Meanwhile, in Vietnam: Uber vs GrabTaxi vs Vinasun vs Mai Linh vs EasyTaxi

If you’ve never been to Vietnam, you’ve probably never heard of Vinasun or Mai Linh. But for locals, these names are all too familiar. These two green-clad companies dominate Ho Chi Minh City’s taxi industry. And they are not happy about the recent invasion on their market by taxi booking apps.

With GrabTaxi raising $250 million and Uber raising US$1.2 billion, this topic is ever more pressing. Especially since most of that US$1.2 billion is earmarked for Asia.

While Ho Chi Minh City is thousands of miles away from Uber’s hotbed in San Francisco, the encroachment of taxi-hailing apps is nevertheless affecting the city’s taxi industry – some might say for the better, others might say for the worse.

The incumbents of Vietnam in the last decade: Vinasun and Mai Linh

First, let’s look at the two incumbent taxi companies: Vinasun and Mai Linh. Of late, Vinasun is on the rise and Mai Linh is sliding downwards. In May 2014, Vinasun invested in another 1,225 new taxis to meet its strong rise in demand. Mai Linh, by contrast, had to sell US$25 million of its assets to pay off its debts.

Number of taxis of Vinasun and Mai Linh. Source: Zing.vn

In Ho Chi Minh city, Vietnam’s many malls and apartment complexes make deals with Vinasun and Mai Linh to provide a certain number of taxis at each of their entrances. For example, the Vincom mall must, at all times, have five Vinasun taxis at each of its entrances. This is why each gate requires a taxi employee with a green shirt and walkie talkie to coordinate taxi flow. Due to Mai Linh’s financial troubles, it doesn’t fully own many of its branded cars. This caused a domino effect. Due to its decentralized control over its taxis, Mai Linh was not able to fulfill its deals with local buildings. This allowed Vinasun to swoop in and take on the contracts Mai Linh couldn’t fulfill and secure even more marketshare.

It’s worth noting that Vinasun is only dominant in Ho Chi Minh city, where it maintains a laser focus. The taxi association of Ho Chi Minh city reported that Vinasun has 45 percent marketshare, Mai Linh trails at 25 percent, and other taxi companies represent 30 percent. In Hanoi, there are no major dominant players like in Ho Chi Minh city, but Mai Linh does have the largest piece of the pie. But that’s a pie with 20 times more taxi companies, and nowhere near the dominant position Vinasun has in Ho Chi Minh city.

Revenue of Vinasun and Mai Linh Source: Zing.vn

But market share across two cities does not give a full picture of the Vinasun versus Mai Linh battle. Across the country, Mai Linh has nearly 11,500 taxis. Vinasun has at least 5,500 (Other sources report that Vinasun has over 18,000 nationwide, but this number is not confirmed yet). 74 percent of those taxis are in Ho Chi Minh city. Mai Linh is an older company. It’s been in the taxi, tourism, and transportation game longer than Vinasun. It has over 25,000 employees, in contrast to Vinasun’s 14,000. But what is most telling about the two companies is their respective growth trends. Since 2009, Vinasun’s annual average growth in revenue has never fallen below US$20 million. Its profit has been robust. Last year, it made over US$150 million in revenue. Mai Linh, on the other hand, has fluctuated and floundered for the last six years. In other words, Vinasun is the new and focused whipper snapper entering Mai Linh’s incumbent market.