May 22, 2022 2:12 PM
KUALA LUMPUR: The government will monitor e-hailing services from time to time as well as gather and analyse information before any changes are made, including the proposed fare regulatory mechanism.
The Land Public Transport Agency (Apad) said factors such as the working environment of drivers, passengers, service providers, and others must be taken into account to ensure balanced supply and demand.
This follows complaints from passengers regarding the current e-hailing price surge and driver shortage, especially during peak hours.
The service fare was reported to have increased up to 400% during peak hours, triggering dissatisfaction among passengers and consumer groups.
They also called for government intervention, among others, including implementing an e-hailing fare regulation.
According to the agency, the concept of e-hailing service involves mutual agreement between users and service providers for travel bookings through an application that displays the fare amount. Users have the option to continue with the booking or not.
“To date, there are more than 10 major e-hailing service providers offering the service,” the agency said.
Meanwhile, Universiti Teknologi Malaysia (UTM) senior lecturer Nur Azam Anuarul Perai said the proposal to regulate prices, such as setting a ceiling price, may cause a shortage of drivers as they could quit due to inadequate returns.
“Price hikes mostly occur during peak hours when demand is usually higher. The situation will be worse if no driver agrees to respond to passengers,” he said.
Nur Azam said any hike in fares was not necessarily due to monopoly practices but influenced by many other factors.
He said the high demand and the existing supply challenges were among the factors contributing to the rise in fares.
This has created a seller’s market, namely a situation in which the price is set by the seller or service provider.
“This is an inevitable phenomenon in the free market environment where prices are influenced by demand,” he added.
Nur Azam also ruled out the existence of elements of monopoly in the industry as there were no restrictions for any party to set up an e-hailing company.
The absence of price control could also encourage competition among companies to offer reasonable prices.
Meanwhile, Federation of Malaysian Consumers Associations (Fomca) deputy president Yusof Abdul Rahman hoped that more competition would exist among e-hailing companies to ensure consumers get satisfactory services at reasonable prices.
“The quality of e-hailing service is now being equated with the previous taxi services (before the existence of e-hailing) where the price was too high and unreasonable, especially during peak hours.”
He said the authorities should probe the alleged monopoly elements in the industry.