Grab awarded street-hail operator licence, set to become Singapore’s sixth taxi operator

SINGAPORE – Ride-hailing giant Grab has been awarded a street-hail operator licence, paving the way for it to become Singapore’s sixth taxi operator.

The licence – awarded to GrabCab, a subsidiary of Grab’s rental arm GrabRentals – will start on April 9 and is valid for 10 years, the Land Transport Authority (LTA) said on April 2.

Under the licence, GrabCab will have a grace period of three years to progressively expand its fleet to meet the minimum fleet size requirement of 800 taxis, noted LTA.

Under the current point-to-point transport regulatory framework, which took effect in October 2020, all new holders of street-hail service operator licences will be given this grace period to build up their fleets.

GrabCab is the first new entrant under this regime, said LTA.

Grab did not disclose GrabCab’s targeted fleet size when asked.

LTA said that GrabCab’s entry into the street-hail industry will provide drivers and passengers with more options and is expected to boost the supply of taxis.

The authority added that GrabCab will need to comply with the conditions of its licence, including meeting LTA’s safety standards and ensuring that partnership arrangements with drivers are non-exclusive in nature.

GrabCab must also ensure that its taxis are easily identifiable by street-hail customers, including having a prominent rooftop sign and a distinctive livery scheme.

Its vehicle models must be approved by LTA, and meet requirements such as having enough boot space to carry a folded wheelchair or luggage.

Its street-hail services must also follow the same taxi fare structure components as other street-hail operators and must prominently display them, so that passengers are informed of the applicable fares, said LTA.

Grab said the licence will give it the opportunity to introduce a taxi fleet to complement private-hire cars on its platform.

“This enables us to address unmet consumer demand and improve ride availability, particularly during peak hours, late nights and in areas accessible only by taxis,” its spokesperson said, describing Singapore as a “supply-constrained market”.

Places accessible only by taxis include taxi stands, certain event venues and industrial areas, said Grab.

“It also positions us to better serve the anticipated growth in point-to-point rides in the coming years, while catering to consumers who prefer street hailing,” added its spokesperson.

Grab said it will, in the coming months, launch a GrabCab fleet featuring “popular low- and zero-emission hybrid and electric vehicles from leading manufacturers”. It did not specify the vehicle models when asked.

In a registration form for prospective drivers seen by The Straits Times on April 2, the earliest collection date for a rented GrabCab vehicle is estimated to be in June.

Recruitment for GrabCab drivers officially began on April 2, and Grab told ST it has received “strong interest” since the announcement was made earlier in the day.

All GrabCab vehicles, added the company, will be equipped with telematics devices to improve ride safety. These devices can monitor driving patterns, detect harsh braking or acceleration and track incidents.

The firm will also provide all GrabCab drivers with access to its “relief matching marketplace”, so that it is easier and safer for them to find a verified relief driver, rather than rely on informal networks or external avenues.

Asked how Grab will ensure fairness between other taxi operators and GrabCab on Grab’s platform, the company said there will be no change to the existing arrangement that the platform has with its drivers, including the allocation of bookings.

“We will continue to maintain an open and fair platform for all private-hire vehicle and taxi drivers, regardless of the company they’re contracted to.”

Drivers who join its new fleet under GrabCab will have “full freedom to drive for other platforms”, and Grab will not limit these drivers’ options, it added.

Grab said its GrabRentals team will manage GrabCab.

This is not the first time Grab is attempting to enter the taxi market.

Its bid in 2023 to buy taxi operator Trans-Cab was abandoned the following year after Singapore’s competition watchdog said in a provisional ruling that the acquisition was likely to lead to a substantial reduction of competition in the ride-hailing market.

Grab’s latest foray into the taxi industry will make it the sixth taxi company in Singapore, after Comfort, CityCab, Trans-Cab, Strides Premier and Prime.

The five taxi operators here operate a total of about 13,000 cabs.

Comfort, which is owned by ComfortDelGro Taxi, has 6,257 cabs, according to the latest taxi fleet figures published by LTA in January. It has been operating since 1970.

CityCab, also owned by ComfortDelGro Taxi, has a fleet of 2,063 taxis. It started operating in 1995.

Having operated in Singapore since 2003, Trans-Cab has a fleet of 2,077 taxis.

As a result of

a merger between Strides Taxi and Premier Taxi

in 2023, Strides Premier has a combined fleet of 2,044 taxis.

Prime Taxi, operated by diversified motor group Prime, is Singapore’s smallest taxi operator with 545 cabs, including a sizeable number of limousine taxis. It started operating in 2007.

LTA said the grace period for licence holders to build up their fleets to the minimum of 800 cabs did not apply to existing operators, including Prime Taxi. It said it is working with the operator on its fleet-growth plan, so that Prime Taxi can achieve the minimum fleet size by the end of 2026.

Mr Neo Chee Yong, deputy general manager of Prime Taxi, acknowledged that its fleet size is below the minimum requirement and said it is working on increasing its fleet.