Uber plans to launch ride-sharing option

ST PHOTO: JAMIE KOH

It says with uberPool, passengers pay less by splitting the bill and drivers get to earn more

Private car hire app Uber plans to roll out a new option to its UberX service in Singapore, which will allow passengers on a similar route to share a ride, a bit like taxi pooling.

The San Francisco-based start-up said passengers will pay less because they split the fare, and drivers will earn more as their cars will be better utilised.

Mr Chan Park, Uber's general manager for South-east Asia, said he is "pretty confident" that the option, called uberPool, can be introduced in the next few months.

The "uberPool is something we can launch only if we have enough liquidity in the marketplace... (that means) there are enough riders and demand, and enough supply to meet that demand... We are almost there," he told The Sunday Times.

The uberPool is available in 15 of the 360 cities Uber has a presence in, including London, New York and Shanghai.

DRIVEN TO PERFORM

For private-hire drivers, 100 per cent of their income comes from these (booking) platforms. They don't have an alternative like street hails. They have a real incentive to make sure their service (level) is high.

MR CHAN PARK, Uber's general manager for South-east Asia, on the motivation of Uber drivers

National University of Singapore transport researcher Lee Der Horng wondered how popular the pooling option would be. "When people talk about taxi or ride sharing, behavioural and cultural issues play a part. Would you like to sit in a taxi or car - a confined space - with a stranger?"

He said uberPool could be more effective if a "push" system was adopted, in which the app, by analysing commuters' travel patterns and habits, recommends a sharing option to its users.

Commuters agreed that cheaper fares might not override concerns about sharing a car with strangers.

Mr A.K. Tan, a 35-year-old engineer, said: "I'm not too sure about having to pick up another passenger on my ride, especially when I'm in a rush."

But he said uberPool could come in useful for faraway destinations, such as army camps. "If I'm not pressed for time, I don't mind sharing my trip with fellow camp mates, even those whom I may not know."

Plans to introduce uberPool come amid steady growth for the ride-booking app since its debut here two years.

Mr Park did not give exact figures but said UberX drivers in Singapore number in the "tens of thousands" while passenger numbers are in the "hundreds of thousands" every month.

UberX is Uber's budget-priced private chauffeur service, with fares similar and, at times, lower than those of taxis. A government review is looking into whether UberX, along with its rival GrabCar, is competing fairly. Last month, the National Taxi Association had called for UberX drivers to be licensed and for private-hire cars and taxis to be subject to similar regulatory standards.

Mr Park said UberX drivers do not deliver sub-par service just because they do not go for a taxi driver vocational licence programme.

Under the app's rating system, in which passengers review their trips on a scale of 1 to 5, UberX drivers fared better than cabbies, he added. Taking a random sample of 100,000 trips each on the UberX and Uber Taxi platforms, he found that private-hire drivers registered 4.65, on average, compared to 4.42 for cabbies.

"For private-hire drivers, 100 per cent of their income comes from these (booking) platforms. They don't have an alternative like street hails. They have a real incentive to make sure their service (level) is high," said Mr Park.

While he is not opposed to driver licensing or regulations, he said that such a step should not create unnecessary barriers which may make private car-hire drivers leave the industry.

He said UberX has helped to meet transport needs, such as "plugging in" the supply during peak hours, and fulfilling the last mile journey.

About half of its UberX drivers are part-timers - a "flexible workforce", he added.

About 20 to 25 per cent of UberX trips during the peak hours start or end within 50m of an MRT station, he said. "It means people are taking the MRT and then using UberX to get home. Or taking UberX to get to the nearest (MRT) station."

This, Mr Park said, shows Uber has helped to encourage people to use public transport.

Many commuters also turn to UberX during public transport disruptions, such as train breakdowns.

And during high demand periods - peak hours or festive seasons - Uber's surge pricing mechanism kicks in, to incentivise more drivers to meet the demand.

During the North-South Line train disruption on Nov 25, for example, UberX fares were reportedly as much as 3.8 times higher. Such surge pricing has drawn criticism.

Mr Park said that while the surge multiplier is based on an algorithm, the company does impose a cap - though he declined to give a figure - in circumstances like train disruptions. "People think of it as predatory pricing. It just isn't. It's our way of making sure that as many of these stranded people are getting home as quickly as possible."

A version of this article appeared in the print edition of The Sunday Times on December 27, 2015, with the headline 'Uber plans to launch ride-sharing option'. Print Edition | Subscribe