Surge fees cut could affect availability, ride-hailing firm warns 

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Philstar.com

December 12, 2025 | 7:20pm

MANILA, Philippines — A ride-hailing company has warned that the government’s order to slash surge pricing for Transport Network Vehicle Service (TNVS) trips by 50% could affect drivers financially and weaken ride availability.

In a statement Friday, Grab Philippines nevertheless said it respects the move by the Land Transportation Franchising and Regulatory Board (LTFRB) the adjusted surge pricing rules during the holiday rush.

“Grab has always been a partner of the government, and we share its commitment to easing the daily burdens of our kababayan. It is in this spirit that we respect and accept the recent DOTr–LTFRB decision to temporarily reduce surge prices by 50%,” the company said.

But firm said that while the cap may ease immediate costs for commuters, it risks shifting the pressure onto drivers who incur longer travel times, heavier traffic, and higher fuel consumption during the holiday season.

“It is important to emphasize that surge pricing helps ensure driver availability during peak hours, bad weather, and high-demand periods. A significant reduction in surge fees may discourage drivers from going online when they are needed most, ultimately affecting service reliability for commuters,” it added.

This comes as LTFRB has issued Memorandum Circular 2025-056, setting rules on surge charges during the Christmas and New Year season.

The circular directs TNCs to reconfigure their fare algorithms so that surge pricing cannot exceed the combined per-kilometer and per-minute rates set under MC 2019-036. The LTFRB said the move responds to mounting commuter complaints about steep TNVS fares during weather disturbances, peak hours, and high-demand periods throughout the past weeks.

The LTFRB has committed to compensatory adjustments to address possible losses to be incurred by TNVS drivers. These include additional compensation for pickup time and increase in time-based charges to reflect holiday traffic conditions.

Grab acknowledged the greater demand for TNVS, but pointed out that these same conditions necessitate additional compensation for its driver-partners. It said “we hope to ensure that the policy’s implementation does not unintentionally shift the burden from riders to our drivers, who we believe deserve fair compensation for the extra time, effort, and fuel required to navigate holiday congestion and safely serve the riding public.”

The company added that surge pricing plays an essential role in ensuring drivers go online “during peak hours, bad weather, and high-demand periods,” ultimately benefiting commuters through improved ride availability.

“Ultimately, the most sustainable solution to our transportation challenges is the continued development of a strong, efficient, and reliable mass transport system. Grab fully supports the government’s long-term efforts to improve public transportation infrastructure, and we believe TNVS services are most effective when they complement—rather than replace—efficient and affordable mass transit options,” the company said.

Earlier, a TNVS group called the surge price cut “unfair for drivers”.

The group, which calls itself the TNVS Community Philippines, warned that capping price surges could hurt both drivers and operators.

Its spokesperson, Lisza Redulla—who gained popularity as a female Grab driver after leaving her regular job—said that surge pricing reflects the real conditions of transport operations, including traffic, pick-up distances and rising operating costs. — With a report from Jean Mangaluz