Business

Uber taps Awaji Island for first taxi-hailing service in Japan

Kyodo

Uber Technologies Inc. said Tuesday it will start its first taxi-hailing service in Japan this summer on Awaji Island in Hyogo Prefecture, targeting foreign tourists and residents in a step toward a full-fledged entry into the country’s huge taxi market.

In collaboration with the Hyogo Prefectural Government, the pilot project will run through the end of next March by using local taxi operators who are accepted through a tender. In principle, users will ride the hailed taxi to other points on the island, rather than taking one of the bridges to the mainland, it said.

Uber, which has been in talks with over 20 taxi companies nationwide for business tie-ups, hopes the project will provide insights as it looks to expand ahead of the 2020 Tokyo Olympics and Paralympics, said Brooks Entwistle, Uber’s chief business officer for international operations.

“Even though it may seem quite small … as a place to start, we don’t think about it that way because this is just a beginning of what’s going to be years and decades of continued growth here in Japan as we bring what we think is world-class technology in transportation business here,” Entwistle said.

“We really view this Japan market as one of the biggest strategic priorities for Uber globally as we spend the next couple of years preparing for and ideally going through an initial public offering,” he said.

Under the plan, users will be able to call a taxi through a smartphone app and see an expected price range for the ride and estimated arrival time before getting into the hailed vehicle.

Awaji Island, located about 30 minutes from Kobe and within an hour of Osaka by car, has a population of around 140,000. Local tourism agencies promote its natural environment, cuisine and hot springs.

As Uber’s ride-sharing service involving private vehicles is challenged by domestic regulations, the U.S. company has shifted its focus to collaboration with taxi operators.

Uber currently provides its ride-hailing services to limousines in Tokyo. The service using private vehicles is only allowed in limited locations, such as some rural areas in Hokkaido and Kyoto Prefecture.