Grab seeks P20 hike in base fare

By: Tyrone Jasper C. Piad - 2 years ago

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MANILA, Philippines — Grab Philippines is asking for a P20 hike in base fare to provide its partner drivers a much-needed relief from the series of fuel price increases, which have slashed their earnings and to encourage more commuters to use its platform amid higher demand for ride-hailing services with the reopening of the economy.

Ronald Roda, senior director for strategy and operations of Grab, said they were set to attend a hearing with the Land Transportation and Franchising Regulatory Board (LTFRB) on June 29 on their petition.

“We had to do it (base fare hike proposal) not for us but because our drivers are asking for it. We did it for our drivers,” he told the reporters on the sidelines of Grab’s 10th anniversary celebration last week in Pasay.

Roda estimated that about 10 to 20 percent of their drivers’ earnings were cut as they have to pay more for gas.

A P20 fare hike could mean an additional P200 in the drivers’ pockets everyday, given they now only service 10 rides on the average daily, he noted. At the height of the stricter lockdowns, a driver could accommodate more—up to 14—because there was no heavy traffic, he said.

“That’s what we’re just asking now. It’s not a full price increase but something that is faster just to be able to help the community,” he explained, noting that a more comprehensive study and dialogue was needed to implement an overall change in the fare matrix.

Financial challenges

Based on its app, a passenger pays a base fare of P40 to P50 for GrabCar services and an additional P15 to P18 per kilometer. Minimum fares are P80 to P120 per ride. GrabTaxi, meanwhile, has a flag down rate of P40 with additional P13.50 per kilometer.

The base fare hike could also entice more drivers into the platform, he said, explaining that about two-thirds of its 65,000 drivers have quit in the past years. The financial challenges brought about by the pandemic led to the repossession of “a lot” of cars, he said.

The LTFRB recently opened 8,000 slots to replenish the driver supply but Roda said these were “currently being filled up very very slowly” as high gas prices make it difficult for Grab to “attract” potential driver partners.

“They’re scared that gas prices are gonna go up, they’re not gonna make money. So buying a car is a big capital decision for a lot of people,” he explained.

The lack of Grab drivers on the road has been felt as consumers find it harder to book a ride.

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