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BENGALURU: Why are Bengalureans increasingly finding it difficult to get an Uber taxi on time, especially during peak hours?

This is the question that is nagging a majority of regular cab users in the city in recent weeks what with Uber drivers either not picking the ride or telling the passengers to cancel the ride after learning about the destination.

When the Times of India asked a couple of Uber drivers on what compels them not to pick the ride when they could actually be making more money, they retorted: The earnings are dwindling and it is no longer lucrative to drive through the traffic gridlocks in Bengaluru.

Currently, 20 per cent of a Uber trip fare goes as commission to the cab-aggregator, 5 per cent is GST and the remaining 75 per cent is retained by the cabbie. The driver is expected to complete 62 trips per week to get incentives. “But when we are stuck in traffic most of the time how can we reach the destination?” asked Uber driver Janardhan K while stating that he prefers to avoid picking passengers in busy areas, especially the central business district and tech parks, during peak hours.

Uber India executives, while acknowledging the problem, blame it on the regulatory cap imposed by the Karnataka government on the dynamic pricing model (which kicks in automatically when there are more ideas than drivers in a given area). The state government, following protests against indiscriminate surge pricing practices, had two years ago fixed a minimum and maximum fare for app-based cab aggregators with slabs based on the cost of the vehicle. For a sedan that costs between Rs 5-10 lakh, the minimum fare per km is Rs 12 and the maximum fare is Rs 24.

“But the drivers do not get adequately compensated because of the government cap on the fares and, hence, there is lower incentive to drive during peak hours and in congested areas. Drivers can see the demand for cabs in a particular area but are not motivated to reach the place as they cannot collect more than what has been capped," said Uber India and South Asia (Head of Cities) Prabhjeet Singh while emphasizing that dynamic pricing without any cap will bail out both drivers and stranded passengers.

“When the rider is willing to pay higher fare during peak hours the Rs 24 per km cap does not allow for it,” Singh said and added: “The fare cap leads to a vicious circle where reduced earnings result in reduced supply of cars and that, in turn, reduces demand for cabs in the long term.”

In fact, Uber recently did a comparative study on Bengaluru and Hyderabad by sourcing data for two months and what emerged was not positive. Singh said: “A driver in Bengaluru earns 8-15 per cent lower than that of his counterparts in Hyderabad because of the price cap. In fact, the net take home of a Bengaluru driver is 20-25 per cent lower. If changes are not brought in (with regard to regulatory cap) the driver-entrepreneurs would prefer to attach their vehicles to car-rental companies and people would prefer to use their personal vehicles.”

Unlike other cities that have CNG vehicles what pinches a Bengaluru driver more is the increasing operational cost of his diesel car and slow-moving traffic.

“Maybe, a time-based dynamic pricing will allow drivers to earn more in the high traffic situations,” Singh said and adding, “Currently, two of the five requests for a cab are not getting completed because of the cap on pricing.”

However, not all are enthused by Uber’s demand for the removal of the cap on fare structure. “There are two risks here: One, the customers will be fleeced with exorbitant fares. Two, the cab-aggregator will increase its commission and, thereby, eat into driver earnings,” a transport department official said.

