Bonus key as ride-hailing firms balance customer, driver, company benefits

By Vien Thong   July 20, 2019 | 10:01 pm PT
Bonus key as ride-hailing firms balance customer, driver, company benefits
A Go-Viet driver is seen in Ho Chi Minh City, Vietnam. Photo by Shutterstock/StreetVJ.
Bonus has become a pressure point in Vietnam’s competitive ride-hailing market as firms try to retain customers and drivers. 

Local player Be rewards drivers for both the number of trips and revenue earned. A driver completing between 8 and 38 trips per day will earn bonuses of VND40,000-360,000 ($1.7-15.5). If they earn VND400,000 a day, they get a 25 percent bonus.

Grab, with deep pockets, is giving out the most attractive bonus of up to VND360,000 a day if drivers earn 950 points. Drivers earn 15-35 points for each trip. The company also gives out weekly rewards and other bonuses for partners with high number of trips and revenue, and GrabFood drivers earn a VND10,000-15,000 bonus every trip.

"Grab is still in the money burning period and has no intention of stopping. They are burning money on ride-hailing trips, food trips and the e-wallet, maybe because they are backed by Japanese Softbank chairman Masayoshi Son," said Vu Hoang Tam, an expert on mobile app services.

The differences in bonus policies have led to many drivers working for two or even three companies. Nguyen, a Go-Viet driver in HCMC, said: "Eight out of ten of my driver friends are riding for two companies so they can choose to ride for one that gives the best bonuses."

Tam said that bonuses account for half of the drivers’ income, therefore they tend to react when the policy changes.

300 Go-Viet drivers protested in HCMC Thursday after the company changed its bonus policy, saying they were being made to work more for less benefits. 

Earlier, drivers only needed to earn 10 points a day to get bonus, but the new policy required them to earn 40 points, though the points from each ride also doubled.

Prior to Thursday, Go-Viet drivers in Saigon could receive a bonus of VND30,000 when they reached 10 points, but the policy requires 40 points for a bonus of VND40,000.

This meant that despite doubling the points earned for each trip, each point was only worth one-third of their original value. 

"The point for each journey has doubled but the number of points required to receive bonuses has also increased several times. After calculating, the bonus is reduced in general," said a driver at the protest.

Industry insiders say an effective bonus policy has become a challenging task for ride-hailing companies as they balance three needs: low fares for customers, competitive income for drivers, and high profits for the companies.

"Go-Viet tries to keep trip fares low, which customers enjoy but drivers don’t, therefore bonuses are needed to retain drivers," said a senior official in the ride-hailing market who asked to remain unnamed.

"That’s why when the policy changed to make bonuses more difficult to get, the drivers protested," he added.

Vietnam’s ride-hailing market has become more vibrant with new foreign and local players entering it after Uber quit last year. Singapore-based Grab, Indonesian Go-Jek’s affiliate Go-Viet, Vietnamese Be and FastGo are major companies now competing for a bigger share of the market which could reach $2 billion in 2025, according to a report released last year by Google and Singapore investment firm Temasek.

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