The new ride-hailing app is expected to be rolled out in Hanoi and Saigon this month.
According to Phuong Trang (FUTA Bus Lines)’s CEO Nguyen Tri Dung, the company has acquired a ride-hailing app named Vivu in hope of competing with Grab after Uber’s retreat from the market, Tuoi Tre reports. Phuong Trang has changed the app’s name to VATO and invested more than US$100 million to transform it into a full-fledged commercial ecosystem.
Similar to many ride-hailing apps, the VATO app currently provided three transportation options including VATO Car, VATO Bike and VATO Ship. According to Tran Thanh Nam, the app creator, VATO sets itself apart from existing competitors with its bargaining feature that allows users and drivers to negotiate trip prices (with a VATO's standard fee added). Although this feature is not present in Uber or Grab, VATO is not the first one to come up with the idea either. Many taxi aggregators in India have already adopted the price-bidding model, namely Meru, RYT, GoCharlie and Vihik Cabs.
It's still unclear how VATO will implement its bargaining feature, but it should not be long until we find out. The VATO app is going to be introduced this month in Hanoi and Saigon.
Nam also claims that VATO's fares are set at VND8,500 per kilometer, similar to that of GrabCar. The app company will take a 20% commission per trip, while Grab gets 25%. Grab and Uber caused controversy earlier this year for raising their commission rate.
Dung said investing in an aggregator app is a strategic move for Phuong Trang, especially when their taxi line is not making a profit.
Aside from Phuong Trang, Go-Jek and Mai Linh are also considering their options after the Grab-Uber deal shook up the market. With a commission rate of 15%, Mai Linh has rolled out their Mai Linh Bike app last year, while Go-Jek is already hiring people for its Vietnam's launch.
CORRECTION: A previous version of this article misstated the amount of investment Phuong Trang made on VATO. It should be US$100 million, not billion.
[Photo via Bao Moi]
