Hanoi bans Uber, Grab cars from 'no taxi' roads

Hanoi on Wednesday started putting up traffic signs banning contract cars with under 9 seats from operating along roads off-limits to traditional taxis as part of a one-month pilot program to ease congestion.

The new signs on Giang Vo, Cat Linh, Phu Doan and Truong Chinh streets are being installed next to or under existing "no taxi" signs as the transport ministry moves to legalize ride-hailing apps Uber and Grab.

Many Uber and Grab drivers frequenting these streets were surprised and worried by the new signs. Minh Duc, who has been working as an Uber driver for two years, said the ban might lower drivers' incomes.

"Uber and Grab both have predetermined fares calculated using the journey's shortest route. If this route includes roads that we're banned from, I'll have to take longer routes and lose money," Duc said.

"If a customer chooses a pick-up point on one of these roads, we will be unable to get there so we'll have to cancel the trip. We will lose customers and have our stars and bonus points deducted."

Meanwhile, many drivers expressed confusion at how the authorities are going to differentiate between contract cars and private cars. "If I drive my passengers to a restricted road and claim they're my relatives then will I be fined?" one driver questioned.

Speaking to VnExpress, an official from the Hanoi Department of Transport confirmed the city is putting up signs banning contract cars with under 9 seats on roads already off-limits to traditional taxis.

"We have not finished putting up the signs so the authorities are not issuing fines yet," the official said.

Additionally, the city will implement a labeling system for app-based taxis so traffic police can identify them and issue fines if they enter restricted roads. However, details about this labeling system will be announced at a later date.

Hanoi bans traditional taxis from entering a number of main roads such as Giang Vo, Le Van Luong, Lang Ha and Truong Chinh during peak hours to curb traffic congestion. Meanwhile, sections of Phu Doan, Cau Giay-Xuan Thuy and Giang Vo are always off-limits to taxis.

As this restriction currently does not apply to Uber and Grab cars, taxi associations in Hanoi and Ho Chi Minh City have been asking for it to be extended to app-based taxis as well to ensure fair competition. This prompted Hanoi's transport department to propose putting up new signs banning contract cars with under 9 seats last September.

Hanoi currently has more than 15,000 app-based taxis running on a pilot scheme, including 11,400 Grab cars and 2,400 Uber cars.

Grab and Uber arrived in 2014 and operate both car and motorbike taxi services. The two services have been running on a trial basis since early 2016, but have been caught up in a war with traditional taxi drivers.

Many taxi firms have accused Grab and Uber of “unfair competition” that has hindered their businesses and caused thousands of drivers to quit.