The Growth of Ridesharing Service in Japan from viewpoint of relation with Institution, Regulation and Technology

Publication Type:

Conference Paper

Source:

Gerpisa colloquium, Paris (2019)

Abstract:

[The purpose of research]
The purpose of this research to elucidate the question to grow the Ridesharing Service in Japan. It is said that ridesharing service, like UBER, would solve various transportation problem in many country, also Japan. We can make use of ridesharing service to solve problem at region where transportation services are not enough. In urban area, Ridesharing service by Global Platform can solve the problem of “Access to Information about Transport”, especially Foreign tourists. Because these Global application has the function of translation, dispatch, route search, settlement in their currency of tourist. However, there are not any rule and regulation about Ridesharing service in Japan. Ridesharing service is virtually prohibited in Japan. So authors pay attention to Institution, Regulation and Technology in Japan, including Taxi and other para-transit regulation. To solve the question in Japan, authors use implication from French and Finnish experience.

[Situation of Ridesharing in Japan]
On March 2019, some of ride-sharing service operates in Japan. Uber, the US-based service operates in Japan since November 2013. The characteristic of Uber is that the all operations through the ride including payment completely done in a smartphone app. Uber operates in Tokyo as a taxi dispatcher, in Osaka city and Awaji Island as a TAXI-Calling means, in Kyotango town, Kyoto as a fare-paying service for Nursing-care, and Nakatonbetsu town, Hokkaido as a volunteer based service. There are not definition or regulation for ridesharing service both market and non-profit service in any Japanese transportation laws and acts. In actual regulation, ridesharing service must be authorized in only narrow area without any other public transport and taxi, otherwise, it is used as a simple taxi application. The background of strict prohibition Ridesharing service is related to regulation of taxis that is intended to protect the taxi industry. Japanese taxis have three big problems. The first problem is harsh competition, despite being protected by regulation. Harsh competition caused by deregulation at 2002. Taxi drivers are under severe working conditions. Taxi drivers' share is roughly 40% of the fare payed by passenger. The second problem is rapid increasing foreign tourists that caused language problem, many Japanese Taxi drivers can’t speak English. In addition, the spread of house-sharing (like Airbnb) diversify the destinations of users. In Kyoto, taxi drivers remembers the location of all hotels and RYOKANs (Japanese traditional style Inns). But they don’t know the location of sharing house. The third problem is reduce and abolish taxi services in depopulated rural area. Traditional style of taxi service has been no longer sustainable in Japanese depopulated rural area. Technology and knowledge of Ridesharing service can solve Japanese taxi problem. Global platform application is good solution for increasing foreign tourist problem, not only for passenger but also drivers because application has function of translation, currency of tourist. There are many hurdle for municipality in depopulated rural area that wants to introduce ridesharing service like Nakatonbetsu Town. For severe working conditions, there is a possibility of improvement by ICT. In summary, Japan needs two important things, the first is a new application with translation, dispatch, route search, safety settlement, and the second is to establish rules of Ridesharing service especially for depopulated rural areas.

[French and Finnish experience]
For Japan, the case of France and Finland is very suggestive. The former is the point of establishment of regulation and rule, the latter is the integrated application. In 2014, France enacted the Taxi and VTC law that legalize Ridesharing service. The person who wants to become VTC (Uber) driver must obtain a VTC license. After introduction VTC license, drivers and users of Uber increased. Passengers can use Uber safety. In Japan, MLIT (Transportation Ministry) regards Uber as WT (White Taxi) that is No-license taxi as a crime. But now there is new problem that WT by Chinese drivers for Chinese tourists increases rapidly. Illegal Ridesharing service threatens Japanese taxis and users. If VTC license is introduced in Japan, many WT drivers must become a legitimate VTC driver. Finnish solution is Whim application by MaaS Global. In Helsinki people can use taxi like an Uber (payment by application, Pre-determined fee, Dispatch in their native language). On the other hands, Finland has ever reformed transport institutions and law. About taxi, the government has relaxed licenses and entry requirements. That means that Taxi becomes like a VTC. In Helsinki, Uber is just one of Taxi operator under the new regulation.

[Implication]
In Japanese depopulated rural areas, people needs the Ridesharing system by residents as a social business. The implication of Nakatonbetsu town case is that Ridesharing services by volunteers are not sustainable. But also traditional Taxi and Bus service is not sustainable in Japanese depopulated rural areas. There are no longer any options for Ridesharing. So Japan must introduce some kind of license. In Japanese metropolitan area, Ridesharing service is not the only solution. From Finnish experience, innovative application like a Whim can solve the problem, especially Information Access for Foreign tourists. Both France and Finland have democracy using ICT. So Japan must have democracy using ICT.

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