Earlier this week, the transport ministry said it had instructed certain ride-hailing companies to explain and clarify the alleged increase in fares, following numerous complaints from users about the matter. Having met with the ride-hailing providers to find out why this was happening, the ministry said that the increase in ride-hailing fares is due to a couple of factors.
“From the discussion, it is clear that there are two main factors that have led to this surge in ride-hailing fares; a supply-and-demand imbalance and high traffic volume leading to longer travel times,” said transport minister Datuk Seri Dr Wee Ka Siong.
The first is a lack of drivers. “Some ride-hailing companies have seen their number of registered drivers drop by over 30% compared to pre-pandemic times,” he said via a statement. This has indirectly led to longer than expected waiting times for a vehicle in some places.
There was also a sudden increase in the demand for these services following the easing of restrictions as of April 1. “Daily life seems to have returned to some normalcy and as expected, there is more traffic on the road,” he said, stating that increased economic activities has contributed to reasons for the fare rise.
The combination of these two factors have affected the service quality of ride-hailing. “These factors have the most effect on the fare algorithms employed by the ride-hailing operators, which account for many factors including distance, traffic volume, weather patterns as well as market supply and demand,” he explained.
Fares – notably those of Grab – were recently reported to have increased by up to 400% during peak hours, sparking discontent from consumers who called for government intervention. Taxi services have apparently benefited from the increased ride-hailing fares – last week, the Combined Taxi Across Malaysia association said that the number of users opting for taxis instead of ride-hailing has gone up by 40% of late due to the latter’s expensive fares during rush hours.
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#Fare Manipulation.
“Transport Minister told eHailing providers to explain price hike, will not compromise fare manipulation”
So, Datuk Seri Wee, any solution?
The only real solution is to let market force decide.
anyone that takes e-hailing will know that due to demand and supply, the fares will go up. But Datuk Seri Dr Wee Ka Siong didn’t mention is it justified that the price go up by 400%? on what basis the extremely steep hike? what is the system’s algorithm to calculate the fare hike up to 400%?
Less driver. Peak hours. Sure hike. Same like taking flight. Simple.
How is 400% price hike simple?
the reason for the hike is simple enough to understand. The mechanism and quantum of the hike are not so simple….
Wee Wee didnt deep dive into the problem. Got a convenient enough excuse to tell the public and thought the job is done…
Why should he need to dive deep into their algorithm? There is no regulation so no need for him to do so. But from his highlight we know that Grab pricing structure involves number of drivers, demand, and peak period rating. So if we want more reasonable fares it is a simple matter of taking Grab when there are plentiful drivers around, less customers hailing them, and do that during off peak hours. That oso Dr Wee mau ajar u ke?
As long as the price hike goes to the drivers and not the platform; I will fully support it. I am not an e-hailing driver, but try thinking from their perspective. Would you be willing to spare time and cost sitting in traffic; just to earn a small, pitiful amount? What would then be the incentive for drivers to do it in the first place? Can’t expect them to do social service when the economy has forced them to be a grab driver in the first place.
I believe another reason is required psv license whereby lots of part timers don’t have the time to go through all those steps to get the it. Therefore forced out of the driver app and not able to take requests anymore. I was a part timer myself. It’s sad.