Forum: Regulators should scrutinise any potential Grab-GoTo merger
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Although the Competition and Consumer Commission of Singapore has not received any formal merger notification from Grab or GoTo, speculation about a potential tie-up has understandably drawn public interest ( No Grab-GoTo merger notification yet, says Singapore competition watchdog
As a frequent user of private-hire services, I hope that the authorities will examine any prospective consolidation carefully and, when necessary, act early to safeguard the interests of commuters and drivers.
My concerns arise from observing how the market has evolved. Two decades ago, a metered taxi trip from the north-west to Bukit Batok cost about $7. Today, dynamic pricing for the same journey can be about $20. Inflation and higher operating costs are part of the explanation, but the scale of the increase suggests that competitive pressures may have weakened.
Conditions in 2016 present a useful contrast. When platforms such as Uber and Grab competed actively, commuters benefited from faster responses, regular innovation and more moderate pricing. Promotional incentives were never meant to be permanent, but they helped raise service standards and build trust among users. That vibrancy has gradually diminished.
A merger between two major regional operators risks reducing market contests even further. Without meaningful rivalry, fares may continue to rise while driver earnings stagnate, and service reliability may weaken. For the sake of a fair and resilient transport ecosystem, regulatory vigilance is essential.
Drivers have also observed significant changes. Several have shared that earlier incentive structures, which were based on the number of rides completed, encouraged them to accept shorter trips readily. With incentives now more limited, cancellation rates for short-distance rides appear noticeably higher, which affects commuter confidence.
It may therefore be timely for regulators to re-examine the broader private-hire operating model, regardless of whether a merger eventually takes place.
One possible approach is to introduce clear guardrails on dynamic pricing, such as limiting fare variation to a reasonable range, for instance 10 per cent. This would help prevent extreme surges and reduce opportunities for bad actors to exploit the system. Such measures would protect the long-term interests of drivers, riders and platform operators alike.
Lim Guohao
