Photo of TransCab from Lim Yaohui Straits Times

Traditional taxi corporations are bleeding profits and losing drivers faster than ever due to the entry of Uber and Grab in 2013. The number of drivers using the apps ballooned nearly 70 times in the 4 years since inception to 41,297 drivers. This number is one and a half times the number of taxi drivers at 26,476.

According to statistics provided by the Land Transport Authority, the number of taxi vocational license holders peaked in March 2014 at 100,378 – after recording yearly increase of about 3,000 valid license holders each year. Since the 2013 entry of Uber and Grab, the vacancy rate of unhired taxi vehicles have also soar to at least above 10% at an estimated 3,000 idle taxi vehicles.

The technology disruption is however welcomed by both drivers and commuters. As compared to the days before the entry of Uber and Grab, complaints on lack of taxis during peak hours today is unheard of. Market demand has been fully met and at a lower cost to both commuters and drivers. This is done so by cutting out the money-grubbing rental system designed by the LTA and taxi companies, where over 35% of an average taxi driver’s earnings goes to paying exorbitant rental as compared to only about 20% of an Uber driver’s earnings going to the middle man.

Right-wing academic interviewed by state propaganda media Straits Times however defended the taxi corporations and lambasted Uber and Grab. NUS “transport expert” Lee Der-Hong slammed Uber and Grab’s business model as “unsustainable”:

“If at the end, private-hire operators admit that their business practice is unsustainable, the taxi industry in Singapore would have been affected negatively.”

Another right-wing academic from Nanyang Business School, Associate Professor Zafar Momin, told the state media that Grab and Uber drivers are just part-timers and so they are likely to lose to full-time taxi drivers:

“The explosive growth in the private-hire population is not a good indicator of how well the industry is doing. Taxis are likely to clock comparatively more hours per week and spend more time on the road. In fact, many drivers of private-hire vehicles are part-timers and enter the profession to secure access to a car which they otherwise would not be able to afford. Second, one should look at the number of customer trips or rides provided. Again, taxis are more likely to win here as well, despite having fewer vehicles.”

The last right-wing academic interviewed by Straits Times, Singapore University of Social Sciences transport researcher Park Byung Joon, said:

“As Uber and Grab are dishing out “a lot of promotions and incentives to drivers and commuters”, they would find the private-car hire services a better deal. But in the long run, this is definitely not sustainable.”