After six years of operation in Japan, Uber Technologies Inc. is finally offering its ride sharing services in Tokyo.
The San Francisco-based company partnered with 3 incumbent taxi firms (Hinomaru Limousine Co., Tokyo MK Corp and Ecosystem) to offer its ride sharing service in Tokyo’s central business district, as well as the Akihabara, Asakusa and Shinagawa areas.
Japan has strict rules governing ride sharing resulting in a number of regulatory challenges. However, Uber had managed to build partnerships with other Japanese taxi firms in order to operate in Osaka, Kyoto and Hiroshima, as well as other provincial cities years prior to its Tokyo launch on Friday.
Despite having one of the largest taxi markets in the world, just 5% of taxi rides are booked online or with apps in Japan. This is because the vast majority of locals simply hail taxis in the street for their rides.
The very premise of Uber – where private car owners turn their own vehicles into taxis for public use – is illegal in Japan. Hence, the need to partner with existing taxi firms was evident in order to get around this issue. Currently, the app has approximately 600 car in circulation available for hire through these firms.
Although on the surface, the app works in a very similar way as far as the user is concerned; in reality Uber’s offering in Tokyo is simply another way to connect with the cab companies that its citizens are already familiar with.
The story is somewhat different for Uber’s food delivery arm, Uber Eats, which has been operating successfully in Japan’s capital city since 2016.