Taxi boss who defied lobby has no regrets

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Taxi boss who defied lobby has no regrets


Dukwang President Ko Kyoung-wan poses at the company headquarters in Songpa District, southern Seoul. He said it is no longer possible to stop the wave of changes that is transforming the taxi industry. [DUKWANG COMPANY]

Despite the well-known animosity between Korea’s traditional taxi companies and newer ride-hailing and carpooling services, not every member of the old guard is completely resistant to change.

In the midst of the battle between the taxi companies and Tada, one firm has dared to cross no man’s land to join forces with the innovative van-hailing start-up. The 48-year-old company Dukwang owns licenses to run 81 taxis. From Aug. 19, 20 of those licenses operated as Tada Premium cars, which allow passengers to use high-end van-hailing services through mobile reservation.

Dukwang’s decision to switch sides did not go down well in the taxi lobby, with the Seoul Taxi Association reportedly even considering kicking it out of the organization. Ko Kyoung-wan, the company president and a former engineer at a major telecommunications company, is unmoved.

“The entire taxi industry is difficult - I thought our survival would be at stake if we didn’t collaborate with platform operators,” he said.

The JoongAng Ilbo met Ko at Dukwang’s headquarters in Songpa District, southern Seoul, on Aug. 14. Below are edited excerpts of the conversation.

Q. Why did you join Tada Premium?

I spent my whole life as the son of a taxi company owner. A decade ago, the taxi business was lucrative - the company’s office that allocates taxis always had drivers queued up. But after that, the business went into a long downturn.

When the rate of operating taxis fell to 50 percent, it hit me: “We need change.” At that point I’d been working on platform-related business in an IT firm for eight years. My observation was that in the era of the fourth Industrial Revolution, every industry would eventually adopt platforms. Until now, the taxi industry was able to postpone innovation thanks to licenses. But I think we have reached a tipping point where change is unstoppable.

There must have been platforms other than Tada.

The biggest problem in this business is that the quality of service differs so much per driver. In that sense, Tada’s standardized service is a strong weapon. I’ve experienced a lot of services as a consumer and collected data from social media, but in the end, there was no platform where passengers showed a higher level of satisfaction than Tada.

How did you find drivers of Tada Premium?

We carefully chose candidates that are well aware of the concept of platform taxis. There are 40 drivers. Among them, 10 are experienced taxi drivers who agree on the necessity of change. The other 30 are new in the business. What I found interesting was the contrast between regular taxis and Tada. Nowadays, it’s hard to see applicants for regular taxis. On the other hand, applicants rushed in for the first two weeks after we started recruiting for Tada Premium. We received more than 100 resumes.

Why do drivers prefer Tada to regular taxis?

Taxis have to be on a constant look out for passengers, but Tada Premium does this job by providing a platform. It’s less of a burden for drivers. In addition, drivers are given a monthly income so this gives them more stability.

Are there any difficulties in giving out monthly wages?

In the past, giving monthly income to drivers was practically impossible because it was hard to monitor their work. However, if taxis work on platforms, it’s possible. Tada Premium is entirely based on reservations, so the platform can accurately measure the performance of drivers.

There was a strong backlash from the taxi industry.

The taxi association is in the middle of making a final decision. If our company is removed from the list, we will face a lot of difficulties in management. Tada Premium is just one form of taxi. It’s natural that a company wants to offer better service to raise sales.

What kind of future do you see for the taxi industry?

If a service is standardized via platform and the quality of service is enhanced, managing taxis will become even more efficient. The profits produced in that system will improve the working environment of the drivers. This will motivate well-qualified drivers to enter the market and provide even better services to form a virtuous cycle.

What is your future plan?

We are planning to transition more than half of our taxis to Tada Premium vans this year. After that, the rest will be gradually changed as we scrap old taxis one by one. Our goal is to shift every car to Tada Premium vans by 2021.

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