Malaysia will allow motorcycle-hailing firms such as Indonesia's Gojek and local start-up Dego Ride to operate on a limited scale from January 2020.
Animesh Kumar, Director of Automotive Consulting at GlobalData, a leading research and consulting company, said it is a welcome move in Malaysia, in which ride-hailing user-penetration is nearly double than that of the overall Asia-Pacific region.
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"The country is among key motorcycle markets in the world," maintains Kumar. "The move will allow home-grown ride-hailing start-up Dego Ride to restart operations. More importantly, it paves the way for Gojek's entry in to the country, where Singapore-based Grab has been enjoying a near-monopoly after the exit of Uber from Southeast Asia.
Gojek was founded in 2010 with bike taxi e-Hailing and delivery services. Backed by investors including Alphabet Inc's Google, JD.com Inc and Tencent Holdings, the company is valued between US$9-10bn. Grab was founded in 2012 as a taxi aggregator before adding other services. After getting a big cash boost from SoftBank's massive tech fund in March 2019, the company is valued at US$14bn.
"Both describe themselves as a 'super app' that is intended to be a one-stop solution for customers for their daily needs including transportation, payments, food and entertainment. While Grab has covered all bases in core e-Hailing offerings, Gojek has strong portfolio of additional services such as delivery services, home cleaning and repairs," Kumar adds.
"Grab and Gojek have been competing in several markets including Indonesia, Singapore, Thailand and Vietnam. Malaysia will now be the new battleground and as a result drivers/riders as well as customers will benefit from the competition. In addition, the introduction of the new segment will increase the size of the ride-hailing market.
"Over the next six months, bike e-Hailing companies will be able to start limited operations and test the demand. Legalization and uptake of bike taxi e-Hailing will help Malaysia in its efforts towards strengthening the overall ecosystem of public transportation as bike e-Hailing is effective in offering first and last mile connectivity."
