Grab Eyes Reliable Driver, Vehicle Supply With Taxi Move: Experts

Transport economist says cabbies stay in trade longer than private-hire car drivers

- Lee Nian Tjoe Senior Transport Correspondent and Esther Loi

Grab's foray into the taxi market is a means for it to reliably increase its driver and vehicle supply, but it needs to put more than the minimum 800 taxis on the roads to meaningfully increase availability for passengers, experts said.

On April 2, GrabCab - a subsidiary of Grab's rental arm GrabRentals - was awarded a 10-year street-hail operator licence effective on April 9. It will become Singapore's sixth taxi operator.

Associate Professor Walter Theseira, a transport economist at the Singapore University of Social Sciences, said Grab's entry into the taxi market is a way to secure a reliable supply of drivers.

Taxi drivers, he said, are more committed to fulfilling their shifts compared with private-hire car drivers, who tend to be engaged in other activities. Cabbies generally tend to stay in the trade longer than those driving private-hire cars, he said.

While Grab said the move in part positions it to cater to consumers who prefer street-hail rides, Prof Theseira believes the company is "not interested in street hail (rides) under the current business model, where platforms and taxi operators do not earn any commission".

At present, Grab earns a commission from its drivers for each ride booked via its app.

Dr Timothy Wong, an economist at the National University of Singapore, said Grab may be entering the market to secure a larger pool of vehicles that it will be able to use across both its ride-hailing and street-hailing services.