Meituan to be fined over unlicensed ride-hailing drivers

The law enforcement team of Shanghai Transportation Commission have found three unlicensed online hailing cars on Meituan Dianping in the first two days of their operation investigating ride-hailing businesses.

On March 21, Meituan was ordered to connect all data to the city authority's supervisory system as soon as possible. However, while communicating with the traffic authority, a car with non-local plates was busted for operating via the ride-hailing application.

According to regulations, all cars operating with online ride-hailing providers must have Shanghai plates, and the driver must have Shanghai hukou (registered Shanghai residency), as well as passing a test to obtain a license.

The busted car had none of the three certificates. The driver, surnamed Yuan, picked up a passenger on Gubei Road in Changning District via Meituan and took him to Hongqiao International Airport.

Authorities stopped the car with Anhui plates and found it did not match info shown on the app, which listed a Shanghai plate as per regulations. Further investigation suggested that both the driver’s name and phone number were at variance with those shown on the app.

Yuan had his car seized on the spot and was fined 10,000 yuan (US$1,586). His driver’s license was also suspended  by authorities for three months. Officers said if a driver was busted twice, he or she would face a 30,000 yuan fine and six-months' suspension from driving.

Two more similar cases were uncovered on March 21, leading the traffic authority to urge Meituan to undertake a sweeping self-inspection to rule out unlicensed cars. The company will be fined up to 100,000 yuan for allowing such incidents to occur.

Meituan promised to screen out "black sheep" from the app and connect all data to the city authority's system within a week.

But some customers have found cars on Meituan Dianping easier to book than other apps. Hong Ruoyu, who booked a ride to a restaurant on Meituan, said his order was accepted “within seconds.”

“That’s because Meituan is recruiting drivers desperately,” said Xie Yi, an online ride hailing driver who has been using Didi Chuxing for a long time but also registered an account on Meituan. “I had 15 orders in total on Meituan on March 22.”

Xie held the opinion that Meituan is trying to grab the market share from Didi, and somehow neglected to verify drivers, which resulted in non-local plated cars accepting passengers.

In order to lure more online ride-hailing drivers, Meituan claimed it will charge no commission from drivers in Shanghai in the first three months, while Didi usually charge 20 to 25 percent commission.

“But Didi started to give more bonuses to drivers from yesterday (March 22),” Xie said. “I earned 400 extra yuan for 22 orders.”

Another online ride-hailing driver, who identified himself as Su, said he didn’t want the two companies to enter vicious competition. “Learn the lessons from the competition between Uber and Didi,” Su urged. “It did no good for either the drivers or the passengers.”

Ti Gong