Time to end the taxi-app flap
- 13 Mar 2017 at 12:30
- WRITER: ERICH PARPART
The decision by transport authorities in Thailand to crack down on online ride-hailing services, specifically Uber and Grab, is the clearest example yet of the administration's lack of understanding of digital transformation.
At the beginning of last year, Prime Minister Prayut Chan-o-cha declared that Thailand would escape the middle-income trap and become a developed nation by 2036 by transforming itself from heavy industry to a value-based economy. Ever since, scarcely a day goes by when we don't hear about Thailand 4.0, our bright future brought to life by technology, knowledge, creativity and innovation.
So what does the Prayut administration do the moment it sees an innovative competitor that threatens to disrupt the outdated and mafia-infested taxi business? It tries to shut it down.
The excuse given by Transport Minister Arkhom Termpittayapaisith -- that the newcomers need to follow the regulations -- is feeble at best. If he has no problem with the mobile applications themselves, as he insists, then why doesn't his ministry support the newcomers by helping them to integrate themselves with the transport system?
Mr Arkhom instead sticks to weak excuses, such as unauthorised personal cars used as taxis being against the law. This, he says, does not ensure sufficient protection for passengers. But what kind of protections do passengers in authorised taxis really have?
All cars in Thailand including taxis require compulsory motor insurance (CMI) which is fairly limited and may not fully protect you. CMI covers passengers in your car and third-party liability, which means injury to other drivers and their passengers, up to the limit prescribed by law. It will not pay for damage to your vehicle, loss of use and other expenses.
Taxis also require at least Type 3 voluntary motor insurance which covers third-party property damage and excess third-party bodily injury, which not all cars are required to have, and that is where the problem comes in. The key words are "at least".
Most, if not all, Uber and Grab drivers I have used in Bangkok said they had at least Type 3+ which covers third-party property damage and excess third-party bodily injury as well as limited coverage for damage to their own vehicle due to collisions.
Instead of banning and arresting Uber and Grab drivers, wouldn't it be easier to simply allow them time to comply with the rules? If the Department of Land Transport (DLT) looked around, it would see that this is what its counterparts in other countries are doing.
Uber has shown it is willing to cooperate if pushed by authorities. Last month in Hong Kong, for example, it signed a contract to provide third-party coverage worth up to HK$100 million per occurrence of injury or death, the minimum required by law.
The DLT needs to realise that passengers no longer want to have to settle for traditional taxi drivers who refuse customers despite the existence of an unenforced law. Not to mention smelly cars, loud music and bad attitudes that make people emotionally uncomfortable.
Other excuses from the DLT that some Uber and Grab drivers are not properly registered and that their payment systems do not meet regulations are equally absurd. In Singapore, the Land Transport Authority last week opened applications online for Uber and Grab drivers to obtain private hire-car driver vocational licences -- and the two companies agreed to pay the costs.
In terms of safety, as a husband and a father of a one-year-old child, I would rather call Uber and Grab for my family any day and the reason is simple: I can track their journey. Not to mention that it is convenient to book by phone and estimate arrival time without having to guess whether the taxi is lost in some godforsaken soi I've never heard of.
Surely there is a compromise under which Uber and Grab can legalise their operations by agreeing to pay taxes while the DLT can offer an easy way for drivers to obtain the required permits. The businesses would get to operate, the government would get its money and passengers would no longer have to settle for a smelly sauna of a car.
If this government truly wants to promote a digital economy, then it should look at what digital age transport is all about. Innovations in urban mobility will not go away just because a few bureaucrats refuse to acknowledge what's going on in the real world.
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