The Vietnamese taxi market has witnessed fierce competition in recent times, with some big names having to withdraw. Stocks of many companies have fallen. Who is still standing with billionaire Pham Nhat Vuong in this potential sector?
The race is fierce
In September 2024, Gojek - Indonesia's ride-hailing and food delivery unicorn, suddenly decided to end its business operations in Vietnam to focus on key markets where the platform is dominating.
This is considered a change in the taxi transportation market in general and the ride-hailing platform in Vietnam in particular. Gojek's decision to withdraw from the Vietnamese market means giving up market share to other companies, including Malaysia's Grab.
Gojek is struggling in Vietnam despite becoming the "champion" in Indonesia and gaining market share in Singapore.
Previously, in early 2018, Uber's operations in Southeast Asia were acquired by Grab. All Uber drivers in Vietnam transferred to Grab.
Not only Gojek or Uber, many traditional taxi companies in the country are also facing difficulties. From the number 1 position in the taxi industry in Vietnam, Vietnam Sun Corporation - Vinasun (VNS) has been in a difficult situation for a long time due to fierce competition with technology taxis such as Uber and Grab.
In 2020, the giant in the traditional passenger transport sector suffered its first loss due to the impact of the Covid-19 pandemic and was forced to cut a large number of employees, up to nearly 1,400 people. Vinasun, of former Chairman Dang Phuoc Thanh, lost more than VND 210 billion in 2020 and another VND 277 billion in 2021. From 2022-2023, VNS returned to a profit of VND 150-180 billion but showed signs of slowing down in 2024.
On January 5, Vinasun's long-time foreign shareholder, Tael Two Partners Ltd (a fund management company in Singapore), completed the sale of all 5 million VNS shares it still held, officially parting ways with Vinasun after more than 11 years of capital investment. At the end of 2023, Tael Two Partners still held more than 12.4 million VNS shares, equivalent to 18.3% of charter capital.
Over the past year and a half, VNS shares have been on a downward trend, from nearly VND16,000/share to VND10,350/share (morning of January 8), partly reflecting the difficulties that this business is facing.
Similarly, the taxi giant Mai Linh of Chairman Ho Huy has also encountered numerous difficulties in recent years. The businesses in the group have very low profits, some subsidiaries often owe taxes and are late in paying social insurance. In 2018, Mai Linh North (MLN) and Central (MNC) delisted and merged into Mai Linh Group.
NO1 shares of 911 Group Corporation - a company that plans to establish a new taxi company, developing more than 2,200 cars by the end of 2025 - also recorded 8 price declines in the last 10 sessions, including one floor price. NO1 shares fell from VND12,150/share to VND9,800/share on January 7.
Previously, NO1 shares skyrocketed to the ceiling for many sessions when there was information about buying a large number of VinFast cars to establish the "911" taxi company.
Who's left?
According to Q&Me's report, in 2024, Grab will still be the most used car company by Vietnamese people, but its market share is gradually being taken away by two purely Vietnamese technology car companies, Be and Xanh SM.
In the past two years, billionaire Pham Nhat Vuong's Xanh SM car company has made very strong progress. In the country, Xanh SM's market share is only second to Grab's.
At the end of 2024, Xanh SM officially entered the Indonesian market with about 1,000 VinFast VF e34s in the most populous country in Southeast Asia, and signed a series of memorandums of understanding (MOUs) with major partners such as Vietjet, Huawei, Visa, etc. to support and promote the greening of transportation. Previously, in November 2023, Xanh SM launched services in Laos.
Green SM representative said that Indonesia is the third market but the largest country and not the final stop in Green SM's global journey.
According to Vingroup's (VIC) 2024 semi-annual financial report, Green and Smart Mobility JSC (GSM) contributed more than VND5,700 billion in revenue to Vingroup. Xanh SM was established in early 2023, with an initial scale of 20,000 cars.
Recently, the market has also welcomed new names in the taxi industry, using electric vehicles such as Let's Go Taxi. This is a mini electric taxi company of Let's Go An Binh Joint Stock Company, launched in May 2024, operating in Phu Yen. Let's Go Taxi has signed a contract to buy 600 VinFast VF3 electric vehicles for the 2024-2025 period to operate as a taxi with low fares "like motorbike taxis", about 8,000 VND/km.
Let's Go Taxi representative said that every field has its difficult times, requiring replacement when the old one is no longer suitable. The taxi market is no exception, and is even the clearest proof of the story of change to adapt.
At the end of 2024, Vietnam's oldest taxi company - Mai Linh Taxi signed a cooperation agreement with Xanh SM, purchasing and leasing nearly 4,000 VinFast VF e34 and VF 5 electric vehicles from GSM. The Mai Linh electric vehicle fleet will have the additional logo "Partner of Xanh SM".
Some traditional taxi companies such as Thanh Nga, Bac A, Que Lua, Long Bien… have also made moves to switch to electric vehicles.
It can be seen that the Vietnamese taxi market has changed very quickly in recent years. In particular, the technology-based ride-hailing segment no longer belongs to the foreign giant Grab, but has seen a strong breakthrough by Xanh SM and the appearance of many other names.
BeTaxi and BeCar also grew strongly. This was also the pressure that pushed Gojek's market share down and the company withdrew from the Vietnamese market.
Recent surveys by Q&Me show that customers over 30 years old often choose Grab but Genz choose other domestic applications.
According to a report by Mordor Intelligence, the ride-hailing market alone, including technology taxis, in Vietnam in 2023 will be worth nearly 730 million USD.
Source: https://vietnamnet.vn/ngoai-rut-lui-noi-thoai-trao-ai-du-suc-canh-tranh-voi-ty-phu-pham-nhat-vuong-2361307.html
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