Following its launch in Vietnam under the brand Go-Viet, Indonesia-based ride-hailing startup Go-Jek is gearing up for a Singapore entry as early as this month, going head to head with Grab in its home base.
Go-Jek has partnered six car rental firms to supply vehicles and sign on private-hire drivers, according to an article by The Straits Times. This is part of the US$2 billion that Go-Jek has been reported to be raising for its regional expansion. Current backers include Tencent Holdings, Temasek Holdings and Google.
The ride-hailing firm is poised to compete with Singapore-based rival Grab, whose March acquisition of Uber’s South-east Asia operations gave it market monopoly in South-east Asia, outside Indonesia and Vietnam.
This Grab-Uber merger has beset both companies with a combined $9.5-million fine recently issued by the Competition and Consumer Commission of Singapore (CCCS), due to infringement on section 54 of the Competition Act.
Go-Jek is set to be Grab’s next rival, and competition will be stiff. Six-year-old Grab has garnered more than US$6 billion in total funding, backed by names such as Microsoft Corp, Softbank Group Corp and China’s Chuxing Didi.
Grab is currently the market leader in Singapore with an 80 per cent market share. However, Go-Jek’s arrival is highly anticipated to revive competition and exert a downward pressure on market prices, as Grab had also been criticised by CCCS for raising its prices by 10 to 15 per cent after the Uber merger.
According to a report by DealStreetAsia, Go-Jek co-founder Kevin Aluwi explained: “We have a greater sense of confidence in terms of how to build a full on-demand ecosystem. International expansion is not easy, both from being ready as an organisation and as a management team and also from a product and technology standpoint.
“These are things that historically we simply didn’t have the capacity to do back then but now we’re very confident that we have all the right ingredients.”