Part-time Job: Should You Drive For Uber Or GrabCar? (Updated)

Part-time Job: Should You Drive For Uber Or GrabCar? (Updated)

“I love to spend some me-time on the road while being stuck in traffic,” said no one ever.

Based on a recent survey by GlobalWebIndex, 55% of the 1,050 Malaysians polled, said they spend more time in traffic congestions compared to last year.

This makes any convenient, safe and affordable public transportation a boon for Malaysians, because no one wants to be behind the wheel, bumper-to-bumper, every single day. So, what better way to earn some cash offering a service that most Malaysians need?

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If you are looking to utilise the service as a passenger, you can also look forward to cutting your fares with the latest Uber and Grab promo codes.

With Uber and Grab launched in Malaysia in recent years, Malaysians can now make use of these platforms to earn some extra cash.

You need not quit your job to work as Uber or GrabCar drivers, however, with limited time on your hand, you will need to figure out which company pays you more for your time.

Which has higher fare rates & commission

Here’s a comparison of the fare rates and commission for UberX and GrabCar Economy:

UberX
GrabCar
Economy
Commission
25%
20%
Base Fare
RM0.95
RM1.00
Per KM Rate
RM0.60
RM1.30*
Per Minute Rate
RM0.25
RM0.00
* All fares are subjected to flexible pricing due to demand and supply within a certain duration or area.

 

Based on the basic fare structure above, without per minute rate, GrabCar will be more profitable when the traffic is smooth (read: non-peak hours). However, that is rarely the case in the Klang Valley, hence UberX may be a better platform to earn more when you are chauffeuring passengers around in slow and heavy traffic.

Another significant difference between the two platforms are, during peak hours Uber practises price surging. This happens when many people are trying to request a ride at the same time and the fares surge for a typical duration of a few minutes.

Uber drivers may be able to earn more if they drive during peak hours, where fare surging is common. However, Uber also charges higher commission at 25%, while GrabCar’s commission is only 20%.

How much can you earn based on the same distance and duration of trip for both UberX and GrabCar Economy?

Here’s the breakdown for a trip between 1 Utama Shopping Centre and KL Sentral. The distance via LDP and SPRINT Highway is 14.3km.

Non-peak hours with smooth traffic – about 21 mins

UberX
GrabCar Economy
Base fare
RM0.95
RM1.00
Per KM rate
14.3km x RM0.60
= RM8.58
14.3km x RM1.30
= RM18.59
Per minute rate
21 mins x RM0.25
= RM5.25
RM0.00
Total earnings before commission
RM0.95 + RM8.58 + RM5.25
= RM14.78
RM1.00 + RM18.59
= RM19.59
Total earnings after commission
RM14.78 – 25%
= RM11.09
RM19.59 – 20%
= = RM15.67
Peak hours with heavy traffic – about 40 mins

UberX
GrabCar Economy
Base fare
RM0.95
RM1.00
Per KM rate
14.3km x RM0.60
= RM8.58
14.3km x RM1.30
= RM18.59
Per minute rate
40 mins x RM0.25
= RM10.00
RM0.00
Total earnings before commission
Without price surge
RM0.95 + RM8.58 + RM10.00
= RM19.53

With price surge (1.5x)
RM19.53 x 1.5
= RM29.30
Without price surge
RM1.00 + RM18.59
= RM19.59
With price surge (1.5x)
RM19.59 x 1.5
= RM29.38
Total earnings after commission
Without price surge
RM19.53 – 25%
= RM14.65

With price surge (1.5x)
RM29.30 – 25%
= RM21.97
RM19.59 – 20%
= RM15.67

Based on the simple calculations above, GrabCar is definitely better if the time you can commit to driving for them is during non-peak hours, and traffic is smooth. However, if you are working regular 9-to-5 job, you will most likely be able to drive in the morning and evening rush hours.

If that is the case, there’s not much difference between Uber and GrabCar.

How about drivers’ incentives?

Drivers for both Uber and GrabCar do not just earn the fares minus commissions. These companies also offer incentives to their drivers, and these incentives are really where the money is.

Note: incentives change from time to time so it is advisable that you keep updated through their blogs, where they’ll post the latest incentives.

Below are the latest at writing time but you will still need to carefully strategise your working hours to earn the most bucks:

Uber Earnings Boost

This new scheme replaces the Tier 1 incentive and according to Uber, it is meant to keep guarantees super simple.

So how this work is the Uber app will show all areas with high demand and if you drive during those busy hours, you’ll earn extra per trip. Also the earnings boost is not subject to the 25% service fee.

In the event when there is both surge and Uber Earnings Boost, Uber will always pay out the higher multiplier out of the two to make sure that you maximise your potential earnings while driving.

Based on the example of a trip between 1 Utama Shopping Centre and KL Sentral, via LDP and SPRINT Highway (14.3km), a rough breakdown would be something like this:

Rider’s fare:RM14.78
Earnings guarantee: RM14.78 x 1.8 (earnings boost) = RM26.60
Total received:RM11.09 (fare of RM14.78 less 25% service fee) + RM15.52 (earnings boost) = RM26.61

Now, let’s have a look at what GrabCar is offering:

The Grab-Pro Programme

To be eligible for incentives, drivers must fulfil these criteria:

UberX
GrabCar Economy
Trip acceptance rate:
None
A minimum of 88%
Driver cancellation rate:
None
Maximum cancellation of 10%
Average driver rating:
None
4.4 stars and above.
Trip completion rate:
None
50% of busy areas.
Applicable locations:
Area with UBER Boost
KLIA, KLIA2 and Klang Valley.

 

UberX
GrabCar Economy
Hours
Mon – Fri
6am – 10am
Mon – Fri
6am – 10am
Total no. of trips per day
1.5 trips x 4 hours
= 6 trips
1.5 trips x 4 hours
= 6 trips
Total earnings from
fare per day
RM14.10* x 6 trips
= RM84.60
RM15* x 6 trips
= RM90
Total incentive per day
Earning boost
RM84.60 x 1.5
= RM126.90

4 hours x RM30
= RM120

Commission deduction
RM84.60 – 25%
= RM63.45

Total incentive
RM42.30 + RM63.45
= RM105.75
Gross incentive:
Mon = RM138
Tue – Fri = RM116
= RM120.40
Net incentive:
RM120.40 = RM96.32
Total earnings from
fare per month
RM105.75 x 20 days
= RM2,115
RM96.32 x 20 days
= RM1,926.40
* Assuming earning per trip at RM18.80 (before deduction of commission).
^ Based on this example, GrabCar driver will only be eligible for Tier 4 incentive for Friday.

The trips calculated for incentive is only based on the weekly unique passenger count.

Yes, there seems to be quite a lot of terms and conditions to contend to for  GrabCar. The new incentive programme by UberX seems to be more lucrative for the driver as the incentive is not deductible for commission.

The drawback to the new Uber Earning Boost is, you don’t get incentive all the time. Drivers will receive and email detailing the Earning Boost hours for the week, while the app only shows the hours for the day. This means less flexibility for the drivers to maximise their earnings, especially if they have a full-time job.

The other factors

iMoney has always advocated value. The same goes to your side-income gig.

If by earning an additional RM50 you get more headaches, it’s simply not worth your trouble. Therefore, instead of just evaluating the money you can potentially earn, you should also consider the other factors that come with driving people around with both Uber and Grab.

Passenger rating

Sometimes we meet bad drivers, while other times we meet terrible passengers. This goes both ways, and Uber recognises this. To protect its drivers, the app allows both passengers and drivers to rate each other.

Plus the new incentive programme from Uber does not have as many requirements as GrabCar.

Grab, on the other hand, only allows passengers to rate the drivers. Uber drivers can view the rating of a passenger before deciding to accept the job.

Destinations

One downside to Uber is, its drivers are unable to view the destination before accepting a job. This makes it hard for drivers to plan their trips and earnings when they are online.

Unlike Uber, Grab gives you the destination of your passenger, so you will be able to gauge the estimated fares, and also avoid destinations that you are uncomfortable going to. This can give you a clearer idea on the driving strategy.

With today’s high cost of living, every ringgit counts. To keep up with a comfortable lifestyle, you may need a source of extra income, and driving for Uber and Grab may be your answer to that.

Other than analysing the earnings schedule and rates, it also pays to balance whether the earnings will cover all your petrol and car maintenance cost at the end of the day.

Fares and incentives for both platforms change periodically, and you may need to reconsider which platform to drive for in order to make the most of your time.

If you’ve been or still an Uber or Grab driver, let us know if this is a worthwhile side-income gig in the comment section below! Or read this article to see if it’s still worth the effort to be a ride-hailing driver with higher cost of fuel and car maintenance.

First published on May 31, 2016.

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