Singapore’s decision to fine ride-hailing firms Grab and Uber will not have a significant impact on either business and only highlights governmental inability to protect customers, according to analysts.
Following Uber’s sale earlier this year of its Asean operation to Singapore’s Grab, the anti-trust Competition and Consumer Commission of Singapore handed the firms fines totalling about US$9.5 million.
The commission directed the companies to open up the island’s market to new operators and ease the impact of reduced competition.
Uber replied that the watchdog had an “inappropriately narrow definition of the market”, adding that it would consider appealing against the commission’s decision rather than pay the fine.
Observers said the fine was relatively light for Grab, which now dominates the city-state’s lucrative market.
“These imposed fines are even less impactful than a slap on the wrist for Uber and Grab,” said Corrine Png, CEO of transport analysts Crucial Perspective. She added that Grab raised billions of dollars in fresh funding following Uber’s retreat from Asean.
Uber is valued at US$72 billion and Grab at US$11 billion, according to CB Insights, with the latter recently raising about US$2 billion in funding from Toyota and some financial firms.
Malaysia began investigating the Uber-Grab merger in mid-July and is yet to announce its decision.
This week Grab said it would stop offering late-night Singaporean carpooling after drivers complained about drunken, confrontational passengers.
Drivers described vomiting and arguments leading the tech firm to abandon its GrabHitch service between 1am and 5am from October.
GrabHitch enables private drivers to offer a ride to strangers heading in the same direction for a fee.
The overnight carpooling service offered by Grab’s commercial drivers has been suspended since June.
The company’s other ride-hailing services will operate overnight.
“Grab has always taken a proactive approach to ensure that our driver-partners and passengers will have a safe and positive driving/riding experience,” the company said.
Ride-hailing firms have faced scrutiny about safety after conflicts between drivers and passengers.
China’s largest ride-hailing firm, Didi Chuxing, introduced safety measures after an outcry over the murder of a 20-year-old passenger by her Didi driver last month, the second such incident since May.
Singapore needs more initiatives to cut congestion. Picture credit: Flickr