Faring badly: Uber struggles to make inroads in Japan
Faring badly: Uber struggles to make inroads in Japan
Japan, with its wealthy customer base and megacities like Tokyo, should represent rich pickings for Uber.
In 2015, the national market for taxis had a turnover of 1.73 trillion yen ($15.2 billion), according to transport ministry data.
There are 50,000 taxis in Tokyo alone — instantly recognizable with their impeccable polished exteriors and doors that open automatically to let valued customers board effortlessly.
And with hailing a taxi rarely taking more than a few seconds in the major cities, there has been sluggish take-up of Uber, where consumers order an unlicensed car via smartphone.
“Japanese people don’t like taking risks, they are risk averse. They are quite strict when it comes to the quality of service,” said Ichiro Kawanabe, CEO of Nihon Kotsu, the main Tokyo taxi firm founded by his grandfather in 1928.
Given this, “when Uber tried to messily enter the market, no one wanted them,” Kawanabe, who is also chairman of the Japanese taxi federation, told AFP.
Uber also ran up against local legislation — it is strictly forbidden to operate a taxi without a license.
So it tried to enter the Japanese market via another route, setting up a pilot carsharing service in 2015 in the western city of Fukuoka.
Uber said it was a study into the needs of the local community but authorities quickly slammed on the brakes, saying it could be considered an unlicensed taxi service and raising questions of safety.
Kawanabe also pointed to safety issues as being among the reasons Uber had not enjoyed the same success in Japan as it has elsewhere.
“When an accident happens, they don’t take responsibility and say they are just a platform provider. Japan cannot accept this.”
An Uber spokesman said the company’s priority in Japan was to “partner with taxi companies to get licensed drivers using the app to connect with riders.”
The firm has started another pilot system in two rural towns connecting senior citizens with people willing to drive them around and this time the authorities have not clamped down, as it compensates for a lack of public transport and taxis in the areas.
Japan is also a “very important” market for UberEATS, its take-away food delivery service, the spokesman said.
And Kawanabe, a suave and charismatic 47-year-old known as the “prince of taxis,” admitted that Uber had been useful in foisting change on the conservative Japanese taxi industry.
Around nine out of every 10 cab rides in Tokyo is hailed or taken from a rank, with only 10 percent ordered via smartphone, said Kawanabe.
The main reason for this is that fewer than half of the taxis in Tokyo are connected to a smartphone, he said.
“They still use old feature phones instead of smartphones. It’s very difficult for us and app operators to convince them to use apps,” he complained.
In addition, around 80 percent of taxi fares are paid in cash.
This conservatism — combined with excellent public transport systems — led to a decline of one third in taxi passengers between 2005 and 2015, according to the transport ministry.
The industry is just starting to fight back — dropping fares for short rides around Tokyo, for example.
“It took me two years to convince them (to reduce fares) ... and there is still so much that needs to be done,” said Kawanabe.
He has set up a start-up subsidiary, JapanTaxi, to develop apps to connect drivers with passengers and aims to launch a carsharing app next year to push down costs.
But the competition is ferocious.
On the app front, Chinese app developer Didi Chuxing is expecting to launch in Tokyo next year, in partnership with a rival taxi firm.
And Uber is hoping for a large investment from Japanese communications behemoth Softbank.
Between Kawanabe and Uber, there is no love lost.
“They are just so rude, in every way. They think they are like gods and that we are so obsolete,” he said.
“From the point of view of the Japanese taxi companies, you can only call them ‘devils’.
Egypt hikes gas prices by up to 75 pct in IMF-backed austerity plan
- The increases follow hikes to fuel, electricity and public transport prices
CAIRO: Egypt said on Saturday it was raising the price of natural gas for home and commercial use by up to 75 percent, the latest move in an IMF-backed austerity program that has left many Egyptians struggling to make ends meet.
The increases follow hikes to fuel, electricity and public transport prices that are part of a $12 billion IMF loan program signed in 2016 that aims to lure back investors and lift the economy battered by political turmoil since 2011.
The government statement published in the Official Gazette said that, effective Aug. 1, the price for consuming up to 30 cubic meters of gas had been set at 0.175 Egyptian pounds ($0.0098) per cubic meter, up from 0.100 pounds.
The price for consuming between 30 and 60 cubic meters was set at 0.250 pounds, up from 0.175 pounds, while consumption of more than 60 cubic meters was set at 0.300 pounds from 0.225 pounds.
The statement did not specify the timeframes over which the consumption levels apply. But officials said they covered the usual billing period, which is monthly in Egypt.
Price hikes under the three-year IMF program helped drive up Egypt’s annual urban consumer inflation rate to 14.4 percent in June. Analysts said the impact of cutting energy subsidies was feeding through to the broader economy faster than expected.
($1 = 17.8500 Egyptian pounds)