Uber's proposed sale of its South-east Asian business to rival Grab has fuelled much discussion on its implications for the transport landscape in Singapore. We believe that the merger will have an adverse impact on competition in the industry, hurting both consumer riders and drivers.
Over the years, riders have been accustomed to frequent discount codes on top of already low fares - reaping the benefits of fierce price competition between Uber and Grab. As both platforms had very similar product offerings, and because most riders were not particularly loyal to either platform, neck-and-neck price competition was the only logical market outcome. With its competitor becoming part of itself, a post-merger Grab has every incentive to raise its prices.
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