Taxis: India

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This is a collection of articles archived for the excellence of their content.


Women-driven taxis

Centre tells states: Provide fee relief

The Times of India, Jun 04 2016

Dipak Dash

Provide fee relief to women-driven taxis, Centre tells states

 Centre wants states to “brand“ women-driven taxis exclusively and to exempt them from paying permit fees. This is aimed to encourage more such womendriven taxis, which is gaining currency across the country .

The road transport ministry has suggested this in the proposed taxi permit scheme for both city taxis and All India Tourist Permit (AITP) cabs. The policy will cover taxi aggregators and there will be a cap on fare as earlier reported by TOI.

It suggests while capping of fares will cover vehicles falling under two categories airconditioned micro and mini city taxis air-conditioned midi and mega taxis such as Honda City , Toyota Altis, Dzire and other top end cars that operate with permits to ply within the city will be out of this regime. “The fare of such taxis should be market driven,“ said a ministry official.

Considering that a robust taxi framework can supplement good public transport system in cities, the proposed policy also suggests states to create special taxi parking zones by earmarking at least 20% space for such vehicles free of cost.

The AITP vehicles would be allowed only for hiring on hourly basis (minimum four hours) or daily basis or for long-term basis such as for call centres. Both city taxi and AITP vehicle must have CCTV cameras for passenger safety , the Centre has suggested. Meanwhile, to increase the availability of public transport in rural areas as well, the road transport ministry will liberalise the permit regime and will come out with norms to allow vehicles including motorcycle taxis, e-rickshaws and jugaads for ferrying passengers.

“The focus is to improve all forms of public transports both in urban and rural areas,“ said a government official.

App-based services

Surge pricing

Ways people commute, Delhi, Mumbai, Kolkata and Bangalore; Graphic courtesy: The Times of India, April 21, 2016

How fares are determined

The Times of India, Apr 21 2016

Algorithm maps demand & supply, determines fares  

What does surge pricing mean?

Surge pricing comes into effect on cab aggregation platforms like Uber and Ola when customers have to pay a multiple of the usual fares. The fares automatically increase when the demand for taxis is higher than the drivers available in a particular neighbourhood. These apps show customers that the fares are surging and if you accept the surge, your ride is booked with the increased fare. Surge works on a pricing algorithm which maps the demand and supply in every area and hikes the price accordingly. Surge pricing can sometimes be as high as 7-8 times the regular fare.

Why do cab aggregators resort to surge pricing?

Aggregators says surge prices encourage more drivers to get back on to the roads and help them earn more money .Drivers make 80% while cab aggregators take home 20% on each ride and the same applies during surge pricing.The increased fares act as an incentive and make more drivers log in to an Uber or an Ola. Travis Kalanick, Uber's co-founder, tweeted in 2013 saying, “there is a market out there... drivers will go to hotels and other sources if they pay more.“ Ola says `peak pricing' is triggered usually during office hours like 9 am or 6 pm, special events such as a strike or periods of extreme weather.Besides this, surge pricing also kicks in at other times, as commuters have noticed.

Is the supply scarcity artificially created by these cab aggregators?

There's a theory propounded that cab aggregators create an artificial scarcity as drivers stay home and turn off their devices at certain times.This creates a supply slump and the pricing mechanism jacks up the fares. Taxi apps however, deny this allegation.

How will banning surge pricing affect the supply of cabs?

In the cab-aggregation model, players on the platform do not own the taxis, nor do they employ the drivers. So they can't determine the number of cars plying on a certain day . The suspension of surge pricing in Delhi seems to have hit availability of cabs on Tuesday . Commuters complained of not being able to find cabs on the Uber and Ola apps. While some said they got a “no cabs available“ message on the app through the day, others had to wait for a long time, only to find drivers cancelling trips without any explanation. Both Ola and Uber pushed for the carpooling option.

Will the surge pricing ban affect regular fares in future?

For now it is unclear if regular fares will go up on Ola and Uber with a ban on surge pricing, but experts say that could be a possible fallout.

2016: Karnataka’s experience

The Times of India, Apr 21 2016

K'taka shows why it'll be tough to cap surge

Karnataka was the first state to allow startups Ola and Uber to test the market and flourish. It also became the first state to bring strong regulations on the aggregators on April 2.

The new Karnataka On-demand Transportation Technology Aggregators Rules 2016, clearly caps surge pricing and says that the maximum fare charged cannot exceed the government fixed rates. It simply means fares cannot be more than Rs19.5 per km for AC cabs and Rs14.5km for non-AC cabs and that fare should be inclusive of all types of taxes.

But the rule allows companies to charge lower fares than the fixed tariff and hence they can surge prices for the cheaper segment of vehicles in their fleet.

However, both Ola and Uber continue to follow the fare systems as it did before the rule was implemented and surge prices go as high as five times the fare during peak hours and it continues to vary in different parts of the city at different times of the day .

If you are traveling to MG Road from Whitefield or Electronic City at 7 am or 10:30 am, Uber and Ola both charge a minimum of 4 X.This apart from the base fare of Rs40-50 and ride charges that is charged per minute for the entire duration of travel.

This despite over 70 cabs being seized by the enforcement officials of the transport department in the last week, 50 of which belong to Uber, said H G Kumar, secretary , State Transport Authority. The officials themselves book the cabs during peak hours to find whether the companies are charging peak hour rates. Drivers affiliated to both these largest aggregators say that the excess fare charged in the name of surge pricing does not go into their accounts. “If they charge 2 X and the fare is say Rs100 normally, the companies deduct Rs100 from my account and I get the fare at normal rates,“ said Nagappa, one of the cabbies.

On the other side of the fiasco, Uber started a campaign on April 13, against surge pricing and sent e-mails to its users in Bengaluru, Mysuru, Mangaluru, saying that commuters will end up spending more going by the government fixed rates than what they paid through surge pricing. Bhavik Rathod, General Manager for South and West India at Uber told TOI during the launch of the campaign that surge pricing is relative to demand for cabs and their subsequent supply by the company .

“When the demand for cabs in a particular area is high, there is an automated surge in the rates in order to make more cabs available to passengers in that area. Uber's competition is to provide cabs within four minutes to its customers even when the demand is high. In this case, surge pricing will definitely come into play but it is with utmost surety that the amount paid is at least not as high as government prescribed rates,“ said Rathod. “Over the last three months (January 2016 to March 2016) passengers who have traveled with the rates fixed by the government, have ended up paying at least Rs 25 crore -cumulative -more than the amount they paid under surge prices.“

Companies are also mandated to obtain a license as per the new rules at the earliest after implementation and officials in the transport department said both the aggregators have not yet done that.

HC ends surge pricing: 2016

The Times of India, Aug 12 2016

Travelling charges by different means of transport available in Delhi, as on August 12, 2016; Graphic courtesy: The Times of India, Aug 12 2016
Travelling charges by different app-based taxi services in Delhi, as on August 12, 2016; Graphic courtesy: The Times of India, Aug 12 2016

Abhinav Garg

Surge pricing by cab aggregators Ola and Uber must end by August 22, 2016, the Delhi high court ruled on Thursday , giving the app-based services a 10-day deadline to streamline their systems and fall in line with the order. Justice Manmohan said that the cab aggregators had to abide by the fare cap fixed by the Delhi transport department.

The high court relented to a 10-day extension rather than enforce its order with immediate effect after Uber sought time to tweak its software to bring it in line with the government-mandated rates. Ola assured the high court that it had stopped charging passengers more than the notified rates and had given an undertaking to this effect in court. Ola told the HC, through advocates Vijay Sondhi and Gurpreet Singh Kahlon, that it would abide by the affidavit filed earlier by it.

The court acknowledged the contribution of taxi aggregators in reducing pressure on public transport and also in providing more options to the commuter, but underlined the need for “a uniform policy“ to be devised by the government as a regulator. Appearing for the Centre, standing counsel Manish Mohan told the court that for framing a comprehensive regulation at pan India level, the transport ministry set up the panel on May 25 to address licence issues of taxis and aggregators.

HC then asked the special committee to keep in mind a draft policy being prepared by the Delhi government for regulating aggregators, give a proper hearing to all stakeholders and file a final report in three months. It further asked it to include one senior official each from the information technology ministry , Central Pollution Control Board and Delhi Traffic Police to get a better overview, and recommended that the panel seek help from a transport expert in Niti Aayog.

Justice Manmohan advised the Delhi transport department, the Union transport ministry and Delhi Police to work together to ensure “seamless flow of data“ regarding people applying for licence or permit to drive taxis. The court was also of the view that incidents of crimes against women in cabs occurred because police were handicapped due to lack of such data with the taxi operators and aggregators. There is no way to know if the accused cab driver in such cases “had a criminal past“.

Pointing out that entire NCR should be treated as one zone, the court said treating Delhi as a separate entity will be counter-productive since commuters and cab firms were also based in neighbouring ci ties of UP and Haryana and often ran between cities.

As per the rates prescribed by the transport department, the special fare of Radio Taxi cabs (distinguished by an LCD board on roof top displaying `Radio Taxi') is Rs 23 per km.Additional night charge (25% of the fare) is applicable between 11pm and 5am. Regular fares of the app-based taxi service are much lower than this.

Rules for surge pricing: December 2016

The Times of India, Dec 15 2016

New cab norms allow surge pricing up to four times

Dipak Dash

The Centre's new guidelines governing taxi operators across the country will allow aggregators such as Ola and Uber to charge up to three times the minimum fare during the day and up to four times between midnight and 5 am. The guidelines will be submitted to the Delhi high court next week. The minimum fare will have to be submitted to the state transport departments for approval. The guidelines also allow private vehicles to be used as taxis by paying the required fees and getting permissions online.

Cabs with an All India Tourist Permit will be allowed to operate under the aggrega tors. Such vehicles can also be engaged by BPOs, IT companies, government departments and PSUs for long-term hiring.

The price regulation will cover only vehicles that are less than four metres in length, which have been categorised as “economy taxi“. All taxis will have to comply with local fuel and other regulatory norms and have an app-based metering system that must be validated by an agency approved by the IT ministry. Taxis will also need to display the registration number and driver's photograph prominently besides setting up a call centre for attending to SOS.

City taxi operators -kaali-peeli and radio taxis -are likely to protest against the contentious provisions of allowing AITP and private vehicles to operate under aggregators and the decision to take length as a parameter for categorising taxis. “The new definition of metre is created to benefit few select manufacturers and also to accommodate maximum unsafe vehicles without airbags,“ a Mumbai-based major radio taxi operator said.

He alleged the government seems to be under pressure to allow AITP taxi, which have paid Rs 5,000 as license fees to run along side other taxis that have paid Rs 25,000 for getting city taxi license.

Cash vs. ‘wallet’

Digbijay Mishra|At 65%, Uber sees more cash payments than Ola|Jul 12 2017: The Times of India (Delhi)


===Currency Dominance Similar To That Of Cash-On-Delivery Option In E-Commerce===

Cash is the dominant mode of payment for taxi rides for the leading appbased cab-hailing firms in India. Uber gets almost 65% of all payments in cash here, while only 30% rides are paid through the mobile wallet Paytm, according to data shared with TOI by Superfly Insights, a San Francisco-based data analytics company .This is in complete contrast to the US and other developed markets. India was the first country where Uber enabled cash payments in a phased manner back in 2015. Uber's former CEO Travis Kalanick had told TOI last year in an interview that accepting cash in India was a very difficult decision to make as it was one of the non-negotiables for the company .

The taxi app's Indian rival Ola has always accepted cash as a payment and is also witnessing higher usage of this option. Data from Superfly Insights said that 51% of Ola riders paid through cash, while its own digital wallet Ola Money was used by 45%.The non-cash payments also include options such as debit and credit cards. Ola Money had a share of 54% in January while cash payments had a share of 45%. The higher numbers for digital payments is credited to demonetisation, which was announced in November last year.

The preponderance of cash transactions goes against the objective of cab-hailing apps to provide a seamless experience where a customer can simply walk away after a ride with the fare being automatically debited.Payment companies, howe ver, point out that this is similar to the experience of ecommerce in India where a large number of consumers continue to opt for cash-ondelivery despite debit cards becoming ubiquitous. They attribute this partly to customers wanting to retain control, and trust deficit concer ning grievance redressal mechanisms.

Jonathan Meiri, CEO of Superfly Insights, said, “In two of Uber's largest ridesharing battlefields -Brazil and India, with massive market opportunity -cash is (still) king.“ In Brazil, over 25% rides are paid for in cash. In India, Uber is also in final stages to join the latest digital platform Unified Payments Interface (UPI).

The India-specific data was corroborated with anonymised SMS panel of roughly 5 million users in India (1 million monthly active users). The analysis is as of rides in May .

While debit and credit cards are still small as a mode of payment, Ola is witnes sing growth in this segment.The home-grown company saw credit card payments go over 3% compared to less than a percentage point at the beginning of the year.

Taxi traffic.PNG

A spokesperson for Ola refused to comment on the story , while an Uber spokesperson said in an email that since demonetisation, there has been an uptick in digital payment methods. “We are enthused by the recent moves of the government towards mainstreaming digital payments and are currently evaluating possibilities around a comprehensive UPI integration as we engage with the relevant stakeholders“. As a first step, Uber will offer riders the option to use their existing UPI IDs.

Satish Meena, an analyst at Forrester, said, “It is still some time for India to see non-cash payment methods ruling the charts. Also, the transaction sizes are smaller than a typical e-commerce ticket size. Digital payment methods saw an uptick during demonetisation but with adequate currency in market, cash has become the first option for payments.“

Diesel taxis

Registration increases sharply 2014-16

The Times of India, May 05 2016

Jayashree Nandi  In 2014-15, more than 11,000 diesel taxis were registered in Delhi alone. EPCA on Wednesday held a meeting with various taxi operators, including those holding an all-India tourist permit (AITP) and aggregators, in order to prepare a strategy on how diesel taxis on AITP could be phased out.

Officials from both central and state governments heard taxi operators and studied their permit conditions closely. EPCA hasn't arrived at any decision yet but it is likely to present their phase-out plan to the apex court on Friday . This is the first meeting EPCA had with taxi operators after SC recently ordered only CNG cabs would be allowed to run in the city from May 1onwards.

SC had given a two-day deadline to the AAP government for filing a detailed plan on phasing out of diesel cabs. “The spurt in diesel taxi registrations is because aggregators organised soft loans for drivers to buy vehicles and gave them some money upfront. Since they wanted to do inter-city services, these diesel taxis were registered under AITP,“ said one of the experts who attended the EPCA meeting.

EPCA heard the concerns raised by taxi operators and possible solutions suggested by them.There was quite a bit of altercation between AITP operators and aggregators--Ola and Uber. Many demanded that their taxis be allowed to run for eight-nine years.Some suggested that SC be requested to pass an order, which would ensure that aggregators compensate their drivers who were pushed to buy diesel taxis.

Another suggestion was that an affidavit be taken from AITP taxis that they would do only inter-city services. Some operators even tried to convince EPCA members that the order was only meant for taxis running on city permits but not on national permits.But EPCA members reminded them that as early as 1998, the courts ordered that only CNG taxis would be registered in Delhi.

Trends, year-wise


Aggregator rides increase 280%

Cab aggregator rides surge 280% in 2016, Feb 18, 2017: The Times of India

Despite regulatory challenges and supply side disruptions, online cab aggregators like Uber and Ola completed half a billion rides in 2016, as per a report by business research firm RedSeer Consulting. This is a 280% growth compared to 2015, when the industry witnessed 130 million rides.

SoftBank-backed, home grown company Ola and San Francisco-based Uber account for much of the market. In an earlier report, RedSeer Consulting had noted that demonetisation worked in favour of cab aggregators, unlike for e-retailers.

“The Indian online cab aggregators had a very successful year in terms of increasing market size, maintaining a strong supply of drivers, and promoting features like carpooling for consumers and leasing for drivers. Some minor hiccups like lack of clarity on the ever-changing regulations and unrest among sections of drivers are things these players would have to counter in the coming year and we can expect the industry to keep growing in 2017,“ said Anil Kumar, founder and CEO, RedSeer Consulting.Both Uber and Ola have been aggressively investing in the Indian market, bringing cheaper products and offering services like ride sharing and rentals. Ola introduced the Micro service last year, making it cheaper than Uber's cheapest ride. The fight between the two players has intensified.

Lost and Found Index: Uber

See graphic

What Indians leave behind in taxis; The Times of India, Mar 31, 2017

Driver of public vehicle expected to know regional language

Rosy Sequeira, Bombay HC: Not unreasonable to ask auto drivers to know Marathi, Nov 18 2016 : The Times of India

Mumbai:The Bombay high court on Thursday declined to stay a state circular which said autorickshaw drivers must have an adequate knowledge of Marathi to get permits. A bench of Justice Vidyasagar Kanade and Justice Nutan Sardessai said, “Such a condition is not unreasonable because a driver of a public vehicle is expected to know the regional language so he can understand directions given by commuters. We, therefore, do not propose to grant a stay.“

The court gave the ruling on a petition filed by the Mira Bhayandar Republican Rickshaw Chalak Malak Union urging it to quash the February 20 circular issued by the state transport commissioner.

The union also wanted the court to direct the regional transport commissioner (Thane) to issue permits to its members. The union's advocate Suhas Deokar argued that the Nagpur bench of the high court had earlier this year stayed the circular and directed that permits be issued by a local autorickshaw union.

“The government had filed an affidavit in that matter stating that it would not insist on the circular compelling drivers to have Marathi knowledge and would grant permits to candidates otherwise qualified,“ Deokar said, adding that thereafter, another bench of the high court too had granted relief to the autorickshaw union in October.

On Thursday , the judges said they did not agree with the view and wondered what was wrong with the condition.

“Why should a licence be granted when you don't understand Marathi? If you go to Tamil Nadu, you have to speak the local language. You must be in a position to communicate with passengers,“ said Justice Kanade.

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