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Business

Vinasun adds Vcar app to compete with Grab, Uber

Vinasun is adding a new hailing app and unmarked minicabs to supplement its familiar fleet of taxis in Ho Chi Minh City.

HO CHI MINH CITY -- Vinasun Taxi has launched its own app for unmarked minicabs in its latest move to compete against Uber and Grab Taxi services.

Vinasun's unmarked Vcar service offers seven-seat Fortuners and four-passenger Camrys, and mainly operates in and around Ho Chi Minh City, Vietnam's commercial capital.

Nguyen Bao Toan, Vinasun's deputy managing director, told the Nikkei Asian Review that the Vcar service is based on the company's taxi-hailing app, and was first introduced for VIP and business customers.

The service has proved popular for business meetings, and occasions like weddings and birthdays.

According to Vinasun, passengers using the apps for traditional taxis or minicabs pay similar prices.

The company is also having to compete with the thriftier ride-sharing services offered by Uber and Grab.

Last year, Vietnamese authorities promised to develop a framework for ride-sharing services after traditional taxi associations demonstrated against unfair competition from Uber.

Grab Taxi, which originated in Malaysia, has been running pilots in five Vietnamese cities using both liveried taxis and unmarked minicabs. The company got positive feedback from drivers and passengers -- and tax collectors.

Uber, on the other hand, faces a tax bill. Last week, the local revenue department said it has not collected enough tax from Uber Vietnam, and warned of tough action.

Vinasun Group is the second biggest taxi operator in Vietnam, with some 6,000 cabs, concentrated in and around Ho Chi Minh City. The company has been listed on the Ho Chi Minh City Stock Exchange since 2008, and expects 4.4 trillion dong in revenue ($197 million) this year, up slightly on last year. Targeted net profit of 264 billion dong ($12 million) is 20% down year on year, however. Vinasun attributes the weak performance to the challenge from outside high-tech operators and a recovery by Vietnam's largest taxi operator, the Mai Linh Group.

A Vinasun representative said the company may lack the finance, infrastructure, and access to technology to compete with the new foreign competition, but will endeavor to adapt.

"If the Vietnamese government sets out clear service regulations, and provides a fair environment, we are ready to expand," said Nguyen Bao Toan.

(Nikkei)

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