Car-hailing firm Uber is putting the brakes on its taxi and van services in Hong Kong, effective from Monday, citing the need to shift focus to the ride-sharing business and phase out underused services.
The decision comes hot on the heels of Uber's plan to pull out of the Macau market on September 9 due to an increasing crackdown on the operator by the enclave's government.
But Hong Kong's taxi trade yesterday noted that instead of pulling out of the city, Uber was expanding its ride-sharing services, which posed a bigger threat to their business.
A spokesman for Uber in Hong Kong said local taxi and van services – both deemed as "non-core business" for the popular ride-hailing firm – would be available only until Sunday. However, the company will continue providing its other ride-sharing platforms.
"We are realigning our offerings to focus on the ride-sharing options on our platforms UberX and UberBlack, which are used by the vast majority of riders and drivers, and part of the realignment is that some options that are not as commonly used will be phased out," the spokesman said.
"Ride-sharing services are Uber's core business and represent the overwhelming majority of rides in Hong Kong."
He expressed hope that the realignment would allow Uber to improve services for its "rapidly growing" rider and driver base.
In a text message to Uber drivers, the firm informed them of the decision and invited them to sign up for UberX and UberBlack. The former offers smaller car models at more affordable rates compared with the existing UberBlack line and its luxury cars.
Earlier, the firm ramped up its push for new drivers and passengers with an advertising blitz.
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Chau Kwok-keung, spokesman of the Anti-Taxi Franchises Concern Group, said Uber's move meant the firm was going to be more aggressive with the expansion of UberX and UberBlack. "For us it is bad news as Uber looks set to be aggressive in stealing our prime customers," he said.
The government has been accused of foot dragging and ambiguity over the legality of Uber in the city. It has repeatedly said that it is illegal to carry paying passengers without a car-hire permit.
In August last year, seven Uber drivers were arrested for lacking permits and driving without third-party insurance, while police raided the company's offices after complaints by local taxi drivers. Two of them were fined.
Earlier Uber ended its attempted conquest of the mainland's taxi-hailing market after agreeing to sell up to its bigger rival, Didi Chuxing. The deal was for Uber to hand over its Chinese brand, operations and data in exchange for a 17.3 per cent stake in Didi and a US$1 billion investment.