Kakao Mobility, the transportation branch of South Korea’s largest messenger provider Kakao Corp., announced on Thursday that it recently added 16 personal taxis drivers to its registry in Seoul for its new service called Kakao T Venti. Kakao is rapidly scaling up its taxi van service in a bid to compete with the ride-hailing giant Tada.
Kakao T Venti began its beta test last December in Seoul. It currently employs 50 van drivers but intends to hire 20 to 30 more to reach its goal of 100 vans by March. Each van is capable of carrying up to 11 passengers. Fares were set at cheaper rates than competitors during the trial period.
Kakao Mobility already started offering to personal taxi drivers in Seoul since August last year, with cab purchase loans of 7 million won ($5,480) on a first-come, first-serve basis. The subsidiary will initially offer the subsidies to 200 applicants. The mobility company said it is working closely with the Seoul Metropolitan Government to certify its fare meter system.
According to Kakao Mobility, Venti drivers would be working on their own schedule, unlike traditional full-time employees receiving monthly wages. Venti drivers will pay a 10 percent commission to Kakao.
When people use the Kakao T app to hail a ride, the app notifies the user via a pop-up screen, informing them if there is an available unit nearby. The user can accept or ignore the notification if they choose.
Similar to Kakao T Venti, Tada, which currently operates 14,000 vans, run a chauffeur-driven rental service boasting a user base of 1.7 million. However, unlike Kakao, Tada operates without a taxi license sparking complaints from the local taxi industry. Tada exploited a legal loophole that allows private vehicles with 11 to 15 seats to get paid for offering rides.
Late last year, Socar and Tada operator VCNC faced allegations of running an illegal taxi service. The Seoul Central District Court ultimately dropped the charges after a ruling on Wednesday, saying that Tada is a legal car rental service.
Unlike Tada, which has been struggling with clashes with the taxi industry, the National Assembly, and the local government, Kakao’s T Venti service adheres to the conventional taxi license system. Kakao Mobility assures that the new service will pose no threat to the existing traditional taxi services.