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Grab-Uber merger: Drivers worried about incentives, car rental contracts



SINGAPORE: Hot on the (w)heels of Grab’s acquisition of Uber in Southeast Asia, many drivers are raising questions about the way forward with Grab becoming the biggest player in the local ride-sharing industry.
While agencies such as the Land Transport Authority (LTA) and Competition Commission of Singapore (CCS) are ironing out the details and studying the impact of the deal, some drivers have expressed concern about their car rental contracts and incentives.
Mr Mervyn Tan, an admin for a 28,000-strong Facebook group for Uber and Grab users, said he has seen a flurry of posts in the group with many drivers asking about their existing contracts with Uber’s car rental partner Lion City Rental since news broke on Monday morning (Mar 26).
“Their number one worry above everything else is money. Everything related to money is what they worry about. Will they have a job after Apr 8? Are they able to get out of the contract?” said Mr Tan.
On top of these questions, Mr Tan said that there are some drivers who may be stuck with a rented car and unable to join Grab because they were previously blacklisted.
AdvertisementAdvertisement“For previous drivers under Grab who were terminated by Grab for whatever reason, they are not entertaining any applications from them. This was told to me by one of the drivers,” Mr Tan said.
Uber driver Ian Liow is among those who are renting their cars from Lion City Rental, which stipulates in its rental contracts that drivers cannot use the car for private-hire services on platforms other than Uber.
“But with Uber selling off its entire operations to Grab, legally wise, does it mean that any hirer who has a contract with Lion City Rental can therefore drive for Grab officially and legally? Uber and Lion City Rental have to come out to put the record straight,” Mr Liow said.
Lion City Rental posted that it is “closed until further notice” on Facebook and has reached out to hirers through SMS saying that it will contact them in the coming days.
“Since they have already taken the initiative to send out an SMS saying that they will initiate contact, we will see what they say. Clearly they have the obligation to answer to their hirers, especially those with contracts,” Mr Liow said.
Member of Parliament Ang Hin Kee, who is also an executive adviser to the National Taxi Association, said that he is aware of these concerns.
In a Facebook post, he said that “both the NTA and the National Private Hire Vehicles Association have shared drivers’ concerns with LTA and the CCS”.
Another concern worrying drivers is whether the current incentives would continue after the merger. Currently, both companies have different reward systems to incentivize hirers in their fleet to ply the streets.
“Uber’s side has Uber’s way of paying the drivers in terms of incentives, Grab also has their own way of paying incentives. If these two merge together right now, I’m not sure how the incentives are going affect us,” said a driver who goes by Mr Lim.
“And because there will be more drivers now driving for Grab, they probably will reduce the incentive payment for every driver. So that may affect our total earnings going forward,” he added.
Some drivers have lamented that they are left with no choice but join Grab. One driver who gave his name as Abu said that the two companies could have merged but kept both apps.
“I have to follow the crowd, no choice. The corporations can merge and they could have kept the apps as they are. This would be a friendlier solution for both riders and drivers, keeping things as per normal but as one company,” said Mr Abu.
“When the rumours were going around, my expectation was that Uber would remain as Uber the app,” he said.
Those with the taxi driver's vocational licence might have the option of joining the taxi fleet but some drivers said they will not go back because of the high rental costs compared to those offered by Grab’s partner rental companies.
Full-time Uber driver Timothy Lee, who also has the taxi vocational licence, said: “The ComfortDelGro app has fewer requests compared to Uber. How am I going to cover rental costs? It’ll be a vicious cycle again.”
Other drivers have also said that the two-week transitional period until Apr 8 is insufficient for Uber drivers to register themselves with Grab. New Grab drivers will have to undergo a 30-minute online training video and quiz, and wait for at least five working days for the company to process their registration.
New drivers will also have to learn how to use the Grab app.
“For example, the Uber app doesn’t require us to manually key in ERP charges but the Grab app does. If you forget or don’t know how to do this, the drivers will end up paying for this extra charge,” a driver who goes by Shankar said.
“This is something that’s clearly not very transparent or ethical on Uber’s side. I’m quite disappointed with them on this matter. They should have at least given more notice, like a three months’ notice which is more reasonable. There are so many issues to iron out,” Mr Liow said.
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