SEOUL, Oct. 6 (Korea Bizwire) — The rental van-hailing service Tada said Sunday that its service will be available across all metropolitan areas by the end of this year.
The Tada service, launched in October last year and operated by car-sharing app SoCar’s subsidiary Value Creators & Company (VCNC), will expand services — which now cover Seoul; Gwacheon, just south of Seoul; and some parts of Incheon, 40 kilometers west of the capital city — to all other metropolitan areas by the end of December, VCNC said in a statement.
“We are considering launching the Tada services in major cities (such as Busan, Daegu and Daejeon) and strengthening our customer services depending on market demands,” VCNC Chief Executive Park Jae-uk said in the statement.
Tada offers ride-hailing services for 11-seat vans rented from its parent SoCar instead of sedans. Local transport laws allow rental cars with a capacity of 11-15 seats to be legally leased with a driver.
Tada’s app links customers to vans driven by one of the service’s pool of drivers.
Tada has rapidly expanded its presence in the Seoul metropolitan area, boasting over 1.2 million users and 1,400 registered vehicles as of the end of September. Nine out of 10 Tada users called the service again after their initial journey.
The expanded service comes as there is still wrangling with the local taxi industry over the legality of the service. Taxi drivers claim that the Tada service is abusing a legal loophole and killing their jobs.
In July, the transportation ministry came up with a plan to help settle the conflict between taxis and new platform companies and seek mutual growth.
In the ministry’s proposal, car-hailing services like the rental van-hailing service Tada should chip in a certain portion of their earnings to a state-managed fund to be established for the purchase of taxi driver licenses amid oversupply.
VCNC and the taxi industry refused to accept the government’s proposals. But the ministry said it will push forward with them despite disagreement from the taxi industry and new platform operators.
In Korea, taxi drivers have long been criticized for reckless driving, rudeness and selectively picking up passengers depending on their destination. So there has been rising demand for differentiated but not expensive ride services.
Although Tada (the Korean word for “ride”) set its prices higher than those of conventional taxis when it started last year, its fares are currently not very different from those of normal taxis in Seoul, which rose 19 percent to a starting rate of 3,800 won (US$3.30) in February.