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Forget today's strike, future tense for Ola, Uber

With the initiation of CNG and comeback of radio cabs, the road seems tough for aggregator cab drivers

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Even as a section of Ola and Uber drivers have threatened a token strike on Friday, the ground reality is that the trade — after a robust start in the last few years — is set to face several corrections. These corrections, transport officials said, will bring down revenues of aggregator cab drivers further.

Among the corrections the officials spoke about was the introduction of Compressed Natural Gas as the fuel of choice for these cabs, the entry of banks and car rental and finance firms giving cheap loans to buy tourist cabs, and the government's move to make the taxi trade a level playing field with radio cabs.

On reducing operational costs due to CNG, Mahanagar Gas Limited (MGL), in reply to a query, said that the saving in CNG in cost per kilometre when compared to petrol will be at 62 per cent and diesel at 46 per cent. "The cost per kilometre of diesel is Rs 3.61, and that of CNG (per kilogram) is Rs 1.94," MGL said.

Local trains in Mumbai have already started displaying ads of banks and car rental and finance firms that are tying up with car dealers to lure people to avail cheap loans to buy tourist cabs. Speaking to DNA, AL Quadros, veteran taxi union leader, confirmed the dark cloud. "No market, including that of aggregator cabs, can run without a proper ratio between demand and supply. In Mumbai, these cabs are increasing exponentially, but the clientele is static. Obviously the drivers will soon realise Ola and Uber tricked them," said Quadros.

Mumbai Rickshawmen's Union chief Thampi Kurian said the upcoming metros will also hit the trade. "The Versova-Andheri-Ghatkopar Metro has almost finished the rickshaw trade in Andheri (West). Similarly, newer metros will hit the ridership of aggregator cabs by almost 50 per cent because office-goers who prefer these cabs will shift to the Metro," said Kurian.

The other issue that will worry the aggregator firms is the comeback of radio cabs. These cabs have started advertising in newspapers once again, with their marketing teams fanning out to get clients. "The fact that aggregator cab drivers have to regularise their permits now by paying Rs 2.61 lakh or Rs 25,000, depending on the engine capacity of the cab, means that it is no longer going to be easy for drivers to join aggregator firms with just an All-India Tourist Permit (AITP).

Queries sent to Ola and Uber did not elicit any response.

MAJOR BLOCKS

  • Lower fares due to lower operation costs for drivers leads to lower incentives
     
  • Increase in cars and drivers as banks start giving cheap loans for tourist cabs
     
  • Strong comeback of radio cabs
     
  • The start of Metro lines that could take away a substantial chunk of ridership on important routes
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