In Local News, Public Transport / By Jonathan Lee / 6 March 2017 6:23 pm / 38 comments

In what could be perceived as a total U-turn, taxi companies are looking to work with ride-sharing app Uber in an effort to “save the taxi industry.” A report by The Sun states that the companies will sign a memorandum of understanding with Uber Malaysia as soon as this week, a sea change from recent years when both taxi drivers and companies alike railed against the maker of the app.

A pilot stage beginning next month will see around 500 taxi drivers across Peninsular Malaysia from at least six companies using the app to get passengers. The taxi companies are said to be finalising discussions with Uber, since the latter predominantly deals with credit and debit card transactions.

“We will continue to operate as metered cab operators,” said a taxi operation manager.? “But if a taxi driver decides to take bookings via Uber, then the cabbie has to follow the fare rate set by Uber, whether it is lower or higher than the current regulated fare by SPAD.”

The report also notes that the deduction of fare income through the use of the app will only be conducted between the taxi driver and Uber, although it remains to be seen if that deduction will remain at 25%, the same as regular drivers using private vehicles. “We have to move fast since e-hailing will be regulated soon after the law amendment in Parliament this month,” said another taxi company managing director.

When asked why the companies chose to collaborate with the San Francisco-based startup instead of local services like Grab (which started off as the taxi-hailing app MyTeksi), a director of a leading taxi company said, “The public are more aware with the Uber branding. We have also been using local apps [for bookings] but we are not getting much traction due to lack of marketing.”

Taxi drivers and companies have been outspoken regarding the rise of ride-sharing services like Uber and Grab since 2015, having organised multiple protests – including one which blocked Jalan Bukit Bintang. There have also been reports of drivers suing the app makers, as well as harassing their drivers.

All these have not dampened the popularity of these services, however, with The Sun reporting last October that around 10,000 taxi drivers have returned their vehicles to their respective companies due to stiff competition from Uber and Grab. It is said that many taxi companies may not survive beyond 2018, and have since told the publication that “instead of continuous war against Uber, it is time to embrace the ‘enemy.'”

The aforementioned director said that taxi companies have little choice but to use Uber in response to market demands, which The Sun noted was a clear sign that the industry was conceding defeat to the growing popularity of ride-sharing services.