Should ride-hailing vehicles install taxi signs?

Affixing taxi signs for ride-hailing vehicles will lower the competitiveness of disruptive businesses

As ride-hailing services become more popular, more attention is being paid to the regulation and identification of these vehicles. Each country has established new regulations to manage ride-sharing companies. However, unlike Vietnam, ride-sharing vehicles in other countries are not treated like conventional taxi services and neither are they required to install taxi signs.

Indonesia is the largest market for ride-sharing services in Southeast Asia. Ride-sharing vehicles are regulated by the Law on Special Rental Transportation Services, in which public transport vehicles are required to be painted to a certain colour and display registration and operation information on the license plates.

Singapore’s ride-hailing vehicles display anti-counterfeit decals on both the front and rear windows. Meanwhile, the neighbouring country of Thailand is in the process of discussing the operating conditions of ride-sharing vehicles.

In New York city, the rise of ride-hailing companies has shaken up the traditional taxi industry. However, ride-sharing vehicles do not need to install taxi signs or be painted yellow. The city only requires ride-sharing vehicles to put three decals of the licensing committee on the front window as well as two on the rear window of the cars. The city’s licensing committee will stick these decals directly on ride-sharing vehicles. The cars also display registration, inspection, and tax stickers on the front glass.

According to the latest draft replacing Decree No.86/2014/ND-CP on business conditions for automobile transportation, ride-sharing vehicles are required to affix taxi signs on top of the vehicles. If the regulation takes effect, Vietnam will be the first country in the world requesting ride-sharing companies to install taxi signs. This regulation has sparked lengthy debate among the public as it will adversely affect thousands of drivers and passengers. Indeed, ride-sharing platforms have brought several benefits like increasing income for driver partners, shortening waiting times, and lowering transport costs for consumers.

Many experts warn that the regulation will not only dampen the benefits of ride-sharing services, but also increase fares for passengers. Indeed, ride-hailing companies like Grab, Uber, and Fastgo have made a big splash in the market with impressive figures over the past few years. Many passengers prefer ride-sharing services due to its transparency, convenience, and saving money compared to conventional taxicabs.

Do Hoa, a strategic expert, said that consumers would no longer be able to enjoy cheap fares when ride-hailing platforms are treated like transport companies and traditional taxi services. If the regulation comes into force, ride-hailing companies will have to increase operation expenses for renting space, management, vehicle maintenance, salary, and welfare funds. Passengers will have to shoulder part of these expenses and will no longer enjoy the benefits of innovation.

A frequent user of ride-hailing services Nguyen Thi H. (District 7, Ho Chi Minh City) said thatit is unnecessary to ask ride-hailing vehicles to install taxi signs as users connect with drivers via online apps. In addition, ride-hailing vehicles with taxi signs will find it difficult to access public places like airports and shopping malls. As a result, passengers will find it more inconvenient to find ride-hailing services at these places.

On the same note, public policy expert Nguyen Quang Dong from the Institute for Policy Studies and Media Development said that it is necessary to find suitable solutions to regulate ride-sharing services amid the rise of the sharing economy. With a suitable approach and co-ordination among ministries and departments, the country does not need to forcefully put Grab, Go-Viet, and Be into the transport sector. The government can regulate the operation of ride-hailing firms without affecting the state's benefits.

He further noted that the wave of technology and innovation will not only replace obsolete and inefficient ways of doing business, but also bring tremendous benefits to users. Therefore, the regulatory bodies need to adapt their management work rather than limit the development of new business models.