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Akkanut Wantanasombut

February 23rd, 2023

Another double standard to come: The legalisation of ride-hailing in Thailand

0 comments | 13 shares

Estimated reading time: 10 minutes

Akkanut Wantanasombut

February 23rd, 2023

Another double standard to come: The legalisation of ride-hailing in Thailand

0 comments | 13 shares

Estimated reading time: 10 minutes

For countries in Southeast Asia like Thailand, Indonesia, and Vietnam, motorcycle taxis were a part of urban mobilization long before the emergence of ride-hailing apps. Legalising ride-hailing platforms in these countries has more issues to address than elsewhere, since it affects tens of thousands of traditional drivers and millions of passengers. A recent development in the legalisation of ride-hailing apps in Thailand seems to create more conflict rather than improve pain points, especially when it is driven by political motivation, writes Akkanut Wantanasombut

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The legalisation of ride-hailing in Thailand since 2019 has collided with and been shaped by the realities of collective organisation within the sector. While taxi co-ops have negotiated and agreed with the legalisation of ride-hailing apps, motor-bike taxis have organised politically and remain at the vanguard for their job protections. At core here are politics of public policy driven by populism political motivation and may play out in important ways in Thailand’s evolving electoral politics in the years ahead.

For decades, several modes of private transportation, such as taxis, motorcycle taxis, and tuk-tuks, emerged informally to fill the gaps in spotty public transportation networks. It was not until 2019 that the legalisation of app-based ride-hailing platforms became a political issue. Following the Thai military’s seizure of power and transition to a partially-competitive electoral regime, the populist pro-monarchy party Bhumjaithai Party (BJT) announced its policy framework, “Reducing government power for the people’s livelihood”. Promising the legalisation of ride-hailing platforms was a major part of their campaign. Not surprisingly, right after the leading politician from BJT, Saksayam Chidchob, became the Minister of Transportation, the legalisation of ride-hailing applications began.

The two most popular modes, especially within urban areas, are taxis and motorcycle taxis. The total number of licensed drivers registered to the Department of Land Transport (DLT) for each mode is 92,382 and 129,815, respectively. Legalising ride-hailing applications will inevitably affect traditional taxi drivers, as it would allow those who are yet to obtain a license with the DLT to compete for customers. Hence, the most challenging job for authorities is to encourage the two groups of traditional taxi drivers to accept this change. Despite being similar in career, taxi and motorcycle taxi drivers have significant differences in their political worldviews.

Figure 1: Drivers outside GRAB HQ. Photo taken by and copyright of the author.

 

Most taxi drivers are members of a Taxi Co-op, as this is the easiest way to access car instalment programs supported by financial institutions. However, these Co-ops are usually run by a businessman rather than by the Co-op members. These groups have registered as transportation Co-ops to benefit from the government’s promotion of cooperatives, but they operate more like business firms. Taxi drivers wish to be Co-op members so that they can access financial services, and their membership relies on the Co-op management’s approval. Agreed in advance, they promise to vote for a particular group of people to become the Co-op management board members if they are accepted as a Co-op member. As this has become a regular practice, Taxi associations are likely to be more like a Chamber of Commerce or a club of “taxi businesspersons” than a driver’s association. While taxi drivers may be active in national politics, they tend to engage individually rather than collectively. Thus, when the authorities called for a public hearing, the taxi Co-ops agreed on the legalisation of ride-hailing only if the lifetime of a car used as a taxi would be extended from nine to twelve years.

Nevertheless, the reactions from motorcycle taxi drivers were entirely different. Motorcycle taxi drivers aggressively reject legalising ride-hailing apps as they argue the authorities are not imposing existing regulations on all applications. From their point of view, the emergence of ride-hailing platforms creates unfair competition, and authorities have failed to apply the same rules to all platforms. According to interviews with the motorcycle taxi driver, the question of “fairness” seems to be the biggest source of disagreement with app companies.

For decades, queuing has been viewed as the fairest system for the use of motorcycle taxis. The driver waiting for passengers the longest is the one who should have the opportunity to drive the passenger. To avoid clashes amongst themselves, they have created a system to demarcate zones in which motorcycle taxi drivers that are not a member of that particular zone are not allowed to pick up a passenger. These norms of fairness were enshrined over time in formal regulations when authorities stepped in to formalise these rules. Thus, from a motorcycle taxi driver’s perspective, it is not just a social norm but is actually endorsed by the law.

While ride-hailing platform companies want to maximise profits by increasing productivity and matching efficiency, their definition of fairness is different. Currently, to match jobs, platform companies in Thailand force drivers to compete in two different ways. The first is that the system matches jobs based on ratings that drivers earn from their previous passengers; the better rating the driver has earned, the better chance to get a job. The second is that the system will match jobs based on how fast drivers accept available jobs. Both of these logics underpinning the algorithms collide with perceptions of fairness amongst most motorcycle taxi drivers and along with existing regulations in the sector. As a result, the advent of the gig economy is seen by pre-existing drivers as creating conflict rather than an opportunity.

Besides the clash on the fairness paradigm, with their long experience in national political engagement, leaders of motorcycle taxi driver groups see this issue as a part of the national political agenda. During the peak of Red Shirt versus Yellow Shirt politics, the motorcycle taxi driver association of Thailand was regarded as part of the ‘Red Shirt movement’. This explains their distrust of the BJT party and the current government. As Chalerm Changthongmadun, president of the Motorcycle Taxi Association of Thailand, said during an interview after the legalisation became a debated issue again: “The process lacks transparency. We all know the political motivation of BJT since it is their campaign. The government should improve the public transport system rather than allow a private company to come in and cover the state’s inefficiency. In the end, the company will benefit, we will lose our jobs, and passengers will have to pay higher rates.”

Figure 2: Motorcycle taxis protest in front of the Ministry of Transport on 18 August 2022. Photo by Rachada Buranasiri and reproduced with permission.

 

The next general election will be in 2023. To keep “doing what has been said,” the Ministry of Transport, headed by the BJT politician, has continued to push forward the legalisation, but only for taxis first. In mid-2021, after extending the lifetime of a car used as a taxi from nine years to twelve years as requested, the Ministry of Transport enacted the Ministerial Regulation on Ride-Hailing Vehicles Via Electronic System B.E. 2564 (2021), published in the Royal Gazette on 23 June 2021. This regulation is only for Taxis and requires all platforms to seek approval from the DLT.

The issue was muddied further when the 15 July 2022 deadline for approval was approaching. As some platforms offer several services, such as taxis, motorcycle taxis, shopping, food delivery, etc., the platform would need to remove the motorcycle taxi service from the app in order to get approval from the DLT, as it is still considered illegal. In some cases, although a platform may have offered motorcycle taxis through their app for several years, recently, more of their revenue may be coming from food delivery services. The platform may then announce that it will cease its motorcycle taxi service until it is legalised.

As a result, thousands of platform drivers, though not legal, felt there should be a better solution. They rallied at the company headquarters and then the Ministry of Transport, complaining that the regulation has caused them to lose their job, claiming that passengers prefer the better services they provide, and urging the legalisation of motorcycle taxi services through these platforms. The Ministry’s reaction was strange: the approval deadline was deferred, and the rallying drivers were asked to sign their names on a petition. The Ministry then began, once again, accelerating the legalisation of motorcycle taxis via apps, justified by the reason that it affects the public at large.

The following days were filled with a series of motorcycle taxi driver rallies at the Ministry of Transport and the House of Representatives. In response, the Ministry quickly drafted a Ministerial Regulation for Motorcycle Ride-Hailing Services within just a few months. In early October 2022, the Bangkok Transportation Board, the regulatory body on transportation at a provincial level, released two additional regulations regarding the registration of drivers and uniforms. This means that once the Cabinet approves the drafted Ministerial Regulation, motorcycle ride-hailing platforms will be allowed to operate without any delay and before the 2023 general election.

From the motorcycle taxi drivers’ perspective, if the draft is enforced, it will lead to increased confrontation between motorcycle taxi drivers and platform drivers. They have addressed several points in the draft regulation as critical issues, including:

1) Platform drivers can pick up passengers anywhere, while motorcycle taxi drivers are still under regulation to only pick up passengers in their zone;

2) For platform drivers, passenger fees are calculated by an app and fluctuate, while motorcycle taxi fees are standardised and controlled;

3) Platform companies do not limit the registration of drivers, while the number of motorcycle taxi drivers is determined by the population within the service area.

“I could not believe the Ministry is creating these unfair regulations to favour the platform companies. This is a double standard. It is like competing in a football match, but our competitor is under different rules. I have talked to some officials that I am close with, and they said this is beyond their power. They admitted that this is unusual, but they cannot say anything,” said Chalerm Changthongmadun.

The ride-hailing legalisation in Thailand is another example that highlights the nature of Thailand’s politics of public policy. The policy is mostly driven by political motivation rather than public interest, resulting in a lack of transparency, accountability, and the rule of law. The ongoing and complex conflict evident that mobilisation and counter-organisation of workers – traditional and platform – is likely to be a feature of the 2023 election campaign. Platform politics is here to stay.

 

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*Banner photo by and copyright of the author.

*The views expressed in the blog are those of the authors alone. They do not reflect the position of the Saw Swee Hock Southeast Asia Centre, nor that of the London School of Economics and Political Science.

About the author

Akkanut Wantanasombut

Akkanut Wantanasombut is a PhD candidate in Thai studies and works as a researcher at the Institute of Asian Studies, Chulalongkorn University, Thailand. Though his MA and PhD works focus mainly on the political economy at the Thailand-Myanmar border, his research interests also lie in the social impacts of digital transformation, especially from the labour perspective. Currently, he is a part of the research project "ASEAN in the Disruptive Era: Digital Economy and the Future of Work," funded by the National Research Council of Thailand.

Posted In: Connectivity | Governance

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