By Xavier Kong
The issue of regulation, which was said to have been under “discussions with a timeline”, appears to have blown up in the faces of private ride providers Uber and GrabCar. However, KINIBIZ believes this warrants a deeper look beyond the strikes and demonstrations of the taxi driver community.
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The public transport service in the Klang Valley recently saw major upheavals, and, should anyone inquire, much of this can be (and has been) laid at the feet of San Francisco-based ride-sharing app Uber.
Self-identified as a tech company, Uber made its mark over recent years by swinging into a city and disrupting any taxi system that may be in place with what it offers, namely an option for a safe ride, at an affordable price.
However, the disruptive game plan that Uber employs, which involves swooping in and setting up shop with almost no notice, has done nothing to ingratiate the self-identified tech company with the powers that be.
For the sake of background, it should be noted that Uber, along with peer GrabCar, which was started by MyTeksi to provide a similar service, has raised the ire of the taxi driver community in the Klang Valley more than once.
So far…
There have been, to KINIBIZ’s knowledge,more than one memorandum that has been handed to either the Land Public Transport Commission (Spad) or the government by taxi driver groups in the Klang Valley, calling for Uber and GrabCar to be shut down. These were punctuated by strikes and protests by the taxi drivers as well, with the most recent case being that of taxi drivers under the MyTeksi banner having “gone dark”, in effect switching off their devices and not picking up fares who use the app, for seven days in protest against Uber and GrabCar still operating in the streets.
Spad, the authority in charge, had initially given the green light for Uber to operate, with the proviso that the papers of those involved were in order. However, Spad had then ordered for Uber vehicles to be impounded, following the first memorandum offered by the taxi drivers of the Klang Valley in August 2014.
On August 26, 2014, Spad chairman Syed Hamid Albar had mentioned that Spad was of two minds regarding the service Uber provides.
“Uber customer satisfaction was high, and that the service appeared to be picking up customers that taxis left behind. We have received a lot of reports on Uber. Our own officers have gone in to use the service, and ministers also say it is excellent. But the thing is, they are not operating within the system. Nobody should be allowed to operate outside the system when everyone is bound by the law,” said Syed Hamid Albar, noting then that taxi operators had to buck up, as Uber was well-received by the public, and that “customers want the service that they want”.
However, less than a month later, Spad had made up its mind, and began crackdowns on those who operated under the banner of Uber and GrabCar, which had begun operations in May 2014. Agreeing with the term “kereta sapu” that was used by taxi drivers to describe the vehicles under Uber’s or GrabCar’s banners, the Spad chairman had proclaimed them illegal, and in violation of the Land Public Transport Act 2010.
The Land Public Transport Act 2010 stipulates that vehicles registered under hire-and-drive are not allowed to offer taxi or limousine services, and drivers without a Public Service Vehicle (PSV) licence are not permitted to offer such services.
Uber had then engaged the commission, stating that they had always been open to talks with the authorities wherever they set up. Unfortunately, the last heard of this was that there would be an “informal meeting” between Spad and Uber on Oct 10, 2014.
The closest thing to this was when Uber, in conjunction with Volkswagen Malaysia, announced their Charity Drive with the Stars event on Dec 12, 2014, which saw a reminder from Spad regarding the service provided by Uber.
“Spad welcomes the noble intentions of this charitable drive, however all parties must verify with Spad to determine the legality of such programmes, which involved any use of land public transport,” noted Spad’s statement, which said that the drivers for that event had to have the required public service licence, and that the vehicles used had to be registered with Spad with proper insurance coverage for the protection of fare paying passengers.
Since then, there has been no news regarding the cooperation between Uber and Spad, with any inquiries to Uber netting the response that “there is a timeline, but we cannot disclose this”.
Another memorandum was then sent to the government by the Malaysian Taxi Drivers’ Transformation Association (PERS1M) on February 25th earlier this year, with the association claiming that Spad was not doing enough to transform the Malaysian taxi industry. At the same time, PERS1M also claimed that Klang Valley taxi drivers’ incomes have fallen by 50-70% due to the existence of Uber and GrabCar.
However, contrary to claims, Spad had not been idle.The commission had continued clamping down on the driver-partners of the ride-sharing apps, impounding a number of vehicles through sting operations, where their officers would use the app masquerading as a customer.
“From last October to now (March 22, 2015), we have impounded 28 cars offering illegal transport services to the public. Of the 28, 11 are privately owned. These 28 vehicles committed 53 offences under the Spad Act 2010 and we have sought court orders for the government to claim the vehicles so they can be auctioned,” said Spad enforcement chief Che Hasni Che Ahmad, who also noted that Uber had exploited the car-for-hire permits issued to car rental or car leasing companies.
And now…
However, this did not seem to be enough for the taxi drivers, which led to the Metered Taxi Drivers Action Committee (Badan Bertindak Pemandu Teksi Bermeter, or BBPTB) submitting another memorandum to the government, specifically to Shah Alam Member of Parliament Khalid Abdul Samad.
Claiming that Uber’s and GrabCar’s services were threatening taxi drivers’ livelihoods, BBPTB chairman Amran Jan also claimed that the country was being overrun by illegal taxis, and that there are Uber vehicles that are not covered by the appropriate insurance.
This was refuted by Uber, who noted that there was a third-party liability policy, with coverage of up to RM1 million, which covers from when a trip is accepted by a driver-partner, until the end of the trip. It was also noted that there were no exceptions, and that every driver and rider was covered under that policy.
Just recently, on July 13, 2015, there was a protest outside GrabCar’s office, with about 100 taxi drivers under the MyTeksi banner gathering to seek a response to yet another memorandum that had been sent to GrabCar by PERS1M, seeking an answer to what they feel is a betrayal by the company.
“MyTeksi disappointed us when they called those of us here today trespassers, when they are the actual trespassers as they founded GrabCar,” said Kamarudin Mohd Hussain, the representative of the taxi drivers assembled for the protest, adding that, should no action be taken regarding GrabCar, the taxi drivers may have to resort to more aggressive means.
MyTeksi responded to the gathering with a promise that it was open for discussions involving taxi drivers, MyTeksi, the Transport Ministry and the Spad, while examining the laws covering ridesharing and taxis. However, this failed to appease the taxi drivers, who filed police reports.
“We still respect the law and don’t want to take the law into our own hands. We will exhaust all avenues. We will take the matter to court,” said Persatuan Pemandu Teksi Subang Jaya (PPTSJ) secretary Mathavan Subramaniam.
In the next part of this series, KINIBIZ examines the responses of Uber and GrabCar, and wonders if Spad would be willing to accept change.
Tomorrow: A step forward, two steps back?
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