Uber’s Southeast Asia Rival GrabTaxi Launches Carpooling, Its First Peer-To-Peer Service

The league of taxi apps rivaling Uber is alive and well after GrabTaxi, the SoftBank-backed company that rivals the U.S. firm in Southeast Asia, became the latest Uber competitor to introduce a carpooling service for commuters.

GrabTaxi, which currently offers rides with registered taxis, private chauffeurs and — in some countries — motorbike taxis, is stepping into the peer-to-peer space for the first time with Hitch. Like its namesake service in the U.S. from Lyft, Didi Kuaidi’s Hitch in China and Ola Share in India, the service is a carpooling option that costs less than a taxi. The idea is that you can take a cheaper ride than usual with a car owner who is headed in the same direction, e.g. commuting into work or a weekend trip, and drivers offset the cost of running a car.

GrabHitch, as the service is called, will be another option available inside the GrabTaxi app, and it is initially being piloted in Singapore. GrabTaxi said it expects to fully launch GrabHitch in Singapore before the end of the year, after which it will be expanded to other markets in Southeast Asia during 2016.

The move is an interesting one since GrabTaxi has made its mark, and rivaled Uber in Southeast Asia, by predominantly focusing on licensed taxi rides. Stepping into peer-to-peer with GrabHitch, does it risk upsetting the taxi drivers who rely on, and have been loyal, to its service by letting anyone with a car become a taxi driver?

GrabTaxi co-founder Tan Hooi Ling positioned the service as filling a void in the market — and increasingly vehicle supply — rather than cutting into traditional cabbies.

“There’s a large gap between taxis and public transport services,” she told TechCrunch in an interview. “Public transportation [like buses] typically costs SG$1-3 in Singapore, for example, while taxis are something like SG$15. That’s where we think we think there’s a great opportunity for something like Hitch to come into play.”

GrabHitch drivers, she added, are those who “own a car and are looking for ways to offset costs” — such as petrol, insurance and maintenance — by offering rides to those who are going in the same direction or to the same end destination.

As for any concerns that existing professional drivers may have, Ling said that — like other services offered by GrabTaxi — GrabHitch is “an additional input funnel to the demand side of our platform.” In other words, one day I take a GrabHitch ride, but another I might book a regular GrabTaxi or decide on a private chauffeur from the GrabCar service.

Singapore looks like an obvious first market to start the initiative for a few reasons. Not only is GrabTaxi, which was founded in Malaysia initially, headquartered there, but car ownership is expensive there, taxis are pricey, while the city-state’s ride-sharing regulations are, Ling said, “very favorable” to this new service.

In line with those rules, drivers can only take two GrabHitch rides per day, and the fare should cover consumption costs only — for example petrol.

Uber rivals GrabTaxi in Singapore, where it offers Uber Black and Uber X, among other services. The latter is an obvious rival to GrabHitch since it offers a more affordable ride than a taxi. With Uber X Singapore costing a base fare of $3.50 and additional fees of $0.25 per minute or $0.50 per kilometer, it’ll be interesting to see how GrabHitch competes on price.

When asked whether GrabHitch was developed in partnership with Didi Kuaidi, which recently invested in GrabTaxi and has put money into Lyft and Ola in India, Ling declined to be overly specific.

“In every idea we pursue, we look for data points and market points from multiple different sources. We have discussions around mutual best practices,” she said, declining to say whether GrabTaxi has plans for other peer-to-peer services further down the line. (Didi Kuaidi has launched a designated driver service, community buses, test drives and more.)

Ok then. She also refused to confirm whether GrabTaxi is actively seeking to fill its CTO position, which has been vacant since August when former Facebook engineer Wei Zhu left the post after just one year in the role. Zhu was, among other things, heading up the company’s $100 million R&D center in Singapore. Ling did say that, for now, GrabTaxi VP of Engineering — former Amazon and Microsoft exec Arul Kumaravel — is handling many of the CTO responsibilities.