Taxify launches in another country to challenge Uber's ride-sharing dominance

Uber's stronghold in Australia is about to face a challenge.

Estonian ride-sharing company Taxify launched in Sydney on Tuesday, with more than 4,000 drivers signed up so far.

"Sydney is a huge and vibrant city, and we are excited to launch in the Australian market. We are confident that locals are looking for an alternative ride hailing option, and Taxify is committed to providing both riders and drivers with what they want," Markus Villig, founder and CEO of Taxify, said in a statement.

"We have based our business model on fairness and transparency, and it is because of this that we have had so many drivers sign up to Taxify in such a short space of time."

To hook in new users, Taxify is trying its hand at an Uber tactic: Discounted fares, at 50 percent for at least a month after its launch in Sydney.

However, Taxify will differentiate itself from Uber by taking a lower commission from drivers (15 percent on Taxify, compared to Uber's 25 to 30 percent).

It will also cap everyday surge pricing at 1.5x, and instead on relying on an algorithm to determine demand and supply for surge, it'll have someone manually adjust pricing. For public holidays and big events, however, the company said customers might "experience slightly higher surge pricing."

Original image has been replaced. Credit: Mashable

Taxify is stepping into a ride-sharing market that's overwhelmingly dominated by Uber, thanks to its success in parrying the efforts of local rival, GoCatch. There were once rumours Lyft would enter the fray in Australia, but to this date it is still very much focused on North American markets.

Now operating in 20 countries, Taxify has an investor in Chinese ride-sharing company Didi Chuxing. Taxify was however kicked out of London after only three days of operation in September, after Transport for London found it didn't have the appropriate license.

It should have no such issues in Sydney. The New South Wales state government made ride-sharing legal in 2015, as have all other jurisdictions in Australia.