Major Vietnamese taxi company Mai Linh on Monday launched its own motorbike hailing app in its latest attempt to claw back customers from Uber and Grab, the ride-hailing firms from the U.S. and Malaysia that have been outshining local cab firms.
The app, Taxi Mai Linh, is now available in Ho Chi Minh City, Hanoi and Da Nang, and has around 5,500 drivers.
Ho Huy, Mai Linh’s chairman, said what makes his company’s new service different from Uber and Grab is that the fare is kept constant at VND11,000 (48 cents) for the first two kilometers and then drops to VND3,800 per kilometer from the third kilometer onwards.
Uber and Grab charge their passengers similar rates but raise fares during rush hours and bad weather.
He also said the company will run a campaign to encourage traditional xe om drivers to join its team in an effort to avoid fights between them and tech-savvy drivers, something that both Grab and Uber have experienced.
So far, the strategy seems to be working, and many Uber and Grab drivers have shown up at Mai Linh’s door to switch sides.
“I applied because I heard Mai Linh is offering a better deal for its drivers,” said Cuong, who has worked as a GrabBike driver for over a year.
“My income has fallen because Grab now deducts up to 20 percent of the fares that drivers receive from passengers instead of 15 percent as before, and more and more people are working as GrabBike drivers, which means more competition,” he said.
Uber takes a cut of 25 percent from its drivers.
Mai Linh’s drivers will not have to hand over any of their earnings for the first two months, after which time the company will take a 15 percent share.
Mai Linh reported that it lost 6,000 employees in the first half of this year, or 20 percent of its total drivers.
Its business results did not read much better during the same period, with revenue falling more than 5 percent on-year to VND1.72 trillion ($75.8 million).
In all, Mai Linh suffered a loss of VND47.5 billion from its taxi business, twice as much as last year, the company said.
Its rival Vinasun, the biggest taxi firm in Vietnam, lost 10,000 employees in the first nine month, and its revenue in that period only reached 58 percent of the company’s annual target.
They have both pointed the finger at Uber and Grab, saying the two foreign firms enjoy preferential policies as they are classed as transport software providers which, unlike traditional taxis, are not accountable for passenger and traffic safety.
In its latest attempt to battle Uber and Grab, Vinasun has rolled out a hailing servicevia Facebook Messenger.