In a move highly anticipated by Vietnamese consumers, Indonesian ride-hailing firm Go Jek officially launched its services in Vietnam on August 1st, announcing to the world that it was taking on Grab in Vietnam and other Southeast Asian countries in the near future.
Vietnam is Go-Jek’s first international market outside of its home of Indonesia and the company is branding itself as “Go-Viet” with its mobile app being available for both Apple and Android phones. Go-Viet is initially launching its services in Ho Chi Minh City and it will offer both motorbike and delivery in the city’s 12 districts. There is no time-table yet for when Go-Viet’s services will be expanded to other areas of Ho Chi Minh City or Hanoi and the company has said that its growth with happen “naturally” and with consumer support.
Vietnam is the first step in Go-Jek’s $500-million Southeast Asia expansion plan that includes starting operations in Thailand in September and the Philippines in the 4th quarter of the year. The company has a different strategy from competitor ride-hailing service Grab, that includes tailoring its services to each country with a different name and employing local teams, that it believes have a deeper understanding of local needs.
Go-Jek was founded in Indonesia in 2010 and has raised over $1.5 billion in investment from China’s Tencent Holdings and Google as well as other companies. Go-Jek started out as a mobile phone-based motorbike ride-hailing application and has evolved so that it is now a digital platform that offers delivery, logistics and transportation services.
Consumers who use ride-hailing services are overwhelmingly in favor of Go-Jek and other companies starting operations in Vietnam so that market-leader Grab will have viable competition. Many Vietnamese have said that they believe Grab is an arrogant company that refuses to be a good corporate citizen and pay taxes that were owed by Uber, and that its dominance in the market creates an environment that is not consumer friendly.
The ride-sharing business in Vietnam will grow increasingly competitive this year as Singapore-based blockchain-powered ride-hailing app MVL begins its operations in the country and local taxi companies Mai Linh and Vinasun compete with their own apps and new loyalty programs that are said to launch in the fall. No matter what, it seems that the dominance of Grab in the market over the last 5 months is ending and that the new services are exactly what Vietnamese consumers have been waiting for.