Mobility providers optimistic post-MCO

By Xavier Kong

MALAYSIANS were told to stay at home to break the chain of transmission of Covid-19 under the Movement Control Order (MCO), which started on March 18 and ended on May 3. Now, as Malaysia moves into the Conditional MCO, how are mobility providers coping?

During the MCO itself, mobility providers were hard hit from the stay at home order, with Socar Malaysia CEO Leon Foong sharing that there has been less usage of its service.

Sean Goh, country head of Grab Malaysia, also stated that Grab Malaysia saw a decrease of “more than 90% in its core ride-hailing business since the MCO started.

“Grabfood is still quite a nascent business, yet to break even. So when we saw volume go up we actually saw wider losses,” Goh said on a BFM broadcast, adding that Grab was not too concerned, seeing this as short-term turbulence.

“We know that ride-hailing will start to pick up slowly after the MCO,” said Goh.

Foong concurred, adding that he remained optimistic that business will bounce back in due time, adding that he believes the flexibility and agility of the car-sharing industry in general, and Socar in particular, will stand the industry in good stead in the months to come.

Adapting to conditions

Both providers shared that they have had to introduce initiatives and offerings in time with the MCO in order to keep up with the adverse conditions of the MCO, when mobility demand was at a low.

Grab, for example, turned towards incorporating its ride-hailing partners into Grabfood and Grabmart, so that its partners could still gather income during a time when ride-hailing saw a 90% decrease in demand.

“In Malaysia, we saw, upon entering the MCO, a spike in food delivery orders, while our ride-hailing business was completely gone. So, one of the first things we thought of doing was to deploy our cars towards food delivery, so that they can get extra income, and so that we can continue to be reliable,” said Goh.

In adapting, Socar deployed an initiative called Socar Business Mobility to provide transport and delivery solutions for the operational needs of businesses.

Foong said the idea behind it came about when they saw the change in consumption patterns due to the MCO, such as people buying their groceries or meals via online groups and group buys, and the accompanying change in business operations, such as a growth in home businesses offering essential products and small businesses needing to expand their delivery capacity.

“Hence, we are offering our service to support these small businesses. We can also deliver our cars right to the user’s doorstep which reduces downtime for logistics partners. For those who prefer having their cars topped up by our team pre-delivery, we can also work out special petrol top-up options for these B2B customers,” said Foong.

The resilience of the gig economy

Goh and Foong agreed that the gig economy will remain resilient as well through all of this, and will be a means for Malaysians to recover after the pandemic.

“We strongly believe that the sharing economy offers great promise for those looking for flexible means of income, as well as to defray ownership costs for assets like cars, especially now, with more than one million Malaysians expected to lose their jobs post Covid-19,” said Foong.

He added that the sharing economy in Malaysia is forecast to contribute up to US$14 bil to the national gross domestic product (GDP) by 2025, should there not be any long-term structural impacts from the Covid-19 fallout.

Goh, on the other hand, believed ride-hailing will “always be a safety net for people who need income,” stating that the best thing is that this is not a safety net for after they lose their jobs.

“Most of our drivers have other jobs, other sources of income. This is essentially a platform for people to supplement their income,” he added. — May 12, 2020

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