Go Jek investing US$500 million to expand in Singapore, Thailand, Vietnam and the Philippines, no plans for Malaysia

Indonesia’s ride-hailing app Go Jek has launched a beta version of its service in Singapore yesterday as part of its massive Southeast Asia expansion. The company will be investing US$500 million to expand in Singapore, Thailand, Vietnam and the Philipines. However, there are no plans to enter the Malaysian market in the forseable future.

Now in a user acquisition mode in Singapore, the service expects to draw “hundreds of thousands” of users during the beta period, according to CNBC.

Go Jek provides similar services to one of its main competitors, Grab. Users are able to book rides, order food, request for deliveries and pay for purchases from within just one app. Go Jek pioneered the use of motorcycles instead or cars for its ride-hailing service. This was born out of necessity where Go Jek started its service, in Jakarta, a city crippled by traffic congestion. Motorcycles allow users to circumvent the traffic problem in the city.

In Singapore, the beta version of the service will allow users to book rides only at the moment and they can only be picked up and dropped off within a number of limited areas. Go Jek says other services will follow sometime in early 2019

Grab still dominant

While Go Jek has raised more than US$2 billion from big names like investors Google, Tencent and Temasek Holdings since 2016, Grab is still a dominant player in the market with over 60% market share in Indonesia as of June this year, according to research firm ABI Research.

Limited choices in Malaysia

In July this year, transport minister Anthony Loke said that there are no plans to introduce Go Jek in Malaysia, in a response to a question raised by Khairy Jamaluddin in Parliament. The minister said that accident rate among bikers in Malaysia is too high.

Currently Grab is still the only option for both riders and drivers in Malaysia since it took over operations in the region from Uber in March this year.

There have been a number of other ride-hailing companies in Malaysia like Mula, Diffride and MyCar but none offer the on-app convenience and user experience that can match Grab. This has created a sense of unease among drivers and users who say that Grab now has too much control over the Malaysian market akin to a monopoly.