Blue Bird Says Taxis Can Still Grow Amid Competition From Uber

(Bloomberg) -- PT Blue Bird Group, Indonesia's largest taxi operator, said conventional modes of public transport such as taxis still have room to grow even with the increasing popularity of new ride-hailing applications.

“People still need to have a safe, reliable and good value kind of public transport," said President Director Noni Purnomo in a Bloomberg Television interview in Jakarta Wednesday. “At the end of the day, we can all collaborate.”

In another iteration of the bruising taxi company-versus-ride-hailing app battles that have taken place in major cities around the world, Blue Bird has been hit hard by the growing popularity of new competitors like Grab, Uber and GoJek. Ride-hailing is a controversial topic and last year central Jakarta was brought to a standstill by thousands of taxi drivers angry over the spread of ride-sharing applications.

According to Purnomo, it's important for the government to step in to regulate the burgeoning ride-hailing industry to keep customers safe and ensure there's a level playing field.

“When another business model comes, really unregulated on safety issues, pricing issues and tax issues, for example, then it is not a level playing field,” she said. “As long as there are clear regulations, then we will adapt and adhere to the regulations.”

The company said in July it expects revenue this year to increase after the Indonesian government stepped in to regulate tariffs for ride-hailing apps. Beyond passenger transportation, Blue Bird is also looking to expand its logistics business, according to Purnomo, and is seeking partners to do expedite that.

“Because of the economic growth in Indonesia and the high logistics costs in Indonesia at this moment - 24 percent of GDP; that's extremely high - the opportunity for logistics is still big,” said Purnomo.

Shares of Blue Bird are up 16 percent this year, compared with a 14 percent increase for the benchmark Jakarta Composite Index.

To contact the reporter on this story: Sterling Wong in Singapore at swong470@bloomberg.net.

To contact the editors responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net, K. Oanh Ha at oha3@bloomberg.net, Lena Lee

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