Regional ride-sharing giant Grab is an official partner of the Asian Games, which opens next week on August 18. However, there is a chance that a significant portion of Grab’s motorcycle taxi fleet will be spending that day demonstrating rather than taking passengers over the drivers’ unmet demands for a tariff increase.
Partner drivers for both Grab and home-born ride-sharing unicorn Go-Jek have held numerous protests over the last few months to demand a wage of IDR3,000 (US$0.25) per kilometer wage rather than the IDR1,600 per kilometer they average now. A meeting on Friday between members of the Two-Wheel Action Movement Presidium (Garda), a union representing motorcycle taxi drivers, met with representatives of the two companies for negotiations but, without any firm promises of a rate hike from either Grab or Go-Jek, Garda reps said the strike would still happen.
However, this week Grab announced that they would raise the minimum charge for each GrabBike trip from IDR5,000 to IDR7,000 which they claimed would raise the per kilometer rate for short-haul trips from IDR1,600 to IDR2,300 (however the company claimed the rate hike was not related to the Asian Games opening strike but rather a result of their normal algorithmically determined rate adjustments).
Garda representative Igun Wicaksono said that Grab’s increase was not as much as they claimed and that it was not enough to prevent them from striking.
“[Grab officials] say the tariff went up based on Grab’s own algorithm. However, the facts are on the ground and the basic tariff is still in the range of IDR1,200-IDR1,800 per kilometer,” Igun told Kompas today, adding that they would not settle for less than IDR3,000.
Igun said that Garda was still awaiting word from Go-Jek, which said they would consider a tariff hike following last Friday’s meeting. If they increased their fare significantly, Igun said they would consider discouraging their drivers from demonstrating.
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.