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Ride-hailing drivers struggle as incomes plummet in Vietnam

Ride-hailing drivers struggle as incomes plummet in Vietnam

Saturday, November 18, 2023, 09:20 GMT+7
Ride-hailing drivers struggle as incomes plummet in Vietnam
Ride-hailing companies in Vietnam have continuously levied various surcharges on customers and drivers. Photo: Quang Dinh / Tuoi Tre

Vietnamese ride-hailing drivers are now struggling to make ends meet as they are seeing a sharp decline in their earnings.

They rely on a stream of passengers for their daily incomes but are experiencing a slump given the rising number of drivers.

Meanwhile, restaurants and eateries are seeking to reduce their dependence on delivery apps, leaving drivers with fewer orders.

Many ride-hailing drivers, especially those of four-wheel vehicles, said they intended to sell their vehicles and find other jobs although they had earlier quit stable jobs to become ride-hailing drivers with a hope of better incomes.

Parking his motorbike on Nguyen Thi Minh Khai Street in District 1, Ho Chi Minh City, H.V.Hieu, a driver of the Grab ride-hailing app, did not have a customer for an hour. He has seen his income halved since early this year.

“I could easily earn VND700,000-800,000 [US$28.9-33], even VND1 million [$41.3] with eight working hours per day, but I can now only yield VND300,000-400,000 [$12.4-16.5], even VND200,000 [$8.3] per day, while my working time increases to 13-14 hours a day,” Hieu said, adding that he would find an additional job instead of working as a full-time Grab driver.

T.K., a ride-hailing driver working in the Tan Son Nhat International Airport area in Tan Binh District, Ho Chi Minh City, said that a commission rate of 25 percent, including taxes, caused many difficulties for drivers.

Customers at the airport often take vehicles at the airport’s gates instead of using apps. Therefore, many drivers often deal with customers that they will offer services without using apps with the same prices in apps to avoid paying the commission.

However, this is just a temporary solution.

Nguyen Van Tuyen, a 23-year-old driver, said his income had fallen by one third, so he has to cut his expenses.

Ride-hailing drivers and customers are subject to various fees, such as app usage, carbon neutral, and insurance fees. 

Drivers also have to pay for uniforms and helmets and make a deposit of VND1.5-3 million ($62-124) for opening and maintaining their accounts.

A representative of a ride-hailing firm said ride-hailing services’ nature is sharing vehicles so that drivers can earn extra money. When many people consider it as their main career, it is difficult to ensure a stable income with the market saturation. 

That is why app operators have launched many services like goods delivery, besides passenger transport, to improve drivers’ incomes, the representative added.

In the context of the global economic downturn, ride-hailing firms are not outsiders in the job of optimizing and seeking more revenue sources, said Le Trung Dung, a representative of the national e-commerce project management board of the Ministry of Industry and Trade’s Vietnam E-commerce and Digital Economy Agency.

As a result, they have diversified their services. However, many of them have abused legal loopholes to offer insurance services without registering with the local authorities and collecting surcharges, Dung noted, adding that these operations should be monitored and adjusted in the future.

With the increasing number of ride-hailing drivers and the involvement of electric vehicle companies, service prices will definitely fall to improve competitiveness.

However, if ride-hailing companies further reduce fares, it will exert a significant impact on the passenger transport sector, Dung added.

According to Dung, ride-hailing services cost 10-30 percent lower than traditional transport services. However, they are sometimes two to three times more expensive than traditional taxi services.

Nevertheless, the ride-hailing market still has potential for development as the demand for these services is increasing among the young in large cities. Many young people tend to choose ride-hailing and public transport services instead of private vehicles, Dung said.

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Thanh Ha - D.Thien - C.Trung - N.Xuan / Tuoi Tre News

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