On 16 October 2018, Kakao Mobility started recruiting carpool crews, the start of its carpool service. In Korea, it was started with the introduction of several applications. Generally, carpool service is for passengers who wish search for vehicles with other passengers who are heading to their destination. They use smartphone apps, select the vehicles, and pay a service fee. These carpool services are cheaper than taking a taxi to go the same distance. The reason is that unlike taxis which have strict regulations on fares, the carpool service of Kakao Mobility has the right to make an autonomous rate. The taxi industry, which operates taxis at a fixed rate and payment system, and whose livelihood is being threatened, asserts that Kakao Mobility is trying to provide the same or similar services illegally.
Article 81 paragraph 1 of the Passenger Automobile Transport Business Act, which is the basis of Kakao Mobility’s carpool service, states that an automobile that is not a business car should not be provided as paid transportation. But as an exception, a passenger car can be provided for transportation for a charge during commuting hours. Based on this regulation, Kakao Mobility was approved by the government. However, since we don't have exact or official commuting hours, the taxi industry is opposed to carpool driving hours because the time range is too wide. So Kakao Mobility has proposed an alternative to this problem by limiting the number of carpools per day. But taxi drivers expect that the taxi industry will face a serious crisis if the number of passengers using carpool services increases.
Despite these claims, however, many people have a positive opinion Kakao Mobility’s carpool service. They are anticipating better service and more advantages than taxis. In addition, the driving attitude of unfriendly taxi drivers, including refusing passengers, seems to have also greatly influenced the reason why carpool service is receiving more attention. In fact, Seoul introduced a “three strikes” system in January 2015 due to the problems with taxi drivers, such as refusing passengers. According to the law on the development of the taxi transport business, if a taxi is caught three times for refusing passengers or for illegal fares, he or she will be punished with a suspended license. Despite these efforts, we can't ignore the fact that the problem has not changed. And, it is clear that people want to improve the quality of transportation services that have been frustrating them for so long.
The conflict between Kakao Mobility and the taxi industry has been ongoing since last year. Finally, on March 7, Kakao Mobility and the taxi industry held a Social Countermeasures Organization at the National Assembly Hall. They sought to understand each other and find a consultation proposal. The consultation proposal from that meeting said that carpools should be allowed only from 7 a.m. to 9 a.m. and then again from 6 p.m. to 8 p.m. According to the original intent of the current law, these could be the allowable commuting hours. But carpool service was limited on Saturdays, Sundays and holidays. The proposal also included measures to reduce the number of private super-aged taxi drivers, which were pointed out to be a public safety issue. However, it was possible because there were many social processes before the agreement was reached. For example, since 2018, anti-carpool protests have been held, including the taxi industry holding a large-scale rally on 20 December 2018 to oppose the implementation of Kakao Mobility’s carpool service. And so far, a total of three fires have occurred between December 2018 and 11 February 2019. Due to this, carpools are becoming more of a social issue.
Carpools have been popular abroad for a long time. Uber, in the United States, is one of the top in the industry. China's Didi Chuxing has 400 million users and ranks second behind Uber. In the case of Uber, however, unlike Kakao Mobility, countries discussed the insurance issues and implemented a registration system for drivers. However, Kakao Mobility’s carpool service is free from the responsibilities such as insurance issues, tax problems, safety issues, and consumer rights issues. In addition, the carpool service that Kakao Mobility is trying to provide isn’t for non-profit purposes, which was the original purpose of the carpool. Instead, they want fares that go beyond well-intentioned rewards. In other words, the taxi industry is arguing that Kakao Mobility is simply trying to run a cheaper taxi business.
Despite the above differences of opinions, Kakao Mobility and the taxi industry have finally reached an agreement. But, there are still many issues to be supplemented and solved. Under the current law, carpools were originally a legal service, but it set a precedent for operating only at a certain time, leading to negative opinions that it could reduce the size of the future market of passenger sharing services in the long run. As such, many car-sharing companies besides Kakao are showing signs of discord over the agreement between Kakao Mobility and the taxi industry. And people are also expressing concerns for what they point out as a problem with taxis, such as not being able to catch a taxi when it’s needed. Therefore, proper operation of the carpool service will be difficult with only the current agreement reached between Kakao Mobility and the taxi industry. It is expected that additional related bills and proposals that include the opinions of various other car-sharing companies as well as citizens will be necessary moving forward.