Contrary to what PM Najib Tun Razak and SPAD has been promoting, ride sharing (Uber and Grab) drivers should be very cautious when deciding to purchase a new car for the sake of driving for Uber or Grab. The policy of Barisan Nasional to encourage drivers to buy Proton Iriz as announced is the previous budgets could turn out to be bad instead of good for Malaysians.
This is because for various reasons, full time Uber and Grab drivers are earning less these days compared to previous years. This was revealed by the survey conducted by DAP [1].
Purchasing a brand new car for the sake of driving for Uber or Grab will bring upon a financial burden, from the monthly installments, car insurance and maintenance costs. And a purchase of a car will lock in the buyer to work in this industry for at least a few years, as one cannot easily sell a 1 year old car and walk away.
While Uber and Grab’s financial models may have been good to grab the initial market share, both among users and drivers, the financial payouts to drivers in the months and years to come is of no guarantee. Like all work in the gig economy, workers or drivers need to be prepared to quickly adapt as the companies adapt.
For that reason, driving for Uber and Grab part time with one’s existing car may be a low risk career move, but purchasing a car on a 7 or 9 year installment plan solely to driver for Uber or Grab can be risky, as level of incomes one can earn as a driver today, may continue to drop further, as most respondents who have been driving has testified.