Indonesia’s Express Taxi partners with Uber

  • Uber can tap into more than 11,000 Express Taxis, 17,000 potential skilled drivers
  • Express Taxi hopes to improve its image as well as financial, and operational performance

 

Indonesia’s Express Taxi partners with Uber

 

INDONESIA’s second biggest taxi company PT Express Trasindo Utama Tbk (Express Taxi) has just announced partnership with Uber Technologies for a ridesharing integration and vehicle-financing pilot project in Indonesia.

The timeline of the pilot project is currently undisclosed. However, the project will allow limited numbers of regular Express Taxi’s driver-partners to use the Uber application to accept orders under the UberX scheme.

“As one of the largest taxi companies in Indonesia, we continuously explore new ways to create value for our stakeholders.

“Through this collaboration with Uber, we hope to achieve a higher utilisation rate for the Express Group fleet and deliver safe, convenient and attractive mobility services to customers, while allowing our drivers to benefit from ridesharing technology that gives flexibility and exposure to more economic opportunities,” said Express Group chief operating officer Benny Setiawan in a statement.

Express Taxi, owned by Indonesian conglomerate PT Rajawali Wirabhakti Utama (Rajawali Corpora) operates about 11,000 taxis across Jakarta, Medan, Semarang, Surabaya, Padang, Bali and Lombok, with 2,200 employees and more than 17,000 driver partners.

Established in 1981, the company has its regular taxi services branded as Express Taxi, hotel exclusive Eagle Taxi, and premium brand Tiara Express; the majority of its fleet falls under the regular taxi category.

“We cannot deny that the transportation sector is disrupted with rapid development of technology, and while we are doing our own development in IT, we also need to ensure our driver partners’ prosperity. By using Uber’s application, we hope that our drivers can get more passengers each day,” the Group’s corporate communications executive David Chen told Digital News Asia in a phone interview.

“At the same time we also would like to see this partnership improve our company’s image as well as financial and operational performance in the future,” he continued.

The group’s financial performance has been greatly affected by the rise of Uber, Grab, and homegrown startup Go-Jek in the past year. In its third-quarter ended September this year (Q3 2016), the company’s revenues decreased 29% to Rp512.6 billion (US$38.3 million) from Rp721.4 billion (US$53.9 million) in the same period last year.

It has also posted a loss of Rp81.9 billion (US$6.1 million) compared with a profit of Rp11.1 billion (US$832,674) in the same period last year.

The financial struggle resulted in the company’s board members resigning earlier this month, according to reports in The Jakarta Post and The Jakarta Globe.

“The change of directors and commissioners on the board was needed to face the challenges of the current taxi business,” said the group’s corporate secretary Handy Prawira.

Meanwhile, looking forward, David told DNA that the company has high hopes of this pilot project and will continue to monitor its development.

“For now, we will only allow a limited number of regular taxis to go through this pilot project, and we have only chosen Jakarta as the model city for the project. We hope that we can duplicate and expand this partnership to more fleets and cities,” he added.

Although some of the Express Taxi driver partners were against the online-transportation model at first, according to David, they are now more than happy to collaborate and try accepting orders from Uber app.

“Our driver partners are very keen on this partnership, seeing this as their way to increase their monthly revenue,” he concluded.

Vehicle financing scheme

For Uber, the partnership brings potential exposure to Express Taxi’s fleet as well as driver partners. Under the partnership, Express Group will create a new, flexible vehicle financing option, from which Uber driver partners can benefit.

Express Group itself has built a partnership scheme for drivers, where in six years, the cars will belong to the drivers and not the company. The drivers will pay a certain amount every month like an instalment to the company from their monthly deposit.

From the official statement received by DNA, Uber explained that their existing and future Uber driver partners can lease vehicles from Express Group, with no taxi attributes or branding, and help meet their monthly payments through earnings generated from driving on the Uber platform.

Furthermore this initiative will be one of the many deals available under Uber’s current Vehicle Solutions programme.

“We are excited that Express Group, a prominent taxi company in Indonesia, is embracing ridesharing and technology to tap into new markets. This collaboration is all about making ridesharing more reliable for riders and unlocking greater economic opportunities for driver-partners. We look forward to collaborating further with Express Group,” Uber APAC head of business Eric Alexander said in a statement.

 

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