Competition is intensifying among smartphone app-based taxi dispatch services. Domestic taxi operators are accelerating their partnership with different business sectors, such as information technology and manufacturing companies, to increase their convenience such as by introducing new apps that utilize artificial intelligence.
In late July, leading U.S. taxi dispatch service provider Uber Technologies Inc. launched a feasibility test to call taxis using its existing app on Awajishima island in Hyogo Prefecture, in cooperation with the Hyogo prefectural government and local taxi operators.
The service features the ability to display what time a taxi will arrive and an estimated fare. The island has seen terminations or reductions in the number and frequency of its bus lines.
"We want to promote the use of taxis as an effective means of transportation," said a prefectural official.
The app also provides information in foreign languages for visitors from overseas.
Uber has launched ride sharing services overseas, in which drivers from the general public are paid to give rides to users. This presents a threat to taxi operators.
In Japan, this type of "private taxi" service is illegal in principle, so the company is instead focusing on taxi dispatch services in partnership with taxi operators. Negotiations are also under way for a partnership with Daiichi Koutsu Sangyo Co., one of the major firms in the industry, based in Kitakyushu.
Tokyo-based Nihon Kotsu Co. launched a taxi dispatch app service in 2011. One of its aims is to promote usage among younger people. With the increase in the number of app users due to the spread of smartphones, recently even companies outside the taxi industry are becoming increasingly interested in taxi dispatch services.
This year, Toyota Motor Corp. made an investment in Nihon Kotsu's group company. The two companies, together with KDDI Corp., forecast demand and supply using AI based on data, including smartphone location and weather information, and provides the information to taxi drivers.
Drivers can see which routes are more likely to find passengers and increase their income. The service is also said to have reduced the time that passengers need to wait for a taxi.
Sony Corp. has partnered with seven taxi operators in Tokyo, including Kokusai Motorcars Co., to establish a new company to launch an AI-based app this fiscal year.
"We hope to take the AI technology cultivated through projects such as the Aibo household robot dog and apply it to new areas, creating new business opportunities," the company's spokesperson said.
SoftBank Group Corp., which is also investing in Uber and Didi Chuxing, a major Chinese taxi dispatch service company, plans to provide an app on a trial basis in major cities, including Tokyo and Osaka.
The domestic taxi industry has a deep sense of caution about ride sharing being allowed in the future.
A senior official of a major taxi operator said, "Equipping taxis with IT can keep the demand for ride sharing from increasing."
It appears likely that efforts to use apps to draw in customers will continue to increase.
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