Uber, Ola suspend surge pricing in Delhi

Commuters can now book taxi rides through mobile apps, at least during the odd-even II period, without worrying about paying more than the usual fares.App-based cab hiring services Uber and Ola have agreed to suspend `surge pricing' following a notice by the Delhi government, reacting to complaints of overcharging from commuters.
The high cab fares on Monday, the first full working day of AAP government's road rationing plan, had Delhi CM Arvind Kejriwal issue a warning to app-based companies of permit cancellations and impounding of vehicles if they charged more than the government approved rates.
A little later, both Uber and Ola announced a rollback of surge pricing, a mechanism wherein rates increase in proportion to demand.
The complaints had starting pouring in from morning, with commuters taking to social media and calling in on the Delhi government helpline to register their protest. Unlike other days, on Monday , the peak hours on these apps went on beyond the office hours, till well into the afternoon.
The increased demand -besides office-goers, parents were booking cabs to ferry kids from school -led to prices going up by as much as five times. Despite the surge, demand remained high and many commuters complained of being stood up by their drivers, or having to wait 15 minutes or more for their cab. Some commuters had even started online petitions against surge pricing.One such petition had 56,505 signatures by Monday evening.
The pricing tool took a toll by afternoon, when Kejriwal tweeted: “Strict action, including permit cancellation and impounding vehicle, to be taken against taxis which charge rates more than govt prescribed rates“. This was followed up by a notice from the transport department to the app-based taxi services, spelling out the various taxi schemes and the fares that could be charged by them, including radio taxi scheme fares, which are Rs.23 per km.
The notice had an immediate effect as both Uber and Ola announced a suspension of surge pricing for an undisclosed period. “Given the threat of the Delhi government to cancel permits and im pound vehicles of our driver partners, we are temporarily suspending surge in Delhi with immediate effect,“ said Gagan Bhatia of Uber North. “We hope to work with the government to keep Delhi moving especially during this time when the citizens need us the most,“ he added.
Ola followed suit. “To make government's odd-even initiative a success, Ola has temporarily pulled out peak pricing in Delhi NCR,“ said Deep Singh of Ola. Dinesh Varshney, a Delhi University professor and a member of CPI's Delhi state unit, said the increased taxi fares were unacceptable.“Public transport is not adequate to meet the city's demand. This weakness is being exploited by Uber and Ola. The Delhi State Council of CPI condemns this loot and demands that it must stop immediately,“ he said.
Interestingly , the Delhi transport department had banned both app-based companies from plying in the city in December 2014, citing a host of issues such as cabs with all India permits plying within the city and lack of the mandatory public service vehicle (PSV) badge.
These issues remain, although the court permitted the companies to operate after they claimed to have switched to CNG fuel.
This is the first action from the Delhi government on the issue of surge pricing.

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