Gojek comes to Singapore

After much anticipation (and suffering under a monopolised ride-hailing market), Gojek launched a beta version of its app in Singapore on 29 November. President of the Indonesian ride-hailing firm, Andre Soelistyo, told local media that they will “begin the roll-out” of their services and will fine-tune its app “to make sure it meets the high standards expected in Singapore”.

In the first few weeks, Gojek said dynamic pricing (i.e. where fares rise when demand goes up) will not be adopted and fares will be distance-based. Dynamic pricing will be introduced at a later date. The app can currently be downloaded from the Apple and Android app stores, and a full launch will most likely be held early next year. Hurray!

Gojek2

The following are some quick facts about Gojek’s beta launch:

– Only rides beginning and ending in the eastern and south-central parts of Singapore will be available during the beta phase.

– The minimum fare for Gojek rides is S$6.

– The beta app DBS or POSB customers will be given priority to book rides.

Lower Ride Fare for Commuters (or not…)

Gojek’s entry has been highly anticipated by Singaporeans after Uber was acquired by Grab in March this year, which allowed for Grab to monopolise the market. Following the merger, many commuters noticed a lack of discounts and promo codes. Although Grab prices remained the relatively the same, more commuters were paying the full price for their rides. Many commuters also noticed outrageous surges in fares, even during non-peak periods. Hopefully, with a competent competitor like Gojek, commuters can look forward to a (slight) drop if ride fares.

However, this might not be the case. In the same interview with local media, Soelistyo hinted that promotions might not be as aggressive as it was during the days when Grab and Uber started off in Singapore. He added GoJek’s focus will be on building a differentiated product rather than “market building” and hoped that “pricing is not the key determinant of choosing one over the other”.

It is unfortunate that Gojek seems to underestimate the importance of competitive ride fares as only a small portion of Singaporeans are willing to pay extra for better/additional services. In addition, it is also highly unlikely that Gojek’s services would be significantly superior to Grab. Even so, there is nothing stopping Grab from trying to copy them. Sigh…

Gojek3

Better Incentive for Gojek Drivers

Local media also reported that thousands of drivers had registered on GoJek’s portal just a few hours after its launch on 26 November. Many drivers were excited and hope for better work conditions under Gojek as Grab drivers often end up working long hours to make ends meet.

Despite our disappointment in not having low fare rides, we are happy that Gojek places a strong emphasis on good remuneration of their drivers. It listed several incentives, including promising drivers minimum earnings of S$30 for every hour they have the app running during peak periods, and S$15 for non-peak hours. Drivers also earn a minimum of S$20 for every trip they complete on Thursday and Friday. This will provide a an alternative for private hire drivers who are unhappy under Grab.

Initial users of Gojek are providing positive feedback of the app, which appears to be on track to becoming a reliable alternative for commuters. While Grab welcomes the competition, we hope that Gojek’s presence in Singapore will shake things up (and result in more promotions and lower fare prices for commuters). One can only hope that Gojek does well and not end up like Ryde, who had very little success penetrating the market. We shall wait and see!

Gojek4