Uber, the world’s biggest ride-hailing service, officially launched operations in Phnom Penh yesterday after nearly three months of trial operations, during which the transportation giant’s representatives worked closely with the government to create a regulatory framework to support ride-hailing services.
Brooks Entwistle, Uber’s chief business officer for the Asia Pacific region, said the official launch in Cambodia – the 78th country in the company’s global portfolio – “signifies our ongoing momentum across Southeast Asia”.
He said he expected the company’s shift to full operations would have a positive impact on unclogging the capital’s congested streets while offering affordable ways for riders to travel and creating income opportunities for drivers.
“The technology that Uber uses for ride-hailing has changed how cities all over the world, especially in Southeast Asia, [free up congestion,] allowing people to move much more efficiently,” he said.
Entwistle credited strong government support for paving its entrance into the Cambodian market, adding that this was one of the first instances for the US-based company to launch operations in a country with ride-hailing regulations already in place.
“This is one of the first countries we have entered into that already had a dedicated ridesharing framework in place,” he said. “[The government’s] regulations are incredibly forward-thinking, and we think this can be used as an example for many cities and municipalities as we continue to grow.”
Uber has faced hurdles in numerous countries, including regulatory issues and a backlash from strong and established taxi industries. Thailand earlier this year cracked down on drivers it said were improperly insured or registered, while Vietnam this week slapped the company with a $2.9 million bill for unpaid taxes as Uber fended off rumours it was pulling out of the market.
While neither Uber nor government officials attending yesterday’s Cambodia launch event were willing to disclose details of the new regulatory framework, a source involved in drafting it said one of the key clauses states that drivers employed by local taxi companies can supplement their incomes by working simultaneously as private contractors for ride-hailing services without breaching their existing work contracts.
Additionally, the source said the Ministry of Public Works and Transport (MPWT) has streamlined procedures to make it easier for ride-hailing platforms to verify that prospective drivers have a valid driver’s licence, vehicle registration and a safe driving record.
Pheng Sovicheano, a secretary of state at MPWT, said the ministry’s six-month collaboration with Uber demonstrated the government’s commitment to enabling a safe and reliable modern transportation system while creating “shared mobility” regulations.
“The launch of Uber demonstrates how the government and industry can work together to take advantage of new technology,” he said.
Valentin Vermersch, a launch specialist for Uber based in Singapore, said the company has also forged a strategic partnership with local mobile operator Smart Axiata. Under an agreement, Uber drivers are provided free access to data on Smart’s network while on the job.
“With Smart’s support we can ensure that drivers receive a data package that is free of charge when operating,” he said, adding that further details of the partnership would be announced shortly.
Uber’s late entry into the Cambodian market will put the ride-hailing giant up against established homegrown platforms such as Exnet, iTsumo and PassApp. The company could also face stiff competition from Grab, Southeast Asia’s biggest ride-hailing platform and a fierce rival in other regional markets. Grab has confirmed plans to launch services in Cambodia, though has not announced a date.
Vermersch was upbeat about the prospects for a vibrant ride-hailing market.
“Cambodia has good mobile connectivity, a growth of tech-savvy users and has maintained sustainable economic growth,” he said, adding that while Uber’s platform would currently be limited to taxis, the company would consider extending the service to include tuk-tuks and motorbikes.
Uber began trials of its mobile application in Phnom Penh in June, offering free rides for selected users to test the service. While company representatives declined to provide figures on how many drivers or passengers have used the service, a quick search on the mobile app yesterday morning showed seven active drivers in the area around Koh Pich.
“We are committed to signing up more drivers in the future as riders become familiar with the service,” Entwistle said.