GrabCab, a subsidiary of Grab Rentals, will begin its taxi services in Singapore in July, starting with a fleet of 40 cars.

The company plans to attract new and inactive taxi drivers by offering monetary incentives and a S$1,000 (US$770) bonus for safe driving.

Currently, between 700 and 800 drivers have shown interest in joining GrabCab. Of these, 400 to 500 are being considered for having a Taxi Driver’s Vocational License (TDVL), which is required for taxi drivers in Singapore.

Pre-registered drivers can begin their appointments on June 5, while registration for others will open on June 9.

Victor Sim, head of GrabCab and GrabRentals, explained that the company aims to reactivate inactive TDVL holders instead of recruiting from existing taxi operators.

GrabCab received its license in April, making it Singapore’s sixth taxi operator. The Land Transport Authority (LTA) indicated that GrabCab’s entry is expected to increase taxi supply and provide more options for drivers and commuters.

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🔗 Source: CNA

🧠 Food for thought

1️⃣ Singapore’s declining taxi fleet creates opportunity for new entrants

Singapore has experienced a dramatic decline in traditional taxis, falling from 28,736 vehicles in 2014 to approximately 13,117 in 2024, while private hire vehicles surged from 1,609 to 59,371 during the same period1.

This market transformation explains why GrabCab can confidently enter the market without directly competing for existing drivers, as there’s a significant pool of dormant drivers with valid Taxi Driver’s Vocational Licenses who left the industry during this decline.

The timing of GrabCab’s entry is strategic as recent government interventions, including extending taxi lifespans from eight to ten years and reducing inspection frequency, have been implemented to address the taxi shortage2.

These regulatory changes aim to reduce operational costs for drivers, potentially making taxi driving more financially viable again after years of declining appeal.

2️⃣ Shifting consumer behavior creates hybrid service opportunity

The significant drop in street-hailed taxi trips—from 95,000 daily in December 2022 to 66,000 in December 20241—reveals changing consumer preferences that GrabCab is positioned to address.

By launching as Singapore’s sixth taxi operator while being connected to Grab’s established technology platform, GrabCab creates a hybrid model that bridges traditional street-hail services with digital convenience.

This approach aligns with observed driver behavior, as many taxi drivers already prefer app-based bookings over street hails due to the predictability and flexibility they offer1.

For consumers, particularly seniors and tourists who may be less comfortable with ride-hailing apps, GrabCab’s street-hail services could fill an important gap in the transportation ecosystem while still leveraging technology for operational efficiency2.

3️⃣ Driver recruitment strategies reflect industry-wide challenges

GrabCab’s focus on reactivating dormant drivers rather than poaching from competitors highlights a structural challenge in Singapore’s transportation sector—the cultural reluctance among younger Singaporeans to pursue taxi driving as a career2.

The company’s incentive structure, including monetary rewards for meeting ride quotas and a S$1,000 safety bonus, directly addresses the economic pressures that have pushed drivers away from the industry in recent years3.

These incentives reflect a broader industry trend where operators must offer increasingly attractive packages to overcome both the financial and perception barriers that have contributed to driver shortages.

The significant interest from 700-800 potential drivers suggests that with the right incentives, there remains a viable pool of qualified drivers who could be drawn back into the taxi industry, potentially reversing the decade-long decline in taxi availability3.

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