The chaotic roads of Phnom Penh are gearing up to become the next battleground for the region’s leading ride-hailing apps
After months of testing, the US-based ride-hailing app Uber officially launched in Cambodia on Wednesday, a development that the US Ambassador William Heidt described as “an achievement that Uber and Cambodia can rightfully be very proud of”.
“Cities across Asia, including Phnom Penh, are adding tens of thousands of cars to their roads every year. The pressure on their infrastructure and the environment in many cases has become overwhelming,” Heidt said at the company’s official Cambodia launch, according to the US Embassy in Cambodia website.
“Uber’s technologies are providing solutions to these problems by offering smarter modes of transportation with fewer cars, carrying more people, that complement existing systems…reducing transport inefficiencies that can strangle economic growth.”
The company’s launch comes just days after their rivals Grab met with Cambodia’s minister of public works and transport, Sun Chanthol, to discuss licensing requirements and other issues Grab need to address before entering the market.
Following the meeting, Grab’s Thailand country director, Yee Wee Tang expressed his commitment to working with experts from the Ministry of Public Works and Transport on licensing procedures, and said that the company would strictly adhere to Cambodian law.
According to a press release, Grab, which has been downloaded onto over 60 million devices and facilitates more than three million rides a day, will officially launch in Cambodia “once the endorsement from the Ministry [of Public Works and Transport] has been granted”.
While the Singapore-based app has enjoyed widespread success across Southeast Asia by tailoring its approach to local markets, allowing customers to pay with cash and developing features such as built-in translation on the app’s messenger service, achieving a dominant market share in Cambodia will be no easy feat. Grab will be up against local startups PassApp and Exnet Taxi Cambodia, as well as the global behemoth Uber.
However, Uber continues to run into hot waters in Southeast Asia, which could help Grab to assert its regional hegemony. The controversial US company has operated illegally in Thailand since 2014 and was recently banned for a month in the Philippines for failing to obtain the necessary permits to license its drivers, a suspension that was only lifted after the company paid nearly $10m in penalties.
However, in the eyes of Heidt, the company’s entrance into Cambodia demonstrated that the country had made significant strides in improving its regulatory framework.
“It reflects very well on Cambodia’s very welcoming business climate that the Ministry of Public Works and Transport did not shy away from this challenge and worked hard over the last few months to work out a supportive regulatory framework,” he said at Uber’s launch.
“I often hear people worry that Cambodia won’t be able to compete with its larger neighbours in various sectors, be it manufacturing, or services, or something else. But the truth is, when it comes to adopting new technologies, Cambodia’s relatively small size can be a big advantage, as larger countries often can’t adapt as quickly.”