“A virtual monopoly in the transport network vehicle service sector now exists with the official withdrawal of Uber after selling out to competitor Grab.”
This according to Quezon City Rep. Winnie Castelo, chairman of the House Committee on Metro Manila Development.
“The government, through the Land Transport Franchising Regulatory Board (LTFRB), can remedy the situation by allowing more transport network companies (TNCs) to offer services,” said Castelo.
“It is incumbent upon LTFRB to protect the interest of commuters, so it must expedite the entry of competitors to Grab,” added the administration stalwart.
It is incumbent upon LTFRB to protect the interest of commuters, so it must expedite the entry of competitors to Grab.
Four local firms have applied for TNC licenses, namely Pira, Lag Go, Owto, and Hype.
The veteran legislator earlier urged the government, through the Board of Investments (BoI), to provide incentives to small local companies that will be formed to challenge the dominance of Grab.
“The entry of more local players in the TNC business is needed to dissipate Grab’s domination of the industry,” the seasoned lawmaker said.
Grab’s monopoly is starting to manifest in the list of complaints received on sudden spikes in its rates.
Castelo acknowledged Grab’s explanation that the rates were still within the bounds approved by the government but it is now far higher than what was being offered when a healthy competition existed in the ride-hailing vehicle business.
The surge in Grab’s rates is particularly evident during rush hours when the usual fare doubles supposedly due to high demand.
Incentives similar to those given to pioneering businesses such as income tax breaks should be provided to new TNCs, primarily local firms.
“Incentives similar to those given to pioneering businesses such as income tax breaks should be provided to new TNCs, primarily local firms, to encourage competition that will redound to the benefit of the public,” Castelo concluded.