One of the major factors that then-Davao City Mayor Rodrigo Duterte was able to win the nod of 16 million Filipinos in the 2016 presidential elections was his promise to solve in three months the traffic woes of Metro Manila.
Such an audacious claim—bolstered by his image as a swashbuckling crime buster in his hometown, and replete with theatrics rivaling those of the late director and screen writer Sam Peckinpah’s explicit depiction of action and violence—must have convinced 38 percent of Filipino voters that they had finally elected the “right man for the job.” Tired and weary from their hellish, daily commute, they trooped to the polling precincts to hoist the fist salute for the controversial Davao City mayor, never mind if the economy was at its historic high, courtesy of the previous administration.
Almost three years have passed, Edsa remains a humongous parking lot and high-blood trigger. What’s worse, the yet-to-be-seen improved traffic situation is just one of many campaign promises that President Duterte has yet to fulfill.
His “best and brightest” in both the transportation and traffic management agencies have tried many palliative solutions to no avail. The latest, which the Metropolitan Manila Development Authority discontinued due to public backlash, was the so-called high-occupancy vehicle traffic scheme where a vehicle with only its driver as occupant is banned from navigating Edsa from 7 to 10 a.m., and from 6 to 9 p.m. The HOV’s main purpose was to supposedly encourage carpooling.
But wasn’t this the very concept that the app-based transportation network vehicle services (TNVS) companies tried to introduce as a sustainable way of decongesting traffic? Sadly, the government has made doing business for Uber, Grab and Wunder, among others, excruciatingly difficult. Uber is dead, and Grab is slowly slipping away.
I can’t help but suspect that the Land Transportation Franchising and Regulatory Board (LTFRB) played favorites here. For one, TNVS ate up a huge chunk of the business that fleets of dilapidated and perilous taxis owned by powerful people with deep connections to government used to enjoy. Harsh regulations and fines hounded TNVS. The concept of carpooling died a natural death.
The decreasing number of TNVS cars in Metro Manila has resulted in a serious supply crisis. More and more passengers are waiting for longer hours and, worse, getting stranded on the road because they could not get a ride.
The Philippines is said to have the lowest allocation rate in Southeast Asia. Our TNVS app providers’ ability to allocate cars within the first few tries is down to 40 percent, the lowest in the region. This means that vehicles are allocated to only four out of 10 passengers trying to book a ride.
Due to the lack of authorized drivers, the matching of passenger-and-driver trips is being compromised. Average pickup time (waiting time from booking confirmation to actual pickup of passengers) has increased in July to eight minutes from a January-to-March average of seven minutes.
With a severe undersupply of vehicles—only around 35,000 available cars to serve about 600,000 daily passengers’ booking requests—TNVS providers could no longer manage the demand overflow by themselves.
In January 2018 the LTFRB ordered a common supply base of 45,000 TNVS cars, less than a third of the 125,000, which were in operation at that time. The following month, the cap was raised to 65,000. Around the same time, LTFRB, with the support of an independent party and data from Uber and Grab, created a list of 55,000 vehicles, which is currently recognized as the official master list in the processing of Certificates of Public Convenience (CPCs) and Provisional Authority permits (PAs). Since then, only 42,000 active vehicles were left in the system. Out of this number, merely 83 percent or 35,000 vehicles are active daily.
When Uber pulled out of the Philippines in March 2018, an estimated 50,000 vehicles were active, with about 43,000 of them active daily (24,000 from Grab, and 19,000 from Uber). After the pullout, only around 11,000 Uber cars transferred to Grab. It was discovered during the transition that around 6,000 active Uber drivers were not part of LTRFB’s audited master list of TNVS drivers, and by LTFRB decision, were neither allowed to transfer to Grab nor to other transportation network companies (TNCs). As a result, the daily active base went down to 35,000 drivers.
Aside from the fact that the LTFRB is limiting the number of partner vehicles that can be granted PAs or CPCs, there are fewer TNVS drivers vehicles now because of LTFRB’s move to suspend Grab’s P2-per-minute travel-time charge since April this year, which ultimately reduced the incomes of its partner vehicles/drivers.
TNVS operators maintain that the P2-per-minute travel-time charge was legal since it was imposed before the Department of Transportation issued Department Order No. 2017-011 or the Omnibus Franchising Guidelines for Public Utility Vehicles on June 19, 2017, which authorizes the LTFRB to determine the fare structure of TNVS. Still, LTFRB Chairman Martin B. Delgra III insists on imposing a P10-million fine on Grab. The latest DOTR DO 2018 now gives LTFRB full authority to regulate TNVS fares.
The suspension of the P2-per-minute charge has greatly affected driver income and reduced the number of online drivers by 6 percent.
Aside from allowing more vehicles to operate as TNVS partners, LTFRB should start realizing that the public needs and demands this service. These vehicles do not have fixed routes, and can therefore use the inner streets of Metro Manila, thereby decongesting major thoroughfares. Unless our government can assure both commuters and motorists of an efficient mass-transport system and implement no-nonsense and effective solutions to our traffic woes, it should give the riding public more options.
Grab and TNCs have been asking LTFRB to open the remaining slots to increase the supply of cars, but the agency has opted to not take immediate action. LTFRB also does not have a structural mechanism to replace inactive and dormant drivers in their current master list.
Why is the LTFRB focusing on other matters, such as pricing, when the real problem is supply? Following the imposition of a P10-million fine on Grab, the LTFRB is also questioning Hype and OWTO about pricing.
Overregulation has already forced Uber out of the Philippines. To quote a proverb in Farsi, “When you can open a knot with your hands, you don’t have to open it with your teeth!” The solution is simple. The public wants these TNCs to continue operating. The more accredited vehicles and drivers there are, the better for the customers.
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