‘Carmageddon’? E-hailing firms foresee rides could cost up to 50pc more from Friday

KUALA LUMPUR, July 8 — Several e-hailing companies have cautioned passengers to expect to pay higher rates and longer wait times for rides starting July 12 when the Public Service Vehicle (PSV) deadline hits.

This is because of a lack of e-hailing drivers who have the compulsory PSV licence — which costs RM115 a year and is required by the government — and annual vehicle inspections at Puspakom, The Star reported today.

“We will see fewer drivers when the deadline comes because many part-timers are opting out; plus many other drivers are still not PSV ready,” Malaysia E-hailing Drivers Association (Mehda) president Daryl Chong, whose group holds the biggest representation for the industry in the country, told the national daily.

Chong predicted the fees could rise as much as 50 per cent.

“Passengers will have to wait longer because the distance between them and the drivers will be much further,” he added.

Chong said e-hailing companies use algorithms to match supply and demand and the surcharge on fares are already in practice with a 100 per cent cap set by the Land Public Transport Agency.

“For example a RM10 ride can be RM20 during peak hours as companies give incentives to drivers to pick up passengers during peak hours in the morning and evenings.

“But higher fares would mean fewer passengers. So they will mostly keep the increase minimal, at perhaps RM15 so that passengers are not badly affected.

“If this mechanism is applied outside the deadline, fares will certainly increase,” he added.

The Transport Ministry revealed on Tuesday that only 16,338 drivers out of 167,000 registered — or under 10 per cent — have signed up for their PSV test. 

And of that figure, only 10,151 drivers are PSV-qualified to date, though Chong believes the number will increase by year’s end to 70 per cent of drivers registered with e-hailing services.

Grab Drivers Malaysia Association president Arif Asyraf Ali told The Star he predicted the industry will come to a halt on July 12 calling it “Carmaggedon”.

MyCar founder Mohd Noah Maideen said they are trying to get more drivers unto their platform to prepare for the upcoming shortage.

MyCar is the second biggest ride-hailing company with 70,000 registered drivers. 

“This is our focus now as we believe most are full-time and they may support our services,” Noah told The Star.

Despite all that, economists feel fare prices won’t increase as affordability is among the reasons passengers turn to them.

Alliance Bank Malaysia chief economist Manokaran Mottain felt the fares were bound to go up once regulation kicks in.

“Sometimes when you have the peak-hour charges the prices are really expensive.

“Eventually I think they can’t sustain this kind of business. Customers will always choose what is cheap,” Manokaran said.

Sunway University economics professor Yeah Kim Leng echoed a similar view. 

“If they hike up their prices they will lose their market share. It would not be in their best interest to do so. 

“They will be under scrutiny when the regulations kick in,” he was quoted saying.

Mehda’s Chong too did not discount the possibility that the e-hailing companies would absorb the price difference to keep their customer base happy.

He also expects 70 per cent of drivers to be PSV ready by year end.