Auto fare cap: Uber threatens to curtail service in Bengaluru

Uber has threatened to curtail its auto-rickshaw services in Bengaluru if the state government doesn't lift the 10 per cent commission cap.

In a proposal submitted to the Transport Department, the ride-hailing company said it must charge 25 per cent more than the meter fare to stay in business.

The High Court of Karnataka has allowed Uber and Ola to charge 10 per cent more than the meter fare plus applicable GST for their auto-rickshaw services in the city. The court directive came on October 14, three days after the department banned e-hail auto services, calling them illegal.

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The controversy erupted after Uber and Ola were found charging a base fare of Rs 100, more than three times the Rs 30 fixed by the government.

In the interim order, the court restrained the government from taking any coercive action against ride aggregators. The government told the court that it was willing to fix fares for e-hail auto services in 10-15 days by holding talks with ride aggregators and other stakeholders. However, both sides have stuck to their stances despite several meetings.

Upping the ante, Nitish Bhushan, Head of Central Operations, Uber India and South Asia, said the firm won't be able to operate with the 10 per cent commission for long. "In the face of these commission caps, we may have to make the difficult decision to limit Uber Auto to select parts of Bengaluru where the service is viable," he wrote in a blog post.

Speaking to DH, Bhushan insisted that the threat was "not a pressure tactic". "e-hail services are fundamentally different. We incur significant costs to provide value-added services. The driver goes to the doorstep location. There are fuel, time and other costs. We believe the 10 per cent commission is not the right deal," he explained.

According to Uber, one million passengers and 50,000 drivers use its auto service in Bengaluru every month.

On auto drivers' own app

Uber welcomed the launch of Namma Yatri, a ride-hailing app launched by auto drivers in Bengaluru.

Bhushan said: "Choice is helpful. Bengaluru is a thriving ecosystem. The more players come into the ecosystem, the more value will be added. It will help innovate."

He disagreed that drivers had launched the app because Uber doesn't compensate them fairly. "Numbers speak otherwise. We wouldn't see so many drivers signing up if they didn't perceive value," he added.