LESSER options and higher fares.
These are some of the woes that commuters are now worried about, after learning that Grab and Uber are merging their operations in the Philippines and the rest of Southeast Asia.
As a frequent user of both ride-hailing apps, Edwin Allan C. Diaz, a copywriter for a real-estate firm in Taguig, is quite worried about how the merger would affect regular commuters like him, who use the services transport network companies whenever his car is unavailable.
Monday saw Grab Founders Anthony Tan and Tan Hooi Ling announcing the Singapore-based tech giant’s acquisition of Uber’s Southeast Asia operations and assets, namely Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
The transaction was mainly a share swap deal, with Grab taking all of Uber’s shares in Southeast Asia, and Uber receiving a 27.5-percent stake in Grab, which is reflective of the companies’ respective market shares.
With the transaction, operations of Uber in the Philippines will close down by April 8.
“While I use Grab more than Uber because of their promotions, I think having only one provider will be quite limiting, as to options. I’m also a little worried about the future, since they will be the only provider left,” Diaz said in an online exchange.
Grab and Uber are the only ride-hailing apps in the Philippines that allow users to book for a “private” car on a real-time basis.
With the merger, Uber drivers all over Southeast Asia will have to move to the Grab platform. This, according to Brian Cu, the country manager of Grab Philippines, will result in more Grab drivers in the app, thus the company can provide its customers with vehicles much faster.
“With a larger fleet of drivers on our platform, passenger transportation needs will be met faster. Passengers will get to enjoy shorter waiting times, more convenient and affordable rides through one platform,” he said on Monday.
Likewise, Uber users can now enjoy the in-app loyalty program of Grab called GrabRewards, the in-app mobile wallet called GrabPay and use GrabExpress, the parcel service of the Singapore-based tech company.
Driver-partners—technically known as peers—can now expect more passengers in the Grab platform, which, according to Cu, means “more jobs, less waiting time and ultimately higher earning potential.”
The transaction will also have to be made known officially to at least two Philippine regulators: The Land Transportation Franchising and Regulatory Board (LTFRB) and the Philippine Competition Commission.
Aileen B. Lizada, a board member of the franchising body, said the agency still awaits for the manifestation from Uber.
“We will be awaiting the manifestation to be filed by Uber in due time to address the issues pending before the LTFRB,” she said. “Rest assured that we will continue to regulate the fare structure and will monitor for the benefit of the riding public.”
Franchises issued by the government to transport network vehicle services operators—or peers—are generic, meaning they can transfer from one platform to another. Currently, there are about 59,020 TNVS certificates of public conveniences issued by the board all over the Philippines.
“Any new TNC is welcome as long as they are accredited by the LTFRB,” Lizada stated, listing at least five new players seeking to enter the Philippine market: Lag Go, Owto, Hype, Hirna and Micab.
As for the pending fare-hike petitions before the board, Lizada said the government will hear them simultaneously on April 3.
Philippine Competition Commission Chairman Arsenio M. Balisacan noted that the two parties may have to notify the antitrust watchdog of the transaction, citing rules set out under the implementing rules and regulations of the Philippine Competition Act.
“If the parties meet the new threshold, now set at P2 billion for size of transaction and P5 billion for size of party, they should notify at the PCC within 30 days after signing of their definitive agreement,” he said.
Neither Grab nor Uber disclosed how much the transaction in the Philippines was. Reportedly, Uber sold its operations in Southeast Asia to clear its books for its planned initial public offering in the United States.
Grab is one of the most frequently used online-to-offline mobile platforms in Southeast Asia. Over 5 million people use the combined platform daily.
Today, the Grab app has been downloaded onto over 90 million mobile devices, giving passengers access to over 5 million drivers and agents, the region’s largest land-transportation fleet and agent network.
Cu noted his group will continue to follow rules on fare structures and driver activation, and assured the public that his group will continue to improve its services despite the lack of competition in the Philippine market.
“I would like to reassure the government and the public that we continue to work in a collaborative and open manner, as we have done in the past. We will retain our commitment toward quality of service and continue to adhere to regulatory guidelines on activations and pricing,” Cu said.
Despite all his worries, Diaz said he will continue to use the Grab application, as it is a better option in braving the traffic congestion in Metro Manila.
“I will still use it, despite the possible increase in fares, because Grab has rarely failed me as a passenger, and I need it,” he said.