Indonesia keeps ride-hailing fares unchanged after fee ceiling

Jakarta (ANTARA) - The government has no plans to issue a regulation encouraging a rise in ride-hailing fares following a policy capping companies’ commission fees at 8 percent, Transportation Minister Dudy Purwagandhi has stated.

Speaking in Jakarta on Tuesday (June 30), he noted that increasing fares is unnecessary because the new policy also requires ride-hailing companies to fully cover drivers’ insurance, a cost that is typically factored into fare calculations.

Purwagandhi added that a fare hike could instead prove counterproductive for both companies and drivers, as it would make services seem more costly and less attractive for consumers.

Bearing that in mind, he said the government had decided to endorse the current fare levels to preserve a balance among drivers, operators, and consumers in the online taxi industry.

The minister further emphasized that ride-hailing companies had never proposed raising fares despite the reduction in maximum commission fees from 20 percent to 8 percent under the new policy.

He went on to say that the government and service providers share the view that affordability is essential to maintaining demand, while noting that the assurance of unchanged fares does not apply to premium services.

“There are executive, pricier services. It is up to the public whether to choose such services or not,” Purwagandhi remarked.

However, he stressed that the government cannot guarantee fare levels over the long term because companies remain entitled to determine the pricing of their services.

Even so, he expressed confidence that service providers would be more inclined to make internal adjustments rather than passing additional costs on in order to remain competitive.

The companies, he continued, are likely to opt for cross-subsidy schemes to keep their basic services affordable.

President Prabowo Subianto announced the fee-capping policy in his May Day speech in Jakarta on May 1, vowing fairer profit-sharing mechanisms for companies and drivers. The 8 percent ceiling took effect from July 1.

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Translator: M. Harianto, Tegar Nurfitra

Editor: Azis Kurmala

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