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​Ride-hailing apps compete to win drivers in Vietnam

​Ride-hailing apps compete to win drivers in Vietnam

Wednesday, August 15, 2018, 16:11 GMT+7

Ride-hailing apps in Vietnam are racing to win over drivers and passengers, as more and more players have jumped into the Southeast Asian country’s market.

To date, Vietnam has about ten domestically developed apps to compete with the now-dominant player Grab, while Go-Jek from Indonesia has officially debuted earlier this month, under the local brand of Go-Viet.

It means that the ride-hailing sector is becoming busier and securing brand loyalty from both customers and drivers is one of the biggest hurdles facing industry players.

Apps are competing with one another to win over customers, with crucial factors determining their advantage including the number of drivers, the speed of services and the advertising potential on the streets.

Tech-based drivers are technically ‘independent contractors’ with the apps, so they are not tied to just one company. The more apps they are on, the more money will come to their pockets.

Bonanza for drivers

According to Thanh Hung, a two-wheel contractor driving for both Grab and Go-Viet, there are 500 drivers registering for the latter every day, many of which are also GrabBike drivers.

Signing up for Go-Viet since Saturday, Hung still wears the Grab’s green uniform to pick up customer on Sunday.

"The jacket [Go-Viet gave him] was so small, [while] too many drivers came to register, so the company could not prepare the uniform in time," Hung explained.

After its test phase in July, Go-Viet officially operated in Ho Chi Minh City with the rock-bottom offer of VND5,000 (US$0.22) per under-eight-kilometer trip.

The perk for drivers is that they still receive the full payment of actual distance, which is even doubled during high-demand hours.

"I made VND800,000 [$34.4] driving for Go-Viet for a full day and a half, while the same amount of time [driving] for Grab only earned me VND500,000 [$21.5],” said Hung.

“[Go-Viet] is new, it gave drivers tax and commission exemption for the first six months, so I have to take advantage [of the opportunity],” Hung added.

"I prefer Go-Viet when accepting trips in urban areas, while in uptown districts such as Binh Chanh and Tan Phu, I open Grab," said Nhan Quan, a tech-based motorbike taxi driver wearing Grab jacket but having Go-Viet’s helmet on his head.

"Boarding a bus costs VND6,000 [$0.26] per turn, this one [Go-Viet] charges VND5,000 [per trip], so many people in outskirt districts choose it to enter the city’s downtown areas,” Quan elaborated.

“There are days I was able to finish 20 trips for Go-Viet," he added.

Pitch to drivers

Unlike other ride-booking apps, Aber, which was developed by a German foundation and officially launched on June 5, charges fixed management fee on drivers, corresponding to the driver's monthly gross income.

“This fee is deducted every month [from the drivers’ revenue]," Huynh Le Phu Phong, managing Director of Aber said during the inauguration of the platform.

But the toughest battle in the market now is probably the race to retain drivers between Grab and Go-Viet.

The flood of drivers rushing to Go-Viet is in line with its CEO and co-founder Nguyen Vu Duc’s statement in June, mentioning the goal of drawing "tens of thousands of drivers" to join the platform.

According to Vu Hoang Tam, a mobile application specialist participating in the trial launch of Go-Viet, the firm has the advantage that a large number of drivers, who did not like or failed to join Grab’s network due to some unknown reasons, are now available for the Indonesian app’s recruitment.

Tam was one of the founding members of GrabBike in Vietnam.

Despite that, Nguyen Thu An, media director of Grab Vietnam made no comment on its rival’s strategy of driver recruitment.

The director, on the other hand, emphasized that Grab has just launched the program "Get back five percent of revenue per week" for GrabBike, GrabBike Premium and GrabExpress drivers in Ho Chi Minh City starting from August 6.

While Grab used to pour money into promotions for users during the competition with Uber, the tech-based company now spends heavily on utilities and upgrading policies and service infrastructure.

Particularly, Grab is planning to build more than 100 rest stations with Wi-fi, coffee and even free car wash in Ho Chi Minh City and Hanoi for its drivers, according to Grab Vietnam’s CEO Jerry Lim.

The drivers will also be able to enjoy a bonus when picking up passengers from far distances, and no penalty when they cancel bookings by customers who do not appear after five minutes of waiting.

Grab also improves its map system to avoid possible fines for drivers when carrying passengers through forbidden routes or one-way streets.

Photo: A Mai Linh Bike driver wearing a local ride-booking application Vato helmets asks a Go-Viet driver for directions in Ho Chi Minh City.

Bao Anh / Tuoi Tre News


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