ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Politics

Ride-hailing businesses face bumpy road in Japan

Legislative hurdles high, taxi industry mounting fierce objections

In Japan, the Uber app is used to hail taxis, not cars driven by ordinary drivers.

TOKYO -- A government deregulation panel launched talks here Tuesday on lifting the ban on ride-hailing services, but Japan will likely remain one of the few major economies in the world that keeps Uber from widely running its core operations -- at least for a while longer.

"The issues with ride-sharing services can be resolved," an official from Notteco, a company offering a hitchhiking-type service, told the panel's Tuesday meeting, proposing rules such as a ceiling on driver pay and required membership for users.

Currently Notteco links up long-haul travelers -- such as those visiting their faraway hometowns or ski vacationers -- with drivers who have available seats in their cars. But using private cars to ferry people for money is illegal in Japan, so drivers can get paid only for the cost of gas and tolls. Rolling back this ban would require a legislative amendment, and Notteco is lobbying for such a change.

"A structure where the driver alone is responsible for transporting people is a problem in terms of ensuring safety and protecting users," Transport Minister Keiichi Ishii told reporters Tuesday. Lifting of the ban "requires extremely careful consideration," he added.

The taxi industry is also opposing deregulation. "The number of taxis in Japan could shrink by half," said Ichiro Kawanabe, president of Nihon Kotsu, Japan's leading taxi operator.

But the Tokyo-based company has an idea to enhance the convenience of its taxi service. Kawanabe, who attended Tuesday's government panel meeting, unveiled Nihon Kotsu's plans to launch a taxi-sharing service this year, possibly using a smartphone app to connect passengers going in the same direction.

Taxi companies are not too worried at this point about players like Notteco, whose services are virtually limited to longer-haul trips. But they feel threatened by the prospect of a service offering both long and short rides with any motorist acting as a taxi driver.

Remote areas with inadequate transportation infrastructure are the only places in Japan where personal cars can be used lawfully for carrying fare-paying passengers. But even this system requires prior consent of the taxi industry, and service regions are limited as well.

(Nikkei)

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends October 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media