Uber Hong Kong general manager Estyn Chung (left) and HKTaxi co-founder Kay Lui on the announcement of the deal

Local taxi app HKTaxi has been acquired by Uber in a deal that Uber said was “driving the adoption of e-hailing in the city”.

HKTaxi, founded by Kay Lui and Maff Wong and backed by local venture capital firm Beyond Ventures, was one of the first legal ride-hailing apps in the city, bringing an app service to replace the many phone-based taxi hailing systems operating in Hong Kong at the time.

Backer Lap Man said he was proud of the “homegrown entrepreneurs” for their success.

Uber Hong Kong’s general manager Estyn Chung in the company’s Causeway Bay offices

“HKTaxi has been able to transform the Hong Kong taxi industry by turning the traditional phone call taxi into a taxi booking app, allowing riders to easily find drivers and vice versa, and enabling electronic payment in the Hong Kong taxi industry. All these features and services greatly improve the overall user experience,” he said.

Through HKTaxi, users could pay for their taxi ride by Octopus or e-wallets, for example, as well as entice drivers at busy times with tips.

Uber says the deal will not lead to any immediate changes for drivers or riders using the HKTaxi app or the Uber app – the HKTaxi app was functioning as normal today, apart from a splash screen announcing the deal.

Estyn Chung, general manager of Uber Hong Kong says the deal is a “new phase” of HKTaxi’s growth.

“It is an honour to partner with them in bringing greater innovation and growth to the taxi industry. When people think of Uber they increasingly think of taxis, and this deal only emphasizes the importance we place in the sector, in both Hong Kong and around the world.”

Speaking on RTHK’s radio show Wham Bam Tram! in May this year, Uber’s head of Public Policy and Regulatory Affairs, North Asia, Richard Willder, said the firm had been working hard on breaking a logjam with government on Uber’s regulation in the city.

A taxi in a Wan Chai MTR mural

“The taxi trade as a whole is big and there’s such a fragmented set of interests there,” Willder told the radio show.

“We know from an Uber perspective we’re going to need a way to compromise locally,” he said.

Willder also said that Uber’s that ratings system was an easy way to improve rider and driver behaviour, with questions today arising over whether drivers under HKTaxi would face potential deactivation if their ratings on the Uber app slipped.

Lawmaker Frankie Yick, chairman of the LegCo Transport Panel, was unavailable for comment – but a year ago, he had called out Uber as irresponsible and “negligent” on permits and insurance.

An investigation by Transit Jam found less than 1% of Uber cars hailed had the necessary hire car permits, while Yick had highlighted the case of a fatal Uber crash in April 2018, after which victims were left waiting for compensation.

The deal with HKTaxi might legitimise some of Uber’s fleet, according to industry observers.