Ride-Hailing App Pricing Under Intense Scrutiny Amid Rising Fuel Costs
In the face of escalating oil prices and complaints from Transport Network Vehicle Service (TNVS) drivers about low fares, calls for stricter regulation of ride-hailing platforms have intensified. In an exclusive interview with Star FM Cebu, Ronald Gustilo of Digital Pinoys has urged the Land Transportation Franchising and Regulatory Board (LTFRB) to closely examine and scrutinize the pricing mechanisms of these platforms. This move aims to ensure that passenger fares align with the approved fare structure, following reports from drivers experiencing allegedly low fares on some apps despite continuous increases in gasoline prices.
Monitoring and Concerns Over Pricing Mechanisms
According to Gustilo, Digital Pinoys has been actively monitoring ride-hailing apps after receiving reports in recent months about a platform allegedly offering excessively low fares. While he stated there is no issue with lower charges per se, he emphasized that these must still comply with the LTFRB's set tariffs. Deviating below these rates could lead to driver losses and regulatory issues.
"We don't have a problem if the charges are low. But of course, this should be in accordance with LTFRB tariffs because if not, first, it becomes uncompetitive, and second, drivers incur losses, especially now with the sharp rise in diesel and gasoline prices," Gustilo explained.
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Potential Price Wars and Driver Impact
Gustilo further shared that this situation might be driven by a "price war" among platforms competing to attract more passengers. However, this results in unfair earnings for drivers, particularly amid high diesel and gasoline costs. Although the LTFRB has implemented a provisional fare increase to assist drivers, it appears this relief is not fully reflected in the actual fares offered to passengers on some ride-hailing apps.
The group also stressed the importance of maintaining a balance between affordable fares for commuters and fair income for drivers. This balance is crucial to prevent a potential decline in the number of active drivers and disruptions in service quality.
"One reason our group sees for this is that it might be part of their 'price war,' where one platform offers lower fares to gain more passengers. Essentially, they are chasing market shares. The downside, however, is that drivers suffer losses," Gustilo added.
Calls for Stricter Monitoring and Fair Competition
Digital Pinoys has reiterated its call for more rigorous monitoring of the implementation of the fare matrix. The group assures that it will continue to report received complaints to the relevant authorities to ensure fair competition and protection for both drivers and passengers. This ongoing scrutiny highlights the need for regulatory oversight in the rapidly evolving ride-hailing industry, where economic pressures and competitive dynamics can significantly impact stakeholders.
