e-Hailing solution

KUALA LUMPUR: Uber and Grab may be legalised by year-end following an endorsement by the Special Economic Committee (SEC) chaired by Prime Minister Najib Abdul Razak.
A proposal to this effect was submitted by the Land Public Transport Commission (SPAD) last month and it also includes details to revive and transform the conventional taxi industry.
The "e-hailing" proposal is expected to be presented to the Cabinet for the final go-ahead later this month.
theSun understands that among the proposals for the conventional taxi industry is a profit-sharing concept or guaranteed percentage of the day's income for cabbies, similar to the business model practised by Jakarta's Blue Bird Taxi Company, Dubai Taxi Corporation and in other cities around the globe.
Dubbed as the first of its kind in the world, Malaysia's "e-hailing" model will create a level playing field between Uber drivers and conventional cabbies for efficient and well-priced transport services.
"A person offering his or her private vehicle as taxi service must obtain a public service vehicle (PSV) licence and register with SPAD for vetting purposes," a government insider said.
"Private cars used as taxis will be required to undergo annual inspections with Puspakom along with enhanced insurance coverage just like taxis," he said.
"Private cars with Asean NCAP ratings will be given priority in addition to the safety specifications set by the Road Transport Department."
It is expected around 130,000 new Uber and Grab drivers (full-time and part-time) will co-exist and compete in the saturated taxi market as a result of the "e-hailing" initiative. There are 67,000 active taxi drivers throughout the country with 36,000 cabbies in the Klang Valley. It is learned that the government is taking steps for Uber (the company) to be subjected to taxation when the e-hailing takes off.
"For a while, Uber passengers' credit card transactions have seen massive flow of the ringgit out of the country," the insider clarified.
It is also learned that the new taxi industry landscape will indirectly drive the taxi drivers to embrace third-party booking apps since the current usage rate among the cabbies nationwide stands at 14% while the consumers penetration for car-hailing apps is more than 50%.
When contacted, SPAD chief executive officer Mohd Azharuddin Mat Sah confirmed the presentation last Tuesday received positive response from the SEC.
“Now we are in the midst of fine tuning the paper to Cabinet in the next few weeks,” he said.
SPAD chairman Tan Sri Syed Hamid Albar said should the Cabinet give the green light, "several laws need to be amended such as the Land Public Transport Act 2010, Road Transport Act 1987 and Communications and Multimedia Act 1998."
“The legislation process may take place during this month or October sitting in Parliament. Currently, we are working closely with Transport Ministry and Malaysian Communications and Multimedia Commission,” he said.
“If everything goes well, a new dawn of taxi industry may begin end of the year,” Syed Hamid added.