Philippine startup is gunning to beat Uber at its own game

Think your commute this morning was bad? Spare a thought for people in Manila who endure the “worst traffic on earth” every day. Waze found out it takes an average of 45.5 minutes to commute from home to office in Manila, longer than the 42.1 minutes travel time in Jakarta.

Manila’s horrendous traffic is blamed on a combination of factors, with the sheer volume of vehicles topping the list. That’s to be expected – if bus and railway systems are overcrowded and deteriorating, people will opt for cars.

Uber and GrabCar make it easy to order cars and they’re comfortable too, persuading many to just order a ride and leave their own vehicles in the garage. Yet there’s a debate about whether these tech-based transport companies actually cut the number of cars plying on the streets since they often take only one passenger at a time. Good thing the solution doesn’t stop with them.

We know one startup in the Philippines that claims it can do more than Uber or GrabCar – U-Hop. “U-Hop because everyone deserves better,” reads its tagline.

Similar to Uber and its ilk, the company allows commuters to book rides through its website and app. It doesn’t own the vehicles, but partners with the owners or operators. However, unlike Uber, U-Hop makes use of shuttles, which can seat seven to 12 passengers per trip.

Shuttles are a popular mode of transport among Filipinos. The problem is, oftentimes, lines at terminals are too long.

On U-Hop, commuters book a ride, are picked up at a common point, and then dropped off where they intend to go. The system chooses the passengers who will ride together in a trip – matching those with the same route and same pick-up time.

“U-Hop will reduce the number of vehicles on the road by promoting a 1:7 ratio of car and passengers, rather than 1:1. It’s also good for the environment because it reduces carbon emissions,” founder Marvin Dela Cruz tells me.

At the moment, U-Hop takes on a B2B model: it deals with large enterprises, such as call centers, which provide shuttle services as a form of benefit to their employees. Say, a company has a dozen employees who need to be fetched, then U-Hop will allocate two shuttles for that firm.

All trips are scheduled in advance, and fares are paid the same way. Prices are fixed at PHP 693 (US$17.5) per passenger a week or PHP 2,970 (US$75) a month. That’s equivalent to PHP 99 (US$2.50) for a roundtrip each day, way cheaper than a roundtrip by taxi or a normal shuttle.

Two-pronged business model

You may think: why compare U-Hop with Uber when one’s an apple and the other is an orange. Hold that thought. U-Hop also offers an on-demand service using cars, though this is not activated yet pending approval of the company’s application for a government license.

Once available, the cars will function the same way as Ubers do: when users book a ride, the car picks them up at their location and takes them to their desired destination.

Marvin says U-Hop will be more affordable than Uber or GrabCar. Fares of the two usually surge during rush hours (the surge could go as high as five times your normal fare for Uber and twice for GrabCar). In Manila, where a lot of families don’t even have enough for food, those add-ons make it almost impossible for them to avail of the services.

Membership-based

Safety is paramount

Moving at a snail’s pace

A ready consumer base