Surge-Pricing Of Cab Fares Could Soon Become A Thing Of The Past. Here's Why
Though surge pricing was prohibited by the Delhi government last year, app-based cab aggregators still continue to charge fares that are sometimes two to three times the usual fare.
Remember that dastardly surge pricing that goes out of whack every time it rains or just when you want to go out on a Friday night? It might be going away!
Delhi government plans to ban surge pricing by app-based cab aggregators, transport minister Kailash Gahlot said. "We will not allow surge pricing in the city. We are going to put a cap on the maximum fare that cabs can charge from passengers," Gahlot said in an interview to Times Of India. He said that app-based cab aggregators may be allowed to charge some extra amount above the base price per kilometre but that amount would be fixed and strictly enforced.
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The provision to put a cap on the maximum fare that can be charged by cab aggregators is a part of the government's City Taxi Scheme 2017, which is being finalised at the moment. The scheme aims to reg the late operation of app-based cab aggregators, among others, in the city.
Sources in the Delhi government's transport department said that deliberations are on about fixing the maximum fares that can be charged by cabs. "The amount is likely to be around Rs 10 per kilometre above the base price but nothing has been finalised yet. Meetings are being held to iron out these issues," a government official said.
Though surge pricing was prohibited by the Delhi government last year during the second phase of odd-even road rationing scheme, app-based cab aggregators still continue to charge fares that are sometimes two to three times the usual fare.
bccl/representational image
One such experience was on August 7, when heavy rains, coupled with Rakshabandhan celebrations in the city led to a spike in the demand for cabs. As a result, many passengers complained that they had to cough up double or sometimes three times the usual fare for a cab ride.
App-based cab aggregators argue that surge pricing, or 'dynamic pricing' as they call it, incentivises drivers to bring out their vehicles on the road on days of spiked demand, thereby increasing the availability of cabs.
"Upfront fares are calculated using an algorithm that takes into consideration the expected time and distance of the trip, local traffic patterns, demand and supply at a given location. We're able to use past data to estimate the likely cost of the trip and can present that price to a rider before they request for a ride," an Uber spokesperson had told TOI when asked why passengers are charged more on days that see a higher demand for cabs.
"When dynamic pricing kicks in due to high demand, it incentivises driver partners to get their cars out on the roads to address the demand. In the process, we are able to not just predict demand and supply but also bring down the wait times for riders," the spokesperson added.
Good news for commuters!