Sep 18, 2024

By Henry Chang Jie Shen September 18, 2024 Introduce daily insurance, expand driver support centers to Penang, JB Malaysian ride hailing set to hit projected value of US$570 mil by 2029 "The Malaysian market is one of our key growth areas in Southeast Asia, and we are committed to delivering innovative, community-focused mobility solutions that resonate with local needs," said Natalia Makarenko (pic), Marketing Director APAC of inDrive at a media event in Kuala Lumpur last week. inDrive (short of Independent Drivers), a global mobility and urban services platform with a presence in 46 countries founded in Yakutsk, one of the oldest and coldest cities in Siberia, Russia by Arsen Tomsky in 2013, is strengthening its presence in steamy hot Southeast Asia, particularly in Malaysia. Since entering Malaysia in 2021, inDrive has expanded its footprint from the Klang Valley (Kuala Lumpur and Selangor) to Penang, Johor Bahru, and to East Malaysia in Kuching, Miri, Sibu, Bintulu, and Kota Kinabalu. It is now exploring to have operations in Melaka next year. Explaining its confidence in Malaysia, the company shared data from market data outfit Statista that showed the Malaysian market is set to grow at a CAGR of 3.5% from 2024 to 2029, reaching a projected market value of US$570 million (RM2.48 billion) by 2029. The number of users in the ride-hailing market is expected to grow, reaching 11.47 million by 2029, with user penetration increasing from 28.1% in 2024 to 31.5% by 2029. Its confidence is further bolstered by a 20% increase in rides and 21% increase in active users during the first half of 2024. InDrive said in July that it had hit 10,000 total drivers in Malaysia by end June, and was ambitiously aiming to double this to 20,000 by end 2024. It expects the number of active drivers to increase by 23% by the end of this year. InDrive categorizes active drivers as those who complete at least one ride within the last 30 days. Competing with Grab and Gojek by allowing driver and passenger to negotiate fare Meanwhile the Southeast Asian ride-hailing market is expected to reach US$8.87 billion (RM38.51 billion) in revenue by 2024, growing at a CAGR of 5.39% between 2024-2029. With such strong growth prospects, inDrive is positioning itself to be a key player in the region, presenting a challenge to market leader Grab and Gojek in Indonesia. One of the features of inDrive that it feels allows it to compete with the likes of Grab and Gojek, is allowing passengers and drivers to negotiate fares directly. While both the driver and passenger have the flexibility to negotiate prices either above or below the recommended price set in the app, to ensure fairness there are limits in place for both parties. It is not known what percentage of rides are based on this method. However, Govin Kumaar Panirsheeluam (pic), inDrive’s business development lead in Malaysia, declined to share what the limits are citing confidentiality. Beyond ride-hailing, inDrive offers a range of mobility solutions, including city and intercity transportation, courier, and “inDrive Services”, a platform for users to source for specialists from household assistance to pet services, catering to the diverse needs of the Malaysian market. Malaysia game plan To support growth and enhance its offerings, inDrive is planning several strategic initiatives in Malaysia. One involves getting drivers daily insurance coverage, seeing how many drivers do not drive full time or even daily and find it unnecessary to get monthly or yearly coverage. Govin said, “We are in discussions to have daily e-hailing insurance as a product which will help drivers to obtain their license-to-drive with us, faster.” This supports an existing benefit they have. “We already have existing partnerships in place for car rental and insurance as well, where drivers can access them at a discounted rate.” Govin expects such incentives to fuel an increase in drivers, with the ride hailing market in the Klang Valley suffering from a known shortage of drivers which has increased wait times for customers and resulted in poor driver behaviour especially cancelling bookings. Additionally, it plans to expand driver support centers to key cities like Penang and Johor Bahru, along with exploring the potential launch of an electric vehicle (EV) fleet to promote sustainable and innovative mobility solutions, which will be carried out in all cities where inDrive is operating. These initiatives align with the company’s broader strategy to capitalize on Southeast Asia's growth trajectory and deliver value-driven services to its users. Future plans focus on improving the overall driver experience, including the introduction of enhanced benefits such as insurance coverage, loyalty programs, and training support. Recently, inDrive announced that it will offer 100% of ride earnings to its 8,000 drivers in the Philippines in bid to disrupt its market that has been dominated by Grab. InDrive launched without accreditation in Jan 2023 in Manila before getting the official nod in Dec 2023. When asked if something similar could be in the plans for Indonesia or Malaysia, Natalia declined to answer, reaffirming that “we aim to keep the commission that we apply to the driver side of the marketplace as low as possible and not exceeding 10%.” She also declined to share what portion of US$300 million in funding it raised from General Catalyst last year is for the purpose of expanding into new markets. inVision aims to benefit 1 billion lives by 2030 Alongside these expansion efforts, inDrive remains dedicated to making a positive impact on local communities through its charitable arm, inVision, with the goal to positively impact the lives of over 1 billion people by 2030. Initiatives such as BeginIT, which identifies and educates kids from orphanages, boarding schools and rural schools about the future of technology to spark their interest in IT careers and enable their personal development; Aurora Tech Award, which supports women founders of tech startups; and Underdog Tech Award, an international prize for the best tech startups outside big tech hubs and communities. These initiatives are open to entries worldwide, and inDrive had received submissions and entries from Malaysia. "Our goal is to not only provide a better ride-hailing experience but also to be a meaningful part of the communities we serve through sustainable practices and impactful initiatives,” Natalia said.