Fall of Uber/Comfort would be bad news for Drivers

Bad News has been piling up for Team Uber and Comfort in 2017, its no longer just Uber vs Grab.

But competition between 2 teams- Uber and Comfort vs Grab and the rest of the taxi companies.

Uber has had a rough 2017. It’s founder-CEO and its team of top-level management resigned after reports of toxic work culture and sexual harassment. Locally, Uber and Lion City Rental (LCR) were not spared either. It was discovered that Uber had knowingly leased out a fleet of fire-prone Honda Vezels to Uber Drivers, its car rental company LCR were selling off 500-1000 cars due to lack of hirers and also news of them maybe under investigation for their car purchase agreements.

Comfort has its own share of bad news. They experienced the largest fall in Comfort Delgro Fleet in a year and were the target of Grab promotion to attract Comfort Taxi drivers to join them. It is estimated 3,000 drivers might potential jump to the Grab platform.

Winning year for Grab

While Uber and Comfort take the heat for a challenging 2017, Grab is fast strengthening its hold as the dominant player in Singapore and the region. They raised 2.5 Billion USD of funding in earlier to equip them with financial muscles to wrestle market share from their competitors.

In the latest announcement last week, Grab announced that they will be building the largest car rental fleet to cement its place as the regional leader and go heads on with Lion City Rental for a piece of the rental market share.

The fall of Uber/Comfort would be bad news for Drivers

Currently, both camps are giving out attractive promo code weekly to increase ridership and incentives to drivers to encourage them to drive more for them.

Private-hire drivers who are still expecting to benefit from the massive incentives of the past look set to be disappointed as the good old days of high incentives are likely to be over. Both Uber and Grab have built up a significant pool of drivers to service its platform over the past few years and they are constantly looking to recruit more to replace those who have left. The impact of a lost driver no longer has much impact on either of them as more new drivers sign-up with them every day.

Drivers and Riders would definitely have question themselves on this before, how does Uber/ Grab make money? In actual fact, they do not make money now, the end game to be profitable is to eliminate competition and make people dependent on their platform. The industry is heading towards a monopoly where only a single platform would survive and Grab seems to be winning the race.

If only 1 Dominant platform remains in the market, then the dominant platform needs to be profitable to their investor after spending tons of money to eliminate competition. When they are the only choice available, they do not need to put in a lot of perks to incentivise drivers to drive or offer promo code for riders to take a ride, you would have to take whatever that is available on the table. Ironically, no matter how much one dislike comfort/Uber, it is in the driver interest to support the competition in order to maintain the current status quo.

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Kim Jio
Commander-in-Chief @ Firstlane Swam to Sunny island to escape from the half-brother who ruled with an iron-fist and feed the family with needles or to dogs. Kim is my family name and Jio is my favorite fruit. Screwing around with Uber & Grab since 2014