Bengaluru

In Bengaluru, driver-partners of cab aggregators resorting to cab distress sale

Drivers, working with Ola and Uber, have been protesting since last December asking for the government to intervene to protect their incomes.

Drivers, working with Ola and Uber, have been protesting since last December asking for the government to intervene to protect their incomes.  

Many say their earnings have dropped as aggregators have slashed their incentive

The cab-aggregator model, which for a brief time brought smiles to the faces of both customers and driver-partners, seems to be headed for a decline in Bengaluru. Faced with mounting payments and falling revenues, drivers who signed up with aggregator companies have slowly started abandoning ship and selling their cars.

Many drivers said their earnings dropped as the companies cut down their incentive.

While there are no official figures on how many drivers are registered with the two biggest aggregators in the city, many drivers said they are planning an exit from the aggregator-based model.

While once they earned an average of ₹70,000 to ₹80,000 a month, their income has dropped to ₹20,000 now. For those who cannot afford to live in Bengaluru on their earnings, this means selling their cars and moving back to their home town.

An indicator of this is an increase in the number of pre-owned yellow board vehicles put up for sale. From wanting to settle loans to planning on shifting out of the city, many distressed drivers are trying to sell their vehicles, leading to a price drop. “Every day, at least two drivers enquire about the price they would get for their cars,” said Rafiq, a used car dealer on K.R. Road near Basavanagudi.

 

In Bengaluru, driver-partners of cab aggregators resorting to cab distress sale
 

Even here, drivers have been stymied by the sheer number of cars on offer. “I went to two dealers to see what price I would get for my car. They simply pointed to a line of cars waiting to be sold. I was hoping for enough money to pay off my debts and move back, but buyers are tough to find,” said Shambulinga, a driver with one of the aggregator companies in the city.

While car owners are queuing up to sell their vehicles, those who took cars on lease and on loan are finding it trickier to exit the business.

“It would not be possible for me to sell my car for such a low price. The alternative is to keep looking for other work. I upgraded from an autorickshaw, and now I have realised that there is more money to be made driving an auto,” rued Harsha, a driver.

Minimum fares not fixed; drivers anxious

A policy by the State government, which promised to bring some relief to cab drivers after aggregator companies cut down their incentives — resulting in a drop in their earnings — is yet to be implemented. Minimum fares, likely to be around ₹10 for non-air-conditioned cabs and ₹12 for air-conditioned cabs, were suggested by the Transport Department in March. The report, however, was sent back for public consultation and the final recommendation is yet to be submitted, according to officials.

In the absence of this protection, drivers said the earnings are simply not sufficient to meet their responsibilities. “The incentives have decreased a lot and the time window for increased earnings has also come down in the past one month. Today, from 9 a.m. to 2 p.m., I have just earned ₹96. On most days, earnings are quite low,” said Rajesh, who drives for a popular aggregator company, on Wednesday.

While drivers are waiting anxiously for the government to notify the new rates, the companies are cutting down earnings further, drivers allege. “The commission per ride is around 30% and it keeps changing. But we are being charged more per ride in the past two days,” said Manjunath, another driver.

Uber said there were sustainable earning opportunities for driver-partners. “We currently have 2,40,000 active driver-partners (across the country) and are seeing more and more sign-ups every day, a testament to how driving for Uber continues to remain a preferred entrepreneurial activity,” an Uber spokesperson said. According to Uber, commissions charged by the company were not in the range of 30% and were significantly lesser.

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Printable version | Jul 4, 2020 1:19:35 PM | https://www.thehindu.com/news/cities/bangalore/drivers-resorting-to-distress-sale-of-cabs-to-exit-business/article19199840.ece

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