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Business

Vietnam gives the nod to car-hailing service

HO CHI MINH CITY -- Southeast Asia's leading taxi app operator, GrabTaxi, will officially launch its transportation service using registered private vehicles next month in five cities across Vietnam, after receiving support from the government.

     GrabCar is a licensed private vehicle hiring service provided via GrabTaxi's ride-hailing smartphone app. GrabTaxi initially launched its GrabTaxi service here in February 2014, teaming up with local traditional taxi companies. Following its successful two-year track record, the company has won approval from the government to offer its flag ship service, GrabCar.

     The GrabCar service will start operating in Hanoi, Da Nang and Ho Chi Minh City, along with Quang Ninh and Khanh Hoa provinces, by the end of this year.

     It will be the first legally operated peer-to-peer service in Vietnam, while its rival Uber is still facing challenges from traditional taxi companies. Earlier this year, GrabTaxi also launched a ride-sharing and cargo delivery service called GrabBike in Ho Chi Minh City and Hanoi. A range of services will be offered via an integrated app.

     GrabTaxi is required to report lists of licensed taxi companies and vehicles on a regular basis to enable the authorities to manage taxes and check compliance with regulatory requirements.

     As of November 2015, the GrabTaxi taxi-hailing mobile app has been downloaded 8.7 million times, and has registered 156,000 drivers across Southeast Asia since it was launched in 2012 in Malaysia. Now it operates in countries including Singapore, the Philippines, Thailand and Indonesia.

     "This is the right time to offer our services in Vietnam, when we are seeing more people getting used hiring a driver through smartphones," Grabtaxi Vietnam Communication Manager Nguyen Trong Dan told the Nikkei Asian Review.

     GrabCar is a direct competitor to Uber, which offers services such as UberBlack, using premium cars, or UberX for cheaper rides in the region.

     According to market analysis firm SocialHeat, GrabTaxi has taken the lead with 62% online brand awareness in Vietnam, while Uber and EasyTaxi account for 21% and 17% respectively, in a market that includes around 40% of some 120 million mobile subscribers using smartphones.

(Nikkei)

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