Uber challenges Maha govt cap on pricing in draft city taxi rules


MUMBAI: App-based aggregator Uber petitioned state chief minister Devendra Fadnavis against the proposed cap on pricing (fares) in the draft in Maharashtra city taxi rules, claiming it will make cab service unreliable due to longer waiting time.

Uber sources said surge pricing was an effective algorithm to ensure more cabs on roads, and pricing encouraged more drivers to cater to demand from riders. The rules draft mentions that “the licensing authority shall prescribe minimum and maximum limits for fares, with respect to vehicles operating under app-based taxi permits. Fares will be decided by the state as per type of vehicle”.

Uber said the price flexibility (especially low-end fares) had allowed consumers access to reliable and affordable services across Mumbai. A price floor will prevent it from offering affordable services and a cap on pricing will make the service unreliable, it added.

It also objected to the push towards more premium cars and steep permit fees. The petition said, “Taxi (Kaali Peeli) drivers are feeling the pressure from services like Uber. But the answer is to level the playing field by reducing today’s burdensome regulations, not to introduce rules that will be bad for riders and drivers.

“The rules suggest that ride-sharing apps should ensure half the fleet of cars on the platform are over 1,400cc capacity. The push towards more premium cars will mean more economical and fuel-efficient cars being pushed out from the platform. It will take away freedom and flexibility of drivers to have vehicles of their choice, forcing them to buy more expensive cars, which will push up fares,” it stated.

The new permit will come for a fee which starts at Rs 25,000 and goes up to Rs 2.61 lakh for above 1,400cc engine cabs. “This will make it unviable for driver partners to operate, restricting the number of people who can join the platform. This will also mean longer waiting time and higher prices for riders as reliability of service will suffer. The requirement for Uber to deposit Rs 50 lakh per 1,000 vehicles will make the business unviable,” the petition, a copy of which is with TOI, stated.

 Uber informed the government that it wanted to address challenges like congestion and pollution control, and did not object to the clause on clean fuel although most of its cabs run on diesel. “The world over, the growth of the on-demand economy has made policy-makers realize the need for smart and progressive regulations that will allow technology-based companies like Uber to change the lives of citizens for the better. Maharashtra can lead the way,” it said.
 “Uber is also providing a livelihood with dignity and opportunities to thousands of driver partners across Maharashtra. We welcome suggestion to have a separate permit for app-based taxis in the state. But some rules, if adopted, will mean an end to the Uber that Mumbai knows and loves today,” it added.

This article was originally published on TimesOfIndia

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