Monday, September 27, 2021

Grab-Gojek merger talks prompt fear, anger from Indonesian driver unions

Drivers' incomes have already suffered badly in the pandemic and they fear a merger would result in job losses.

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Indonesian motorbike rider unions say they will begin protests across the country if ride-hailing and food delivery firms Grab and Gojek continue merger talks without them.

They are afraid that any merger deal will result in mass job losses.

“We are concerned that a merger will result in the termination of drivers,” said Igun Wicaksono, who heads Garda Nasional, a union of more than 100,000 Grab and Gojek drivers.

“If we are ignored, then our last resort will be to conduct mass demonstrations across Indonesia.”

He is calling for government and driver involvement in the negotiations, reports Reuters.

Southeast Asia’s two most valuable ride-hailing, digital payments, and food delivery services are in advanced talks to merge, with the major sticking point being over what a combined operation would look like in Indonesia, their largest market.

Neither company makes a profit and many investors, notably major Grab backer SoftBank Group are keen for a merger that would pave the way for a public listing.

Jakarta-based Gojek is backed by investors including Alphabet’s Google and is valued at around US$10 billion. Grab is valued at US$15 billion.

Ride-hailing drivers in Indonesia say they are worried about what a deal will mean for their livelihoods, after their incomes were slashed earlier this year as Covid-19 badly kicked Southeast Asia’s largest economy.

Garda Nasional said its drivers have recovered about 70% of their pre-pandemic income, but thousands were evicted from their homes earlier in the year.

“A merger is detrimental and we will protest against Grab, Gojek, as well as against Japan’s Softbank if there’s no dialogue with us and regulators or authorities,” said Fadel Balher, a driver union representative in East Kalimantan. “And we will protest loudly.”

Reuters approached both companies but they declined to comment.

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