Mai Linh Group has announced that its motorbike taxi service aiming to compete with Grab and Uber, called M.Bike, will launch on November 20.

Mai Linh’s employees test its motorbike service M.Bike in HCM City. The new transport service will official launch on November 30. — Photo nld.com.vn

The move is yet another development in the heated taxi wars between traditional taxi firms and ride-hailing companies such as Grab and Uber.

Prior to M.Bike, other local tech-driven motorbike taxi services such as VivuMoto or Tim Xe have been launched, to limited success.

Explaining the reason for launching M.Bike, VTC News quoted Ho Huy, the group’s chairman, as saying that traditional taxi businesses, including Mai Linh, are facing difficulties by having to compete with high-tech taxi companies.

But that does not mean Mai Linh would “suffer losses”, the group will try to develop stronger, he said.

Huy added that the M.Bike application was built by Vietnamese engineers. “Despite still having to learn and continue to complete, the application has partly proved the breakthrough of Vietnamese technology in the 4.0 era”.

The application is available for both iOS and Android operating systems.

With M.Bike, Mai Linh does not invest in buying motorbikes, the application will connect customers with drivers, who are partners with the company instead of employees.

The company’s motorbike taxi service will have its own brand identity. The company will equip its drivers with costumes and helmets.

Individuals under the age of 50, with driving licenses, may join the network. However, the motorbikes used must not be produced before 2014.

The price of the service is reported at VND11,000 (about 50 US cents) for the first two kilometres and VND3,800 for each subsequent kilometre. For M.Bike Premium, with more luxurious motorbikes, the rates will be VND20,000 for the first two kilometres and then VND7,000 per kilometre.

The price is not much different from that of UberMoto and GrabBike. GrabBike charges customers VND11,000 and VND12,000 for the first 2km in Ha Noi and HCM City, respectively. The charges can change depending on market demand, location and time period during the day. Meanwhile, UberMoto charges passengers at least VND10,000 at the start for each trip and VND3,700 for the next kilometre.

To attract partners, Mai Linh said that its revenue sharing policy will be at 15-85, which means that Mai Linh will receive 15 per cent of revenue from the transportation.

This figure is much lower than the revenue sharing of other companies in the market, which are between 20 and 25 per cent.

Notably, drivers will be free to use the Mai Linh services for the first two months.

The application was also piloted before being officially introduced. "As we’re joining the game late, we are very careful and listen to our customers. The application was used by the group’s staff in the past two months to learn from experience and complete our services,” Huy added.

The service will first be implemented in Ha Noi, Da Nang and HCM City then will be expanded to other locations if successful.

Bui Danh Lien, Chairman of the Ha Noi Transport Association, was quoted by sohuutritue.net.vn, as saying that his association welcomes the move, as more the businesses that enter the market, increasing competition will push down service prices for customers.

On the other hand, the participation of Mai Linh in the "motorbike taxi" game also proved the sensitivity of Vietnamese enterprises, he noted.

However, Lien expressed concerns for M.Bike as GrabBike is taking over the market, with even UberMoto being dominated by GrabBike.

“Technological motorbike taxi services are not new, so to succeed, Mai Linh must have plans to impress the market to change the habits of consumers," he said.

To change the habit of customers, Lien noted that Mai Linh must have better and more professional service, with price and promotion programme, which must be more attractive than those of GrabBike, UberMoto.

Along with that, communication and marketing strategies must also be good so that its new service can be known by consumers, he added. — VNS