The small city state of Singapore is set to witness a battle between an existing company and a new entrant in the ride hailing market. According to reports, the dominant player in the market Grab would be challenged by the Indonesian ride-hailing company Go-Jek.
The Indonesian firm started a trail launch of its services in selected areas of Singapore on Thursday and has announced its plans to starting a range of services via its smartphone app in the early part of 2019.
There has been increasing and aggressive investments being made by both the company – Go-Jek and Grab, in its services to gain market share in the SouthEast Asian market. Both the company have managed to raise billions of dollars. The SouthEast Asian market is becoming more lucrative especially for tech based companies such as tide hailing companies because more of the 640 million consumers of the region are moving online and making more use of smartphones for shopping, commuting and making payments.
Go-Jek has formed a partnership with DBS Group Holdings, the biggest bank of the region and is only launching its services in parts of Singapore in the initial phase. Go-Jek has the backing of large firms including the likes of Tencent Holdings, Alphabet Inc’s Google and Singapore state investor Temasek Holdings.
“As this is a new product, we will obviously give promotions, but at the end of the day it shouldn’t only be pricing that differentiates our services,” Go-Jek’s president, Andre Soelistyo, told reporters on Thursday.
Earlier this year, Grab had acquired the Uber Technologies’ loss-making Southeast Asian business – the first major consolidation in the industry in the region and enjots tha finanicla backing of Japan’s SoftBank and Chinese ride-hailing firm Didi Chuxing.
The acquisition however landed both Grab and Uber in trouble as both the companies were slapped fines by Singapore’s anti-trust watchdog and was ordered to take measures so that the local market is left open for competition to enter. Singapore’s anti-trust authorities had concluded that the merger of the two companies was responsible for higher costs for consumers.
There was no information provided by executives from Go-Jek aboiut the actual number of drivers it had signed up for this market and the company’s target for market share in the Singapore market. The executives however confirmed that the company’s payment services would be launched at a later stage.
Having initiated its journey in Jakarta in 2011 and starting off as a ride-hailing service, the company now offers a wide range of services that allows its customers to use the app as a one stop shop for making online payments and order online anything from food to groceries to massages.
(Adapted from LliveMint.com)