Brian Hioeby Brian Hioe
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Photo Credit: Solomon203/WikiCommons/CC BY-SA 4.0
IN A DEVELOPMENT that caught most by surprise, news broke yesterday that Uber Eats would be acquiring Foodpanda’s Taiwan operations. That is, Uber Eats’ parent company, Uber, would be acquiring Foodpanda from its owner Delivery Hero Southeast Asia.
Consequently, this will mean that there will be one major app-based food delivery service in Taiwan. While other platforms exist, such as GOGOX and Lalamove, their presence in the market is not comparable to that of either Foodpanda or Uber Eats. In particular, Lalamove offers food delivery services but primarily serves as a courier or moving service. Grab, which is otherwise a major presence in the app-based food delivery market in Southeast Asia, does not operate in Taiwan.
It is expected that the deal will close in the first half of 2025 and will involve a transaction of 950 million USD. As such, Foodpanda’s acquisition by Uber Eats will be one of the largest international acquisitions in Taiwanese history that has not taken place in the semiconductor industry.
Facebook post by the National Food Delivery Workers’ Union that it would soon make it a statement, joking about the possible name of the new company
The deal is still subject to regulatory approval from the Fair Trade Commission, which has stated that it may hold public hearings if needed. Indeed, it is possible that there will be strong reactions from the public to the prospect of what may be a de facto monopoly by Uber Eats on the food delivery market.
Reactions from delivery worker unions have been relatively restrained, in the sense that news of the deal seems to have caught all parties by surprise. The National Food Delivery Workers’ Union called for the Fair Trade Commission to investigate the impact on workers’ and consumers’ rights from the deal, as well as the impact of what a monopoly would be. Namely, Uber Eats and Foodpanda were already criticized in the past as unilaterally raising costs for workers and prices for consumers and the former’s acquisition of the latter may make this problem more severe. As such, the National Food Delivery Workers’ Union called for public hearings on the matter.
Some consumer groups, such as the Taiwan Consumers’ Foundation, have also raised misgivings about the possibility of a monopoly resulting from the deal. Otherwise, some reactions from the public speculated jokingly about what the name of the new merger would be.
Two deaths of food delivery workers from collisions in 2019 led to a public outcry, including calls for the formation of a delivery workers’ union across Taiwan. After all, with the rise of the gig economy and food delivery apps, workers were defined as contractors, excluding them from the provisions of the Labor Standards Act, causing them to lack insurance, hazard compensation, or occupational injury benefits. At the time, Taiwan’s major food delivery platforms tried to resist calls that workers be classified as employees instead of contractors.
Food delivery workers face dangers as a result of the pace that they are required to work, such as that at the time of the 2019 accidents, it was required that deliveries be made within fifteen minutes despite the fact that couriers may receive orders every six minutes. This contributes to how workers do not take breaks in order to meet their quotas, leading to accidents caused by exhaustion. This contrasts with how a thirty-minute break is mandated every four hours under the Labor Standards Act.
And despite workers taking such risks, the company sometimes takes much of the pay for deliveries, such as taking up to 30% of the delivery order. Indeed, for food delivery workers, changes in salary calculation formulas are sometimes announced by the company without consultation with workers. In 2021, food delivery workers demonstrated against new salary calculation formulas announced by Uber Eats and Foodpanda that would have cut their salaries by 10% to 30%.
Statement by the National Food Delivery Workers’ Union on the acquisition
While workers could have made between 65 NT to 75 NT on a delivery in 2020, the changes resulted in workers making between 43 NT to 50 NT on the same delivery. As such, workers will need to work more hours while making less pay. According to Chen Yu-an, one of the convenors of the National Delivery Workers’ Union, while he previously made 9,600 NT by delivering 110 orders in a week, after the changes, he made 9,000 NT by 164 orders.
This attempt to cut costs by squeezing more work out of delivery workers impacted their safety. According to the organizers of the National Delivery Workers’ Union at the time, the average rate of accidents in central Taiwan for delivery workers increased from 1.4 times per month to 4 times a month after the new changes in salary calculation were implemented.
It is to be seen whether Uber Eats acquisition of Foodpanda leads to a wave of organization among delivery workers, when there has been less activity in past years compared to the period between 2019 and 2021. If there is a wave of consumer outrage over the possible monopoly, this may be something that union organizers will have to capitalize on in pushing for workers’ rights.