JakartaPost-Sept 5
Homegrown tech giant GoTo is set to close its operations in Vietnam on Sept. 16, according to a company announcement on Wednesday, as it seeks to close the gap to achieve profitability. The company explained that Vietnam is a highly fragmented market, with multiple players in transport and food delivery. These include regional players Grab, as well as Xanh SM, which is backed by the chairman of local conglomerate Vingroup. The decision to exit the Vietnamese market will allow GoTo to focus on operations that can deliver “a significant market impact” in “a sustainable manner”. It is also aligned with the company’s commitment to breaking even on adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) this year. According to the company’s financial report, international operations contributed 9.1 percent of its net revenues in 2020, despite the pandemic. However, the figure dropped significantly to just 2.7 percent last year. After its exit from Vietnam and having left the Thai market in 2021, GoTo will only operate on-demand services in Singapore and its home base of Indonesia. Ambitious expansion GoTo began expanding its business to neighboring countries in Southeast Asia in 2018, aiming to take advantage of global ride-hailing company Uber’s exit from the region as it refocused on other markets. It executed the plan by entering Thailand, Vietnam and Singapore later that year. However, after just three years in business, the company announced its exit from the Thai market after selling its operations to Malaysian budget carrier Air Asia Group, which was in the process of expanding its lifestyle super app. In Indonesia, two-wheelers accounted for 77 percent of the country’s traffic accidents, according to National Transportation Safety Committee data from last year, but the government refrained from banning motorcycle ride-hailing services. Read more at: https://www.thejakartapost.com/business/2024/09/05/goto-exits-vietnam-amid-push-to-pursue-profitability.html.
