The ‘temporary suspension’ of surge pricing may result in fewer cabs on Delhi roads, app-based taxi aggregator Uber informed its customers on Tuesday.
“No surge means that availability and reliability will take a hit. We’re working hard on getting more cars out on the road. Bear with us,” Uber Delhi informed its customers through Twitter and personal messages.
Uber advised commuters to switch to uberPOOL - a car pooling service - and uberMOTO - a bike-sharing service until they get more cars on the road.
An algorithm helps cab services like Ola and Uber to fix the price based on how many cars are available on the road and the number of customers in need of a ride. If demand increases then the price also increases - this concept is called ‘surge pricing’.
This technique reduces the demand as commuters would choose alternate transport and increases supply as taxi drivers would want to earn more money.
While according to Uber the algorithm is developed to maximise number of rides and not to increase the revenue, the Delhi HC on Monday asked the govt to file a status report on what action is it taking against the taxi operators who flout rules.
“When people are made to suffer the government cannot wash its hands and fail to take action. Government cannot be helpless,” Justice JR Midha said .
The Delhi govt cracked its whip on Monday against the app-based taxi services by impounding 18 cabs of Ola and Uber for charging fares more than the prescribed rates during the odd-even car rationing period.
A senior government official said the cabs were impounded last evening after an order was issued to the Transport Department to take strict action against such companies in the face of mounting criticism for manifold increase in fares.
“We impounded 18 cabs of Ola and Uber last evening after receiving complaints of overcharging from commuters. Most of the cabs belong to Uber,” the official said.
Ola and Uber on Monday suspended ‘surge pricing’ in Delhi after chief minister Arvind Kejriwal ordered strict action, including permit cancellation and impounding against overcharging by taxis.
On April 7, the Karnataka government had banned surge pricing in Bengaluru.