uber and ola to-surge-price

Central Government’s new guidelines for taxi operators now allows surge pricing in taxis. These new guidelines allow aggregators like Ola and Uber to charge surge pricing. The surge pricing of cabs will take unfold for 3 times during the day and for four times during the night.
The taxi service providers need an approval from the state transport departments about the minimum fare. However, they will have all the liberty to fix the cap.

According to the new norms, private vehicles can be used as taxis by paying a fee and can avail their permissions online. New Pricing rules will categorize the vehicles less than four meters in length as ‘economy taxi.’ These new cabs should be validated by an app-based metering system approved by the IT ministry.

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Apart from the local fuel norms, the taxis should display the registration number along with driver’s photo and set up a call center is mandatory. Delhi Government has banned surge pricing all over the city back in August this year. It is also reported that Bengaluru police has also seized Ola and Uber cabs for the same surge issue. In the same month, Delhi CM Arvind Kejriwal declared the ban on surge pricing would be permanent

Few sections of customers were happy as Government took an initiative to strangle new business models and discouraging entrepreneurship. This move is considered more of condemning free market by Government intervention.

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This recent decision by Government solves the taxi crisis and on the other hand it also encouraging customers to pay high charges for service. All India Tourist Permit and local taxis can now work with online taxi aggregators. A buzz is that consumers can get more options to choose among the best price.

The new norms also allow taxi service providers to serve IT firms, BPOs, and Govt. establishments under long-term contracts.