Taxi drivers take part in a protest against what they say is unfair competition from ridesharing services outside the Presidential Palace in Central Jakarta on March 14. (Reuters Photo/Darren Whiteside)

Ride Sharing Apps Change the Face of Jakarta's Busy Streets


MARCH 16, 2016

Jakarta. While ride sharing apps have been welcomed a major game changer for many — both passengers and drivers — their introduction has drawn a backlash from many employed by older transportation companies.

“Since those applications boomed, I have never paid my daily payment to the [taxi] pool right anymore,” a driver of Express Taxi, who just wanted to be identified as Udin, told the Jakarta Globe on Monday (14/03).

Udin said he registered with Grab Taxi, the technology-based company connecting passengers with taxis, a few years ago and was happy with it at first.

"There used to be hundreds of orders from this app, but now you'd be lucky to get three in a day after they introduced Grab Cars," he said, referring to the function in which private cars offer driving services, similar to Uber.

The apps have eroded demand for taxi services in the city, he said.

Udin said he needs to pay Rp 335,000 ($25) per day to the taxi pool, as part of his fixed-payment scheme with Express, a taxi operator controlled by Peter Sondakh’s Rajawali Group. Udin said this fee is on top of fuel costs, which averages Rp 250,000 per day.

“Not just Grab car and Uber, but also those Grab Bike and even GoJek, they ate the short distance order, like the Rp 20,000 or Rp 30,000, for taxis like us,” said Udin, who said due to that circumstances, he can now only send his wife Rp 100,000 to cover living costs every 10 day.

“What can I do? The pool manager once didn’t believe what drivers said [about orders going down], but after he went to drive the taxi himself, he believed it. Orders are difficult to get nowadays, that what he said,” said Udin, who lives in a house with 11 other drivers to minimize renting costs in Jakarta.

Udin slammed Grab for cannibalizing taxi service within the application itself and criticized the low bonuses he gets now from Grab.

Meanwhile, the battle for legal recognition among ride hailing apps remains tough in Indonesia, with traditional services opposing legalization and customers demanding safer and more efficient public transport.

Large-scale protests by public transport employees, including bus, Bajaj, and taxi drivers in Jakarta demanding Uber and Grabcar — which they claim fail to comply with the 2009 road traffic law — be banned. These providers of traditional transportation means claim they have suffered a significant decline in customer numbers, resulting in a loss of income.

Both ride-hailing application operators have repeatedly denied the accusation, saying they are technology companies and therefore don't need to comply the road traffic law.

After a limited cabinet meeting with President Joko Widodo at the State Palace in Central Jakarta on Tuesday, the government pledged to give assistance for ride-hailing applications to apply for permits to operate in the country.

Taxis are parked near the national monument as their drivers take part in a protest against what they say is unfair competition from ridesharing services in Jakarta, Indonesia March 14, 2016. (Reuters Photo/Darren Whiteside)

Game changer for customers, drivers

The government has estimated 26 million people a day move within Jakarta and its surrounding cities of Bogor, Tangerang, Depok and Bekasi. These consumers demand an easing of transportation, friendlier service and an improvement of congestion.

For Jeane, a 25-year-old Jakartan, said she is happy with service of all-inclusive apps like Grab, which provide taxis, private cars and motorbike taxis.

"It depends on the condition. If I'm in a rush, I will probably stop a taxi on the street, but if I got a spare time, I'll use GrabCar instead. The price for GrabCar is also cheaper at times due to promotions and the capacity is also bigger. A car can accommodate around five to six passengers," she said.

"Online services are easier to access. I don't need to walk and find a taxi," Jeane said.

Sophia, a 30-year-old tax consultant, said she prefers Uber, as it offers more drivers on the road and cheaper prices.

For Mira, a 25-year-old Jakarta based freelancer, the apps provided by existing taxi operators, including the country's largest taxi company Blue Bird, can't match the comfort of hailing cars — or the cheaper prices.

"I enjoy using GrabCar because the price is fixed despite traffic jams … the application is more responsive than, say, Blue Bird's. So, it's easier for me to call GrabCar from its apps," she said.

For the drivers itself, they found their new job is quite promising, from the revenue side.

Nastangin, a driver with Grab said he earns about Rp 5 million per month nowadays, a higher income compared to driving angkot, a minibus public transportation.

“If you work harder, you could get more. The thing is there is no boss to tell you around, it’s all up to you how much you want to earn,” he told the Jakarta Globe. For the father of a 2-year old daughter, this job gives him certainty in terms of income.

He said he was working as angkot driver before spending a decade in Malaysia as a foreign worker, also as a driver. Including bonuses from Grab, he said he could earn over Rp 5 million, he said.

Nastangin said if the government were to block the application, “could they guarantee that drivers like us get a job with similar earnings? Please consider people like us,” he said.

Rudiantara, who has strongly rejected potential blocking of the apps, said both Grab and Uber would be assisted in resolving permit issues.

“No more bustle and people will still be able to enjoy better service, more conveniently and more affordably,” Rudiantara said.

Uber and Grab claimed they have applied for permit to build a cooperative dubbed the Association of Indonesia Car-Rent Service Cooperative on Dec. 22, 2015, despite attackers of the transportation startups saying they bring unfair competition as the fleet is not registered as public transportation vehicles, under which according the law they should have corresponding official yellow license plates.

Rudiantara promised that the settlement will also consider the interests of both taxi companies and ride-sharing applications.

The apps have been a source of the transport ministry's confusion since their introduction into the Jakarta market. In December, transport minister Ignasius Jonan issued a letter to law enforcement stating all Uber and app-based motorcycle taxi services are banned. The move was quickly condemned by the public and other members of the government, with the president overruling it within hours.

Writing by Muhamad Al Azhari