Mobile cab-booking service Uber is unlikely to create an upheaval in the Hong Kong taxi market in the short run due to its high pricing, the Hong Kong Economic Journal said Friday.
The taxi app has set its base fare per ride in Hong Kong at HK$35 (US$4.52) plus HK$9.32 per kilometer of drive, similar to the level in the United States, but almost double the existing charges in Hong Kong, the report noted.
The existing base fare in Hong Kong is HK$22 for urban areas, plus another HK$1.6 or HK$1.0 per 200 meters respectively for short-haul and long-haul journeys.
A ride from Central landmark IFC to Shatin New Town Plaza, a popular shopping mall in the Shatin district center costs no more than HK$180 by local taxis. But it would cost HK$350 if one were to use the Uber service.
The Uber taxi app caused ripples in markets in the US and Europe thanks to its upgraded service at a cost similar to local levels.
Yet the luxury transportation company may find it hard to compete with such a strategy with cabs in Hong Kong where taxi fares are relatively cheap compared to other major international cities.
What is worth noting, however, is the rating regime that Uber introduces to the market to grade taxi drivers and lure customers to drivers with higher ratings. This unprecedented mechanism may revamp the market in Hong Kong over the long run, the report said.
Uber is a personal taxi service providing limousines via a mobile app. In Hong Kong, Mercedes-Benz S-Class will be among the vehicles listed for the service deployment.
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