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Grab: Recent Price Hike Due to High Demand For Rides & Low Supply of Drivers

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Source: Connected to India & Grab Authorised Alpha Driver

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Complaints surrounding Grab’s e-hailing services such as the inability to book a car, unusually high fares as well as long waiting times have been circulating in the past few weeks.

It has led to Malaysians comparing its fares to those of taxis, citing that they are much cheaper than Grab’s services.

 

Clearing the air on things, Grab has recently released a media statement on the reason behind their fluctuations in price.

According to the statement provided to WORLD OF BUZZ, Grab revealed that they have not made any changes to the fare structure of their e-hailing services.

 

3 factors driving the instability in supply and demand

In the statement, Grab says that, “The price fluctuations that our users are seeing is a result of fewer drivers on the road to accept a sharp increase in ride demand from our passengers.”

This is a ultimately a result of 3 major factors:

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1. Shift to the endemic phase

According to the statement, many driver-partners have become inactive on the platform due to the low demand for rides due to Covid restrictions in the past 2 years.

However, with the increasing relaxation of Covid SOP measures and the recent festive periods, Grab has seen a sharp rise in demand for rides. The combination of these circumstances have caused a mismatch in the supply of drivers and demand for rides.

 

2. Barriers to entry of driver-partners

Meanwhile, Grab states that the rigorous vetting processes for new drivers has also placed a structural limit to the speed at which new driver-partners can start working.

These include 6 hours of training, exams at driving schools, vehicle inspection, purchasing insurance, and collecting and submitting documents to various government agencies.

 

3. Large increase in traffic congestion

Grab also explained that being stuck in traffic also increases the cost (in time and fuel) of each ride, while simultaneously reducing the effective capacity of drivers to fulfill more rides.

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The solution

On the issue of high fares, Grab states that they “remain steadfast in their commitment to providing affordable rides for the community“, as they strive to meet all of the demand for the time being.

Additionally, to grow the supply of driver-partners, Grab is implementing the below steps:

  1. Increase incentives for driver-partners to get back on the road during peak hours,
  2. Subsidise up to 100% of total driver-partner regulatory compliance cost,
  3. Offer referral bonuses up to RM300 to existing driver-partners to refer and help onboard new driver-partners,
  4. Offer a bonus of up to RM1,000 to any Malaysians who get onboarded as a driver-partner on the platform,
  5. Assist new driver-partners to navigate through various regulatory processes from medical checks, training, exams, vehicle inspection and licensing.

Driver

 

Suggestions for passengers

To ensure a more pleasant experience, Grab recommends that passengers plan their trip and book earlier than usual. 

They also emphasised on the importance of not cancelling on a ride after managing to get one even though the waiting time may seem unusually long.

If you did not know, there is also a ‘Fare Alert Notification’ feature on the Grab app which can help with getting lower fares. Click on this link for more information.

 

What do you think of the situation? Will the price hike deter you from booking Grab rides? Let us know in the comments.

 

Also read: M’sian Spends RM1,000 Monthly on E-Hailing For Daily Commute, Sparks Debate About Car Ownership

Grab Statement Also Read

Source: klia2.info
Source: flickr


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