The Vietnam Taxi Market was valued at USD 0.41 billion in 2021, and it is expected to reach USD 0.79 billion in 2027, registering a CAGR of about 10.25% during the Forecasts period (2022 - 2027).
In 2020, the taxi market experienced significant damage due to COVID-19, with lockdowns and restricted moments the demand for taxi. Increase risk associated with crowded places with social distancing measures have had a negative impact on the growth of the market as the preference of the customers has shifted towards personal vehicles.
Over the medium term, passengers’ preferences for utilizing taxi services and ride-sharing services across the country expected to increase and hence this likely to lead the companies to enhance the options and expand their operations to be provided in mobile applications, to retain their respective market shares in a highly competitive market.
Internet penetration, rise in the standards of living, and the emergence of local players are slowly shifting the landscape. Over the Forecasts period, the rising demand and the market scenario are expected to be graphically different and in favor of on-demand transportation services.
The reduced taxi fare and ease of booking through mobile applications are the major factors that drove the modern taxi service to capture a major share of the Vietnamese taxi market. Moreover, vehicle booking through phone calling and hailing on streets continue to exist as a major service among popular taxi firms, like Mai Linh, Vinasun, Vinataxi, TaxiGroup, Hoang Long, etc. Thus, traditional taxi service has a major share of the Vietnamese taxi market.
Among the cities in Vietnam, Hanoi is likely to grow at faster rate owing to the launches of new ride hailing services from companies like Grab, Fast go, Gojek, etc. and such developments anticipated to continue over the Forecasts period
The taxi industry has been one of the longest-running industries, contributing significantly to the world’s economy. However, the rising ride-hailing and taxi sharing demand are replacing the conventional taxi market. Ride-hailing is anticipated to lead the taxi market over the Forecasts period. According to some surveys, a total of 15 million ride-hailing trips happen each day, which is expected to gigantically increase and hit a 100 million mark, by 2030. Correspondingly, the number of car-sharing users has already exceeded 10 million and is expected to reach 36 million over the Forecasts period.
The growing motorbike sales in Vietnam and its penetration into the ride-hailing and taxi industries have enabled motorcycles as the best compatible model of transport (at least for shorter distances), owing to their availability at half the fare of a taxi/ride-hailing car. The entry of app-based motorbike taxi services had predominantly captured the market share of the traditional motorbike taxi, popularly known as “xe om” in the country.
In the Vietnamese motorcycle taxi market, traditional taxi drivers are still present, especially in tourist areas. However, the app-based motorbike services dominate with more than 60% share in the country’s motorbike taxi market. The increasing entry of both local and international companies into the app-based motorbike services, with unique promotional programs in the Vietnamese taxi market, is likely to further propel the demand for the app-based motorcycle ride-hailing market during the Forecasts period.
Online booking is dominating the Vietnam taxi market and witnessing major growth during the Forecasts peirod. The ease of booking through the app has significantly attracted customers to prefer online booking over offline booking, owing to the increasing usage of internet and smartphones by the people across the world.
Additionally, information, like tracking the driver position, pre-estimated ride fare, driver contact, and vehicle details available within an app at a short time, has further increased the customer preference for the online booking option.
Many major operators, like Grab, Uber, Ola, etc., provide ridesharing option (which provide fare-splitting option among co-passengers) in their respective apps in certain regions, capturing the increasing demand for low taxi fare services among the customers.
To sustain the growing trend of ridesharing service, operators have started adopting the same strategy and are trying to incorporate the ridesharing option in their respective taxi app development. For instance, In Vietnam, Mai Linh, one of the major taxi operators in the country, is trying to focus on providing ridesharing services, to overcome the country’s mobility challenges, like traffic congestion and population. The company partnered with Kyyti Group, to enable plans to launch ridesharing service in Vietnam in the future.
Such active engagement of players in the market and their growing focus to widen customer base through online booking medium expected to create positive outlook for the market during the Forecasts period.
The Vietnamese taxi market is fragmented. Industry participants are likely to witness intense competition, owing to aggressive strategies, including acquisitions, pricing, merges, and new product developments. Major players in this market include Mai Linh Group JSC, Vinasun Corp, VinaTaxi, and GrabTaxi Holdings PTE Ltd.
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In 2020, the taxi market experienced significant damage due to COVID-19, with lockdowns and restricted moments the demand for taxi. Increase risk associated with crowded places with social distancing measures have had a negative impact on the growth of the market as the preference of the customers has shifted towards personal vehicles.
Over the medium term, passengers’ preferences for utilizing taxi services and ride-sharing services across the country expected to increase and hence this likely to lead the companies to enhance the options and expand their operations to be provided in mobile applications, to retain their respective market shares in a highly competitive market.
Internet penetration, rise in the standards of living, and the emergence of local players are slowly shifting the landscape. Over the Forecasts period, the rising demand and the market scenario are expected to be graphically different and in favor of on-demand transportation services.
The reduced taxi fare and ease of booking through mobile applications are the major factors that drove the modern taxi service to capture a major share of the Vietnamese taxi market. Moreover, vehicle booking through phone calling and hailing on streets continue to exist as a major service among popular taxi firms, like Mai Linh, Vinasun, Vinataxi, TaxiGroup, Hoang Long, etc. Thus, traditional taxi service has a major share of the Vietnamese taxi market.
Among the cities in Vietnam, Hanoi is likely to grow at faster rate owing to the launches of new ride hailing services from companies like Grab, Fast go, Gojek, etc. and such developments anticipated to continue over the Forecasts period
Key Market Trends
Motorcycle Ride-hailing Services Anticipated to Play Key role in the Market
The taxi industry has been one of the longest-running industries, contributing significantly to the world’s economy. However, the rising ride-hailing and taxi sharing demand are replacing the conventional taxi market. Ride-hailing is anticipated to lead the taxi market over the Forecasts period. According to some surveys, a total of 15 million ride-hailing trips happen each day, which is expected to gigantically increase and hit a 100 million mark, by 2030. Correspondingly, the number of car-sharing users has already exceeded 10 million and is expected to reach 36 million over the Forecasts period.
The growing motorbike sales in Vietnam and its penetration into the ride-hailing and taxi industries have enabled motorcycles as the best compatible model of transport (at least for shorter distances), owing to their availability at half the fare of a taxi/ride-hailing car. The entry of app-based motorbike taxi services had predominantly captured the market share of the traditional motorbike taxi, popularly known as “xe om” in the country.
In the Vietnamese motorcycle taxi market, traditional taxi drivers are still present, especially in tourist areas. However, the app-based motorbike services dominate with more than 60% share in the country’s motorbike taxi market. The increasing entry of both local and international companies into the app-based motorbike services, with unique promotional programs in the Vietnamese taxi market, is likely to further propel the demand for the app-based motorcycle ride-hailing market during the Forecasts period.
Online Booking Likely to Gain Traction During Forecasts Period
Online booking is dominating the Vietnam taxi market and witnessing major growth during the Forecasts peirod. The ease of booking through the app has significantly attracted customers to prefer online booking over offline booking, owing to the increasing usage of internet and smartphones by the people across the world.
Additionally, information, like tracking the driver position, pre-estimated ride fare, driver contact, and vehicle details available within an app at a short time, has further increased the customer preference for the online booking option.
Many major operators, like Grab, Uber, Ola, etc., provide ridesharing option (which provide fare-splitting option among co-passengers) in their respective apps in certain regions, capturing the increasing demand for low taxi fare services among the customers.
To sustain the growing trend of ridesharing service, operators have started adopting the same strategy and are trying to incorporate the ridesharing option in their respective taxi app development. For instance, In Vietnam, Mai Linh, one of the major taxi operators in the country, is trying to focus on providing ridesharing services, to overcome the country’s mobility challenges, like traffic congestion and population. The company partnered with Kyyti Group, to enable plans to launch ridesharing service in Vietnam in the future.
Such active engagement of players in the market and their growing focus to widen customer base through online booking medium expected to create positive outlook for the market during the Forecasts period.
Competitive Landscape
The Vietnamese taxi market is fragmented. Industry participants are likely to witness intense competition, owing to aggressive strategies, including acquisitions, pricing, merges, and new product developments. Major players in this market include Mai Linh Group JSC, Vinasun Corp, VinaTaxi, and GrabTaxi Holdings PTE Ltd.
- In January 2021, Grab and Panasonic announced partnership to use Panasonic’s air purifiers in taxis to enhance customer experience. GrabCar Premium vehicles in five cities across four countries (Kuala Lumpur (Malaysia), Singapore, Ho Chi Minh City and Hanoi (Vietnam), and Jakarta (Indonesia)) have been equipped with nanoe™ X generators.
- In February 2020, Grab introduced an “advance booking” service in Hanoi, where the service allows customers to book a ride at least seven days in advance. The company planned to test the service in Hanoi before rolling it out in other provinces and cities in the near future.
- In June 2020, Vietnamese taxi operator Mai Linh partnered with local e-payment service provider VNPAY to deploy SmartPOS systems across its taxi fleet, making it the first and only transport company in the country to provide the smart payment option to its customers. As part of the first phase of the project, VNPay has installed SmartPOS terminals across the Mai Linh’s taxi network in Hanoi. The next phase would extend deployment in the southern provinces such as Ho Chi Minh.
Additional Benefits:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
This product will be delivered within 2 business days.
Table of Contents
1 INTRODUCTION
4 MARKET DYNAMICS
5 MARKET SEGMENTATION (Market Size by Value - USD billion)
6 COMPETITIVE LANDSCAPE
Companies Mentioned (Partial List)
A selection of companies mentioned in this report includes, but is not limited to:
- Grab Holdings Inc.
- Kyyti Group
- FastGo
- Gojek Tech
- MVL Foundation Pte Ltd.
- Mai Linh Group
- VINATAXI Co. Ltd
- VINASUN TAXI Corp.
Methodology
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