Online Transportation Price War: Indonesian Style

Abstract

The advent of e-hailing applications in Indonesia has revolutionized the Indonesian transportation industry
in an unprecedented manner. Thanks to the brilliant innovation of the expanding online transportation companies, the
Indonesian people are able to obtain an affordable means of transportation. In the beginning, there are three major
ride-sharing companies who compete to grasp the Indonesian lucrative transportation market namely Go-Jek, Grab,
and Uber. These companies are competing to gain market share by implementing the same strategy which is offering
the lowest price. The situation led to an unprecedented price war which never existed before in Indonesia
transportation history. However, to date, there is no comprehensive report or detailed information about the price war
which essential to understand the magnitude of the war. This paper would provide the comparison of historical fares
data which obtained from multiple sources to understand the magnitude of the price war and to explain why Uber, the
winner of price war eventually closed down their operation in Indonesia.