SINGAPORE: Car-hailing app GrabTaxi on Wednesday (Nov 11) launched a new service called GrabHitch, which allows drivers with extra space in their vehicles to pick up passengers going the same way. This carpooling service may be used for journeys of all kinds, and passengers can pre-book a ride seven days in advance and up to 15 minutes before pickup. For instance, a driver who commutes to work daily can carpool with a passenger who takes a similar route using GrabHitch.
All fares are paid via GrabPay, which is GrabTaxi's cashless credit card payment option. The fares will cover the driver's variable costs, such as petrol and car depreciation, and it is calculated based on the distance of the ride. Passengers will be able to view the fares before booking the ride to ensure they are comfortable with paying the price.
Under Singapore's carpooling regulations, GrabHitch drivers can only accept up to two rides a day. GrabHitch drivers are not required to take up commercial insurance, and are covered by their personal motor insurance. Under these regulations, drivers who carpool are also not allowed to accept monetary benefit or payment in kind for profit, but only to cover the expenses incurred during the ride.
GrabTaxi said there are many benefits to this new service. Drivers can offset the cost of their journey while passengers pay half the cost of a taxi. Safety features such as the option to travel with someone of the same gender and live tracking of the app are also put in place.
Potential GrabHitch drivers must provide documentation including their driving licence, motor vehicle registration and insurance. GrabTaxi said that there will also be further verification checks for major traffic offences, to ensure the safety of passengers.
Drivers who are interested in signing up for GrabHitch can do so during its beta driver signup phase from Nov 11 to 30. The service will be launched to all consumers in Singapore by the end of 2015, it said.
I’m probably going to show my age here, but I’m old enough to remember the days when we had to carpool to get into the CBD for free. Back in the days before the dreaded ERP took over our lives, you had to buy a paper license that cost $3 to $5 per day to get into the CBD. In order to encourage carpooling and reduce the number of cars on the road, cars with four or more passengers were exempted from this payment.
Unfortunately, Singaporeans being Singaporeans, we found a loophole and in the end, this exemption was soon removed. As a result, carpooling became less popular in Singapore, even though a local carpooling website ShareTransport.sg boasts over 23,000 users and says there are now over 1,200 messages on their site each month. But that’s all supposed to change now.
Huh? What’s different now?
In March this year, laws were passed to clarify exactly what is legal when it comes to offering carpooling services. The biggest news out of all this was that drivers could now legally take payment from passengers who hitch a ride. This is in line with the Government’s continued efforts to discourage car ownership and incentivise car-sharing.
The laws ensure that ‘true’ carpooling is being promoted, and prevents profit-minded drivers from essentially running their own Uber or GrabCar service (which, while also legal, requires proper commercial insurance and licensing). These include preventing drivers from soliciting passengers on the road, at parking places or public stands. In addition, drivers can only offer a maximum of two carpool rides per day.
But most importantly, drivers and passengers need to agree on four things before the start of the carpool ride. These are pick-up points, drop-off points, the date and the payment amount.
Wow, that sounds like it could be a complicated process. How would we know how much a trip is worth?
Well, that’s exactly the problem isn’t it? There are many factors to consider. Other than the increased petrol usage which the driver would definitely consider, there’s also the question of ERP charges, and one could even take into account the maintenance cost due to wear-and-tear.
On the other hand, the purpose of carpooling is that it’s not supposed to be for profit. As a result, the agreed payment amount should be significantly lower than flagging down a taxi.
GrabTaxi tries to solve this with a new feature to their app – GrabHitch
The newly introduced GrabHitch function of the GrabTaxi app hopes to make this decision making process easier. Unlike the Uber app, which calculates the fare based on distance travelled and time taken, GrabHitch calculates the fare based on distance alone. This means that any other costs, such as ERP charges, will still need to be agreed upon between driver and passenger.
However, using the existing GrabTaxi framework, passengers can input a specific location as their pickup point on the app to avoid any confusion.
How does this help me as a passenger?
Well, cheaper rides that are still comfortable and convenient, for one! GrabTaxi claims that their GrabHitch service can save you half of what taking a taxi would cost you. Furthermore, you can make it even cheaper if you can find others who need to take the same trip, like colleagues or classmates who live near you.
Even though GrabHitch doesn’t allow more than one booking at a time, you can have as many fellow passengers as there are available seats in the car.
What if I want to be a driver? What’s in it for me?
Simply put, since you’re not allowed to go out of your way to pick up a passenger, you can only accept carpool jobs for a trip that you’re going to be making anyway. So why not earn something from it? Sure, you’re not allowed to make a profit, but at least you can defray the cost of your petrol. Think of it as getting a “free” trip to work – you only have to do the driving.
Furthermore, GrabHitch allows you to decide if you want to take a booking or not, so it’s not like you have to accept the booking if you’re not comfortable with it.
You also don’t have to worry about finding small change or handling grubby money and feeling like a taxi driver or a chauffeur. Using GrabTaxi’s GrabPay function, all transactions are cashless and are paid using the debit or credit card in the passenger’s app. GrabTaxi will then give the money to the drive once bank account details are provided.
Seems legit. What do I have to lookout for?
Ultimately, GrabTaxi isn’t providing the GrabHitch feature for free. They are a business after all, and this is something that’s been left out of most of the conversation about GrabHitch. In the terms and conditions, GrabTaxi states that “up to 20%” of each stipulated fare at the end of the journey is owed to the company as a “software usage fee”.
This is similar to the charge that Uber and GrabCar impose on their drivers. Except, you know, those drivers actually still manage to earn a profit.