Uber wins approval for taxi-hailing pilot programme in remote Japanese island

Tokyo

AFTER years of being sidelined by Japan's laws against ride-sharing, Uber Technologies Inc won government approval for a taxi-hailing pilot programme in Japan.

Starting this summer, Uber will connect local drivers and passengers in Awaji, a remote island that is home to 120,000 people and a dozen taxi companies, the company said in a statement on Tuesday.

The pilot, which will last till next March, is a minor victory for Uber, which has adhered to local rules since debuting in Japan five years ago. Uber mainly operates as a car-hailing service in Tokyo and has not sought to disrupt the country's 1.72 trillion yen (S$20.7 billion) taxi industry. Prime Minister Shinzo Abe's administration is seeking to use Uber's technology to promote tourism on Awaji. It is a chance for the startup to raise awareness of its services by operating as a taxi dispatcher and possibly expand into bigger markets in the archipelago.

"As we join forces with local taxi companies and the Awaji district administration office, we will work together to enrich the product offerings of what will be the first initiative of its kind in Japan to meet the local needs," Brooks Entwistle, Uber's chief international business officer, said in the statement.

Uber did not disclose financial details or partners. Awaji Island's taxi companies collectively oversee a fleet of a few hundred cabs, according to the San Francisco-based company. The pilot programme is the first initiative following chief executive officer Dara Khosrowshahi's visit to Japan in February, when he outlined a new strategy of forging partnerships with taxi companies.

Nihon Kotsu Co and Sony Corp have also released or are working on rival taxi-hailing apps. BLOOMBERG