Is Uber taking us for a ride?POSTED BY CBT Team ON 23 September 2014
I refer to “JPJ bans Uber service” (CBT, Sep 22) and wish to commend the Road Transport Department (JPJ) for giving notice to crackdown illegal taxi service from Oct 1.
The exercise is timely as an increasing number of motorists are moonlighting using their private cars to pick up fare-paying passengers using the Uber phone app.
The public is enticed by tantalising rates charged by Uber. Compared to budget taxis, the UberX fares are 50%, 63% and 70% lower for starting fare, distance and time, respectively.
Uber’s website listed Honda City as one of the UberX models in Malaysia. The new car price for this model is about 68% higher than the Proton Persona for private car registration.
Budget taxis using Proton Persona are exempted from excise duty and run on natural gas for vehicles (NGV) which is only 68 sen per litre compared to RM2.10 for petrol.
Budget taxi fares were last revised more than five years ago and a fair rate is to increase them by 44% for distance and 40% for time.
As such, there is something sinister for any party to offer rates that are 50% to 70% lower than regulated when equitable fares should be 40% to 44% higher.
Uber’s South-East Asia regional general manager Mike Brown described JPJ’s action as a clear attempt to protect the taxi industry.
I would expect government agencies and regulators to do nothing less as their role is to protect all stakeholders, including taxi companies, cabbies and passengers.
It was because of doing too little too late and lack of enforcement that have led to the poor taxi service in this country.
However, those who needed excellent taxi services are already getting it by using one of the many phone apps to book taxis.
Uber is different from other taxi apps as customers who signed up need a credit card account for payment to be automatically deducted.
The drivers will normally receive 80% of the fare with Uber retaining 20% as commission.
As such, it would make better sense for Uber to charge 50% above the regulated fares for budget taxis, maintain the 20% commission and allow taxi drivers to earn more.
However, this is unlikely to happen as they have huge funding and are capable of wiping out the competition, with no regard of the livelihood of cabbies and the welfare of their families.
When the public is dependent on Uber for taxi service, fares will no longer be subsidised but would be raised several fold to reflect actual cost.
Sadly, many Malaysians are gullible to welcome Uber as a messiah without realising that they are being taken for a ride.
Luckily, they are not in the team negotiating the Trans-Pacific Partnership Agreement as they could easily be lulled into a false sense of security.
It is only ethical that we pay fairly for services rendered to us, just as we wish to be reasonably paid for our work.
It is time for those using private cars for taxi service to heed JPJ’s warning or find themselves two years behind bars after coughing out RM10,000 and the car confiscated while Uber continues to operate safely in cyberspace.