One of the most remarkable changes to daily life in Jakarta and many other cities in Indonesia is the recent rise of ride-hailing services like Go-Jek and Grab that have hugely increased the number of convenient transportation and delivery options. But instead of being able to show off the industry’s innovations to visitors coming to the capital for the upcoming Asian Games, motorcycle drivers working for the two companies might create chaos instead.
Online ojeks (the local term for motorcycle taxi drivers working for app based ride-hailing services) have been protesting for months over the current minimum fares paid to partner drivers by Go-Jek and Grab, which are currently set at just around IDR1,600 (US$0.12) per kilometer. They previously threatened to hold a massive strike involving “2 million” drivers starting August 18, the day of the Asian Games opening ceremonies, if their demands for a higher rate were not met.
On Friday, members of the Two-Wheel Action Movement Presidium (Garda), a union representing motorcycle taxi drivers working for Go-Jek and Grab, met with representatives of the two companies for negotiations facilitated by The Jakarta Police’s Intelligence Directorate. According to Garda representatives, the meeting did not go well and their plans to strike on the 18th were still going forward.
Igun Wicaksono, a Garda representative, told the media that Go-Jek’s management said they would at least consider their demand to raise the tariff to IDR3,000 per kilometer. But he said that Grab’s negotiators were not willing to budge.
“Grab’s management rejected our demands. It was as if they were encouraging us to go ahead with our plans to demonstrate at the opening of the 2018 Asian Games. They were not cooperative,” Igun told Kompas, adding that there were not yet any plans for further negotiations before the start of the massive regional sporting event.
During a major demonstration in front of the Presidential Palace in April involving thousands of drivers, President Joko Widodo himself met with representatives from the driver’s side and instructed his transportation and IT ministers to meet with representatives of Go-Jek and Grab to find a solution. The companies made tentative promises to increase their tariffs upon review, but have yet to make any major rate hikes, claiming that increases in fares would lead to lower demand and lower overall salaries for drivers.
Both Go-Jek and Grab have raised billions of dollars in investments to fuel their competition for market share in Indonesia and throughout the region, with Go-Jek raising over USD1 billion this year alone from numerous investors including Google.