LOOK: This Airline Company is Launching a Ride-Hailing Firm in the Philippines
The company is already offering ride-hailing services in other countries such as Malaysia, according to its CEO. Here’s how it’ll impact Filipinos and the industry as a whole.
Mobility has been a prevalent concern in the Philippines and with that, ride-hailing services became popular. In fact, to date, user penetration for shared mobility is at 89.3% in 2023 and this is expected to increase to 89.6% by 2027. Likewise, the number of users is expected to hit 81.24 million by 2027.
Meanwhile, from a business perspective, the revenue of the ride-hailing and taxi segment in the Philippines is projected to reach $970 million (approximately PHP 54 billion) this year, which means that a new player is keen on entering the market
Tony Fernandes, the CEO of Capital A Berhad (formerly known as AirAsia Group) has revealed the company’s plans to launch a ride-hailing firm in the Philippines. And according to a report by ABS-CBN News, this move is seen as a challenge to ride-hailing company Grab.
“We want to launch our ride-hailing services here and provide some competition to Grab,” says the Capital A Berhad CEO. “We think we will be more affordable and obviously we can make a huge dent at airports.”
To date, the company already offers ride-hailing services in other countries, including Malaysia.
How This Can Help the Filipinos
The ABS-CBN News report points out that Capital A Berhad’s ride-hailing firm is “unique since it plans to hire full-time drivers who are entitled to benefits such as insurance.” Furthermore, it is projected to generate around 2,000 jobs in the country in the next two to three years, with CEO Tony Fernandes noting that this number can grow especially if the venture succeeds in the country.
When asked when the ride-hailing firm is expected to launch, he assured that it will be soon.
Ride-Hailing in the Philippines
Ride-hailing is a growing market here in the Philippines with revenue expected to show an annual growth rate (CAGR 2023-2027) of 1.97%, according to Statista. This means that the market volume is expected to reach $1.05 billion (approximately PHP 58.86 billion) by 2027.
Statista likewise notes that Grab remains the main key player in the market, given that the company had an 88% brand share in 2022. But with this new player, Filipinos can expect more options for ride-sharing and ride-hailing services, as well as more livelihood opportunities for drivers—but this time with the promise of job security and benefits.