The Malaysian Insight

E-HAILING firms are set to lose half of their drivers when its public service vehicle (PSV) licensing requirement comes into effect on July 12.

Most drivers, especially those working part-time, said the requirements add to the burden of cost and time to an already highly competitive industry.

Putrajaya announced recently that all vehicles used for carrying public passengers will now require a PSV in a bid to level the playing field between e-hailing companies and traditional taxis. The requirement comes into force on July 12.

Malaysia e-Hailing Drivers’ Association (MeHDA) chairman Daryl Chong said many part-time drivers are planning to quit by then.

“I think during peak hours, the reduced number of drivers will cause a price spike according to price calculations such as those used by Grab,” he said.

“The lack of drivers in certain areas will also cause difficulties in getting a car.”

Chong told The Malaysian Insight that the lack of drivers after July 12 could last for up to six months, before some decide to return.

“It is estimated that there are about 170,000 e-hailing drivers around, that’s about 85,000 fewer.

“By January 2020, we believe the remaining drivers will understand that their companies will actively comply with government regulations and the number of drivers will go back up to about 70% of the original.

“To our understanding, there are definitely part-timers who are throwing in the towel. We hope that they’ll reconsider and take the PSV examination so they can continue working part-time as a side income.”

The government said earlier apart from the PSV, e-hailing vehicles must now have insurance for both cars and passengers, and the vehicles must be examined each year while the PSV is renewed annually.

E-hailing company Dacsee operations manager Andrew Chua said the company will absorb the cost of the PSV licence but many drivers remained apprehensive about sitting for the test and passing the Puspakom vehicle inspection.

Chua told The Malaysian Insight that his company also expects a massive loss in drivers in the short-term after July 12.

Malaysian Grab Drivers’ Association president Arif Asyraf Ali said the loss of drivers is inevitable and counts it as “the latest in a series of trials for the e-hailing industry”.

“The government has already set conditions for e-hailing drivers, including physical examinations, insurance, driving licence and having their cars examined by Puspakom if they’re older than three years.

“Inspecting the vehicles takes the longest time and many other terms and conditions are also causing drivers to waste time and money,” he said.

Stemming the exodus

Following appeals by e-hailing operators, Transport Minister Anthony Loke said recently drivers for the three biggest e-hailing companies in the country – namely Grab, Mycar and Dacsee – would now be allowed to take the PSV courses online to cut down on time and cost.

Chua from Dacsee said thanks to the e-learning implementation, the company expects about 20% of the drivers planning to leave because of the PSV requirement to reconsider their decision.

“Before this, the government had set a maximum price for PSVs at RM200 but different training centres have different prices and some also have hidden costs and they could total to RM400, with retaking the examination costing up to RM45.

“With e-learning, it is much cheaper. Dacsee’s drivers can print out the manual for only RM5, with an RM50 examination fee, and can even get RM30 e-wallet rebates. For companies as big as Grab, they can bear the costs entirely while Mycar’s drivers need to pay RM59.

“Compared to the costs before, drivers save about RM150.”

Chua’s company will contact all its drivers in a bid to convince them to stay and take the online PSV certification.

“Before this, you needed a day to study the course, now you can do it online and the examination and book costs have been reduced. I hope they can take some time to study and get their PSV licence.” – July1, 2019.