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THE CUT-THROAT ECONOMICS OF ON-DEMAND RIDE-HAILING CORPORATIONS

“Fusion: There’s only one fix for Uber.” –  Why drivers lose at the end of it all?

How On-Demand Ride-Hailing Services Kills the Sustainability of the Balinese Tourism Industry?

An ordinary day in Mr. Ketut’s life would involve picking up tourists at the airport, driving them around and exchanging life experiences while he brings them to explore the island that he has always known to be home. In reality, Mr. Ketut is not an unfamiliar figure. He is one of many freelance drivers who have devoted their entire lives onto tourism. In Bali, a freelance driver’s job-scope does not only comprise transporting guests from one place to another. They are also guides, itinerary planners and most notably friends who the travelers often remain in touch with for a lifetime. Sadly, the sustainability of the freelance driving business is currently in danger.

Today, the rise of on-demand, ride-hailing corporations has heavily impacted the freelance driving business in Bali. At first glance, ride-hailing corporations might bring blessings for the local population. After all, cheaper transport services and a wider advertising platform will rope in more tourists and higher demands for drivers, respectively. However, the reality has been the opposite. These corporations offer cheaper alternatives that diminish the attractiveness of the private drivers’ services. As such, many were pushed against their will and had to join these ride-hailing corporations to remain competitive.

Nevertheless, joining these corporations does not entail good business. More often than not, these corporations employ revenue-centric business models. They undercut market prices below normal profit to increase demand. On top of the low prices, the corporations also takes significant percentages away from the drivers’ revenue. As such, the drivers earn such meagre income that require them to drive at least 16 (sixteen) hours per day in order to earn an income equivalent to private driving. Alternatively, they had to sought other part-time labor jobs, such as construction, to make ends meet.

As frequent travelers, this is an issue that we are strongly against of. We believe that tourism, in any form, should benefit the local population. Instead, in Bali we are witnessing large corporations crumbling the local population to the ground. Many of these drivers have families, for whom they have invested their life savings in order to buy a car that promises an income and a better future. However, it is unideal to be working for 16 (sixteen) hours per day just to earn minimal living in one of the costliest places to live in Indonesia.

We soon realised that this issue is not isolated to the tourism industry alone. In February, a video that surfaced online shows an argument between an on-demand ride-hailing driver and the owner of the corporation. The argument depicts the struggles of the driver to earn a decent living as the corporation continues to undercut prices. The widespread cut-throat cycle that these drivers are stuck in has been experienced in America, Australia and even led to the banning of such corporations in Nicaragua. As much ease as these services have brought to other citizens, it has robbed off so much more from its providers.

As such, RouteX is born. Driven with our mission to fight these oppressive corporations in the tourism industry, we strive ourselves as the voices for these voiceless drivers. We believe that in creating a platform where these drivers are able to cater their services to a larger market, we are able to provide them with more opportunities to drive privately. This gives them more time to rest, to see their families and also, to lay them off the low-income jobs that they have been forced into taking. All of the proceeds go directly to the drivers and to further raise the awareness of our social cause to the larger crowd.

So we urge you to choose RouteX and to support these local freelance private drivers. When we travel, we often choose the cheapest options without thinking the entailing negative circumstances that it bring to the local population. It is therefore, our responsibility, to be a part of this change. So, do your part!

Travel with RouteX; Travel with a Cause.