing a me­dia con­fer­ence in Seoul, Mon­day.

Newspapers in English

Newspapers from Korea, Republic

© PressReader. All rights reserved.