Grab Philippines Situation : Why Is It Hard to Book GrabTaxi or GrabCar?

Like so many of you, I primarily use Grab to get around Mega Manila these days. Hence, I am also well aware of its many advantages and disadvantages.

The advantages are clear. When it works well, hailing a GrabCar or GrabTaxi couldn't be more convenient. You just launch the app, book a ride, and wait for the vehicle to arrive -- often, right outside of the establishment you are in. It's safe and easy; Exactly how we want it.

The disadvantages, on the other hand, are glaring. During peak hours, the rates really spike but worse than that, it can take you around 30 minutes or an hour before you can get a ride -- if you are lucky to even get a ride at all.

I'm sure - like me - you are also wondering what's going on inside Grab Philippines. While we appreciate the wonders of the service, we also want an explanation why it seems to let us down when we need it the most.

Well, a few weeks ago, I got a chance to talk to Grab Philippines' PR representative and she let me in on the real score or the actual situation that the company is facing currently.

Allow me to share with you some relevant details that I learned in our hour-long conversation.

GrabTaxi Philippines

On average, there are 600,000 TNVS riders or clients in Mega Manila. This was true even before Uber Philippines ended its operations in the Philippines and it remains the actual situation until today when Grab has become the sole TNVS giant in our country.

In fact, according to Grab, the number of riders these days can even go as high as 850,000 at peak hours.

GrabCar Philippines

When Uber was still around, there were 43,000 TNVS units - 24,000 via Grab and 19,000 via Uber - servicing all those hundreds of thousands of riders. But when Uber Philippines closed, Grab was left alone to cover the entire demand.

Sure, 11,000 Uber drivers were able to successfully transfer to Grab initially but so many failed to make the transition as they weren't included in "the LTFRB Masterlist" and some Uber drivers opted not to sign up with Grab.

As a result, as of Q1 2018, there are only around 35,000 TNVS cars and taxis, which represent an extremely tight supply facing an overwhelming demand for transport vehicles.

As dictated by law of supply and demand, this - among other factors - causes spike in Grab rates and it's also the primary reason why it's very hard to book GrabTaxi or GrabCar during peak hours. There are just not enough TNVS units to attend to all the riders with no delays.

The truth is, on average, only 37% of passengers can successfully book a ride through the app at first attempt during peak hours, which is not something to smile about.

On Friday, August 17, LTFRB made an announcement that the agency will resume accepting applications for TNVS that are not in the master list by August 24, 2018. While Grab Philippines thinks this is a welcome progress, they still believe that LTFRB must also clean up the master list by removing the dormant drivers from the list and replacing them with new ones who will actually drive and help meet the demand.

Grab Philippines maintains its position that there is just not enough supply of GrabCars and GrabTaxis given the existing demand. To be specific, Grab is currently appealing to LTFRB to increase the common supply base to 80,000 vehicles from the current 65,000. Also, considering the growing demand for ride hailing, it makes sense for regulatory body to make consistent review of the supply and demand situation. LTFRB must commit to its position that it will review the rider situation every after three months to see if there's a need to increase the supply cap.

As a Filipino consumer and rider, I think Grab Philippines and LTFRB must work together harmoniously to ensure that our transportation needs are met through enough TNVS units -- all while making sure that their rates are fair and that they won't aggravate traffic congestion in Mega Manila. For the sake of our country, they have to work hand in hand to deliver the best results for the benefit of Filipinos.

No comments: