Singapore – The Competition and Consumer Commission of Singapore (CCCS) has released a Statement of Decision (SDP), noting that the acquisition of Trans-cab by ride-hailing giant Grab is likely to result in a substantial lessening of competition in the market for the supply of ride-hail platform services to drivers and passengers in Singapore.
According to the commission, it has found that the proposed acquisition is likely to entrench and strengthen Grab’s already dominant position in the ride-hail platform market to the detriment of drivers and passengers.
It has also noted that that Grab’s plans to acquire Trans-cab, which is one of the largest fleets (taxi or private-hire car) not owned by or in partnership with any ride-hail platform in Singapore, to increase the availability of drivers on its ride-hail platform comes at a time when rival ride-hail platforms are facing driver supply shortages.
“There are also various strategies which may be employed by Grab to induce Trans-cab drivers to increase their usage of Grab’s ride-hail platform. The Proposed Acquisition is thus expected to result in a greater degree of “stickiness” of Trans-cab drivers to Grab’s ride-hail platform and a potential reduction in usage of rival ride-hail platforms. Consequently, rival ride-hail platforms’ access to Trans-cab drivers post-merger is likely to be significantly restricted,” the commission said in a press statement.
CCCS also notes that if competition constraints on Grab from rival ride-hail platforms are weakened, drivers and passengers could face higher prices and fewer choices for ride-hail platform services.
Grab has also recognised that through the proposed acquisition, it will likely be able to significantly save on the incentives that it would have to pay to drivers as compared to if it employed alternative means to increase driver supply.
Nonetheless, CCCS is welcoming both parties to address the competition concerns raised before the commission makes its final decision about the merger.
Grab first announced its interest to acquire Trans-cab via its GrabRentals arm in July 2023, with initial feedback from the public regarding the merger happening a month later. Initial concerns about the merger have already been manifested by the agency since last year, considering it will make Grab becoming the dominant ride-hailing company in Singapore, discouraging competition.
