Rumours of a merger between ride-hailing rivals Grab and Gojek began on Feb. 25, in response to a report by American news site The Information.

The report claimed that Grab and Gojek were discussing a potential merger.

It also claimed that the parties were still far from reaching an agreement, and that Grab president Ming Maa and Gojek chief executive Andre Soelistyo allegedly attended the latest merger discussion in early Feb..

Gojek denies reports

However, Gojek has denied that this is true.

A Gojek spokesperson said “There are no plans for any sort of merger, and recent media reports regarding discussions of this nature are not accurate."

Grab declines to comment

Grab's slightly-less-unequivocal statement was simply "We decline to comment on market rumours and speculation."

Can the two stop price wars as a "first step"?

According to DealStreetAsia, a "first step" towards the alleged merger, being contemplated by "one of these companies", was to stop an ongoing price war in both ride-hailing as well as food delivery.

If such a step were indeed taken, consumers could expect to see increased prices for such services.

However, such an agreement would violate competition laws, which prohibits agreements on price-fixing between companies so as to safeguard consumers' interests.

Why is a potential merger significant?

While Gojek has denied the reports, a potential merger between Grab and Gojek would lead to a loss of market competition, which would likely have a negative impact on consumers.

The dangers of one party dominating the ride-hailing industry were highlighted after Grab took over Uber’s ride-hailing and food delivery operations across Southeast Asia in 2018.

The move was found to have reduced competition & increased prices for consumers by the Competition and Consumer Commission of Singapore (CCCS), who warned that Grab would be able to raise the commission rates received from drivers, lower the quality of its services and reduce innovation in its product offerings.

This was found to be anti-competitive and the parties were fined a total of S$13 million by the CCCS.

Top image via Grab FB page and techinasia.com