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Non-Profit Carpooling Service Challenges Mobility Norms in Singapore

A new player has entered the Singaporean mobility landscape: Ryde, a non-profit carpooling service that hopes to ease the country’s traffic troubles through a combination of digital innovation, an unorthodox business model and the creation of a new commuter community. [1]

Carpooling isn’t a new invention, but even though it is an effective way utilize and increase the efficiency of the transportation options that are already present, the carpooling phenomenon has had a somewhat lacklustre story. This is especially evident when comparing it to the meteoric rise of ride-hailing during the past decade.

So why has the simple act of sharing both company and the cost of a car ride fallen behind? One possible answer is that ride-hailing has the same competitive edge over carpooling that it did over classic taxi-services; the advent of digital services that act as the social glue necessary for strangers to find each other with little hassle. Ryde is now banking on using the same glue to digitally bring people together who are looking for a ride or someone to share it with.

The other aspect setting Ryde apart from other mobility providers is that they operate under a non-profit business model. What this means is that Ryde takes little to no commission from their users: In Singapore they obtain a 9% commission per ride and in Malaysia they take no commission at all, meaning that users looking for a ride will almost exclusively pay what it costs to share the actual ride that they are on in the form of petrol and eventual road tolls with the driver and other passengers. So far, Ryde has collected 25,000 drivers in four years, with an expectation to reach 50,000 by the end of this year.

 

Personal comments

Ryde is hoping to create a new mobility community in light of the sharing economy, banking on individual willingness to share cars and rides for a cleaner and more connected society instead of personal financial gain. It is an interesting experiment that is a bit outside the norm when it comes to something so physical as transporting someone from one place to another, more in line with the free connectedness we expect from purely digital services.

An ultra-low or non-existent commission may also be a way to compete with already tight margins present in the transportation sector at large and more specifically within the ride-hailing business. As is becoming more and more evident in our increasingly digital economy; the name of the game is to grow and create a big enough platform of users. Once that is achieved, there is bound to be new or alternative ways to generate the income necessary to break even or expand further.

 

Written by Darijan Jelica, RISE Viktoria.

 

Source

1. 2019-10-18. This Singaporean carpooling app is entering Malaysia with a not-for-profit business model. Will it sink or swim?