By Nam Hyun-woo – The Korea Times
Hyundai Motor Group is making vast investments in ride-sharing and other mobility services across the world, but is hesitating to do so here on its home turf.
Industry officials said Monday not only the automotive giant but also world-leading ride-sharing firms may ignore Korea as a market, because of the country’s taxi drivers’ strong opposition and entangled regulations over the promising business.
According to a source in the ride-sharing industry, Hyundai Motor Group ended negotiations recently over acquiring at least a 10 percent stake in Green Car, one of Korea’s pioneering car-sharing firms.
Green Car’s largest shareholder is Lotte Rental, and it welcomed refiner GS Caltex recently as its second-largest stakeholder with a 10 percent share. The source said Hyundai Motor Group also considered investing in the firm and possibly forming an alliance, but canceled the plan.
This is not the first time Hyundai Motor Group has extended its hands to domestic ride-sharing firms. In 2017, Hyundai Motor bought a 12.2 percent stake worth 5 billion won ($4.46 million) in domestic startup Luxi, but sold the stake quickly the next year to Kakao Mobility, which purchased a 100 percent stake of the company.
The moves are in a stark contrast to the group’s overseas investments. Last year, Hyundai Motor and its affiliate Kia Motors invested a total 310 billion won into ride-hailing firm Grab and leased 200 electric vehicles to the Singapore-based company.
Following the move, Hyundai Motor Group betted on Australia’s peer-to-peer car sharing firm Car Next Door and India’s No. 2 car sharing firm Revv. Hyundai Motor is operating its own car-sharing service in the Netherlands using its Ioniq electric vehicles.
Hyundai Motor Group Executive Vice Chairman Chung Eui-sun has also been sparing no efforts in stressing the importance of the new generation of transportation. “Hyundai Motor Group is striving to provide freedom of movement to everyone by investing in mobility services, such as ride-sharing and ride-hailing,” Chung said in a speech in India last year.
Though Hyundai Motor Group did not elaborate on its reason for not investing into domestic car-sharing services, industry officials cited “domestic taxi drivers’ strong opposition” and negative views over a “conglomerate of such a size extending its hands toward a business for innovative startups.”
Currently, Korea’s taxi drivers are in a fight against multiple ride-sharing firms. Kakao Mobility suspended its pilot ride-sharing service on Jan. 18 due to continued protests from taxi drivers.
Earlier, the company postponed the official launch of the service, slated for Dec. 17, following the death of a cab driver who set himself on fire in protest.
Taxi drivers are also in conflict with SoCar, a domestic car sharing service, filing a complaint with the prosecution against the company’s CEO.
The government and legal authority’s unfavorable stance is another setback for Hyundai Motor to invest into ride-sharing businesses, industry officials said, citing a domestic court’s illegalization of Uber X carpooling service in Korea.
“Taxi drivers are even opposing startup-based car-sharing services, and a stronger opposition is expected for Hyundai Motor’s potential entrance to such a service, given the country’s anti-chaebol sentiment,” an official at a domestic car industry said.