Hot Topics: Uber’s vision for modernising Hong Kong transport – from taxis, to minibuses and beyond

There are 164 operators running 3,343 green minibuses across 600 routes. Regulated by the government, they have fixed routes, fares, bus stops and schedules. Their drivers are company employees with fixed salaries.

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Some 1,007 red minibuses also operate in the city. They are unregulated and are nicknamed “desperado minivans” for the way they speed along highways at night. Their drivers either own or rent the vehicles. They set their routes, allow passengers to hop on and off anywhere, and raise their fares when demand goes up.

Uber’s ambitious plan to work with the city’s transport operators faces numerous hurdles. Although the company has been operating in Hong Kong for seven years, its ride-hailing services are not legal without a hire-car permit. The firm has been under attack by the taxi industry, which has 40,000 drivers for 18,163 licensed cabs.

The government issues only 1,500 permits for private hire-car services, so this means many Uber drivers are picking up passengers illegally.

Despite this, the firm bought HKTaxi, the city’s most popular cab app, in August. This move entrenched its ride-hailing service deeper in the Hong Kong market. More than 70,000 registered cab drivers – full-time, dormant and part-time – have signed up for the HKTaxi app.

The deal is expected to complement Uber Taxi, which was rolled out last October. This service charges passengers flexible fares rather than by the meter. According to Uber, taxi drivers reported earning about 20 per cent more via the taxi platform than from street hails.

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HKTaxi app co-founder Kay Lui said he hoped the partnership would change the negative public perception of local taxi drivers.

Lui said many residents incorrectly believed that local drivers were “relatively bad” in general, while reviews from customers for cabbies using the two platforms were largely very positive.
Staff writer

• What is your overall impression of Uber’s ride-hailing service in Hong Kong, and why? List two differences mentioned in Context between Uber and street-hail cabs.

• How are red minibuses different or similar to Uber’s ride-hailing services? Explain your answer using Context and Glossary.

• Using information from Context, what opinion of Hong Kong’s taxi industry does the cartoon hint at?

• Based on your answer above, is this criticism as common with Uber cabbies? Explain using Context and your own knowledge.

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Uber’s plan to partner with Hong Kong’s minibus operators could already be a non-starter before discussions take place, with industry officials dismissing it as “totally unrealistic”.

Chau Kwok-keung, chairman of the Hong Kong Taxi and Public Light Bus Association, dismissed it out of hand.

“Unless Uber has ditched its illegal ride-sharing business, there’s no room for the minibus sector to cooperate with Uber,” Chau said.

According to industry leaders, the city’s minibus industry has been struggling for survival, with up to 900 vehicles – about 20 per cent of the city’s 4,350 licensed public light buses – left idle over the past year by the coronavirus pandemic.

“Minibuses are something that could bring really interesting opportunities,” said Estyn Chung, Uber’s general manager in Hong Kong.

“What we would do is to provide a way for minibus operators to manage ticketing, routing, algorithms and pricing.”

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Chung refused to say if Uber had approached any of the city’s minibus operators about its idea.

The idea would entail linking Uber’s digital operation with an operator’s ticketing system, while also providing other services, such as real-time traffic data.

Chung said passengers would benefit from being able to pre-book a seat on a minibus using the Uber app.

“If you are a consumer waiting for a minibus at peak hours and it’s come along full, that’s a very frustrating moment,” he said.

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Other benefits, Chung said, would be helping operators manage the frequency of their services during rush hour and other busy periods. A similar partnership had already been tried in other cities, such as Cairo and Delhi.

“I think we are still experimenting with what the right models look like around the world,” he said. “It’s absolutely feasible in Hong Kong ... The idea is to help transport become more efficient, a win-win for everybody.”
Staff writer

• List ONE reason that minibuses should work with Uber, and ONE reason the potential partnership might pose difficulties for minibus operators. Explain each reason using information from News and Context.

• Using your own knowledge and News, identify and elaborate on ONE group of residents who might be left out if an Uber-minibus collaboration were to move forward.

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Hong Kong’s taxi industry is trying yet again to persuade the government to clamp down on Uber. The industry wants all private vehicles with neither a taxi licence nor a valid hire-car permit for carrying passengers for payment to be banned from Uber’s app.

The taxi operators’ latest salvo in a long-running battle to curb rival Uber came after the popular ride-hailing service acquired HKTaxi, Hong Kong’s most popular cab app, in August.

“Uber has spent a lot of effort investing in the taxi industry. This transaction reflects that we are committed to investing in the development of the industry in Hong Kong,” said Uber Hong Kong’s general manager Estyn Chung.

Chung added he was dismayed at the government’s refusal to set up a regulatory framework in the city to legalise Uber’s ride-hailing services, despite the firm’s repeated requests.

Chau Kwok-keung, chairman of the Hong Kong Taxi and Public Light Bus Association, on the other hand, said a loophole in the law allowed firms such as Uber to escape liability. He said a new law was needed to crack down on illegal ride-hailing operations and prosecute firms rather than drivers without a hire-car permit.

Meanwhile, Quentin Cheng Hin-kei, spokesman for commuter concern group Public Transport Research Team, said he wished the city’s taxi industry would stop harping on about ways to crack down on Uber.

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“The taxi sector should instead seek ways to improve its service and learn to coexist with Uber,” he said.

“After all, Uber has become part of Hongkongers’ daily life. The taxi industry should accept this reality and strive to achieve a win-win situation for themselves.”

Cheng added the government should open up the ride-hailing market with a simplified regulatory regime.

“[The] highly restrictive hire-car permit system has in fact hampered transport development in the city,” he said.
Staff writers

• Identify the main reason Uber’s ride-hailing services are unable to operate legally in Hong Kong. Who should be responsible for fixing this situation, and why?

• “Hong Kong should do away with its current hire-car permit system to encourage a more robust and efficient transport industry.” Using News, Issue and your own knowledge, elaborate on ONE argument supporting this suggestion and ONE opposing it.

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Green minibuses: serve areas that standard Hong Kong bus lines cannot reach, such as those with narrow and winding roads. Green minibuses operate a scheduled service, with fixed routes and fixed fares.

Red minibuses: run on a non-scheduled service. Red minibuses tend to be privately owned, and set their own routes and fares. As such, some red minibuses run throughout the day on certain routes while others only run within certain hours.

Hire-car permit: refers to a licence issued to car owners or drivers to allow the use of private vehicles for transporting passengers for hire or reward. The Transport Department currently issues the following types of hire-car permits: hotel services for transporting guests of a designated hotel; tour services for transporting clients of a designated tourist agency; private limousines for transporting clients of a contracted company, or individuals requiring personalised high-end transport; private limousines specifically for cross-border trips; private services for transporting individuals in areas where there is inadequate transport.

HKTaxi: an app that allows people in Hong Kong to book taxis

Ride-hailing service: also commonly referred to as private hire-car services. Customers usually will order a customised ride online using a smartphone app.

Uber: a US-based ride-hailing service that allows passengers to request a ride from private drivers, who usually own their own vehicles. Uber uses an algorithm to decide the rate that customers are charged. The company incentivises drivers to pick up customers during peak hours by charging higher fees during those times.

Uber Taxi: an extension of Uber’s ride-hailing service to include licensed taxis in Hong Kong. Uber Taxi uses the same platform as Uber, allowing customers to pay via the app and track the vehicle they have called.