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Much has been said about taxi services in Malaysia, after ride hailing tech companies such as Uber and Grab gave us an much-needed alternative to cabs. Taxi drivers have put up a fight, and some have made the decision to switch camps. Seeing their monopoly crumble, the taxi companies have been hostile, venting frustration at the now legal Uber/Grab and the Land Public Transport Commission (SPAD).

Now, prime minister Datuk Seri Najib Abdul Razak has had his say on the matter, pointing out the problems facing the taxi industry and reiterating the steps and decisions taken by the government to transform it.

The taxi industry plays an important role in first and last mile connectivity, but its service must be upgraded with the latest business practices in line with technological advancements, the PM said on his najibrazak.com blog, reported by Bernama.

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He said that the government had identified several problems which bogged the industry such as an archaic business model, maintenance costs which exceeded income, as well as the quality of drivers and standard of vehicles. Other problems included the absence of centralised monitoring, negative public perception and the challenges of new innovations such as e-hailing.

“We have introduced many initiatives to help the taxi industry resolve these problems and improve the quality of taxi services in line with the Taxi Transformation Plan,” he said, pointing out the Teksi Rakyat 1Malaysia (TR1Ma), Teksi 1Malaysia (TEKS1M), 2015 Fare Review and 2015 Taxi Industry Laboratory initiatives. The latter paved the way for the Taxi Industry Transformation Programme (TITP) that was approved by the cabinet in August.

“It is not just from the monitoring aspects, but also a reshuffle of the business model in line with developments in innovations and technology in order to allow for fairer competition between all providers of national taxi services,” Najib said.

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“Let me stress here that the decision (TITP, which legalises e-hailing players) was made not for the interests of any party. Instead, it was made to encourage entrepreneurship and innovation, allowing for bigger changes in our efforts to transform the taxi service in general,” he added.

The PM said that TITP also includes initiatives to protect the welfare of taxi drivers through introducing uniformed leased contracts, allowing applications for individual taxi licences, increasing the list of cars as taxis with emphasis on safety features, and having KPIs on taxi companies.

In addition, SPAD will rationalise taxi fares by having uniform metered taxi fares, reviewing the coupon system based on distance and not zones, and allowing dynamic fares, which will give the taxi driver the freedom to opt for fares set by the e-hailing services.

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Najib said although SPAD had been appointed to lead the industry transformation, it could only be carried out with the cooperation of all parties.

“The reality is that all changes will surely face many challenges. Especially when we want to transform a service which is long-entrenched and comfortable with the traditional ways. To progress, we have to move in tune with today’s technology and innovations, and we must focus on making our service consumer-friendly and on par with other countries in the world,” he urged.

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