How do I get to work? Delhi’s Uber story
I hate driving in the city. Its not just the traffic or roads designed specifically to make merging traffic a nightmare. It’s also the endless Delhi heat, our collective disdain for any traffic rules and the endless game of ‘should I just drive over that pot hole or inch through it to see how deep it goes’.
It wasn’t always this way. I have a car (woah lucky me) that I reluctantly bought when I realised that I couldn’t go everywhere with the Metro. I tried buses and auto’s only to reach meetings with a crumpled shirt heavy with sweat. The sweat wasn’t always mine. And no one likes a smelly dirty person trying to make a presentation. They don’t like him, even if there are no presentations.
Painful sciatica put my driving to an end about July last year. With Uber and Ola (an Indian Taxi hailing app), I realised that I could get to work, go out, come home late and still spend less money. Cabs were cheaper than driving your own car. In fact, my monthly Uber bill was less than my monthly fuel bill. I am not even talking about the monthly maintenance cost or parking fees that you have to pay when you drive your own vehicle. It was just cheaper to unlock your phone and order the many cars that were waiting around for you. I decided, would sell my car in March this year.
But how could Uber and Ola keep their prices so low? How were they paying drivers incentives, when they weren’t even charging customers the actual cost of the ride? These things aren’t really a mystery and have been written about before, you can see how big those incentives were here. But as a customer, there was a sense these prices couldn’t last and that we should take as much advantage of the current pricing as possible. This wasn’t a new idea, it was an idea that eCommerce fostered. When a new entrant came into the market, it offered heavy discount on all products, to lure customers to their platform. So all we did was wait for a new platform, buy whatever we wanted, and when prices started to rise, we simply moved onto the next platform. The thought was, that if Uber and Ola increased fares, some other entrant would still make cheap rides possible (there is a rumour about this that is still floating around. I like ‘cheap rides’ so I won’t talk about that just yet).
The drivers saw something else: opportunity. With driver’s take home increasing from Rs 15,000 a month to over Rs 90,o0o depending on which news report you read, many started taking loans for cars and then started giving out those cars to drivers who in turn got rides from Uber and Ola. In effect, intermediaries were born. Some drivers I spoke to, talked about drivers who had taken loans for four or more cars, on the assumption that Uber and Ola would pay enough to take care of the loan instalments and pay the ‘salaries’ of the driver of those cars. Given the incentives these drivers got, financially, at least in the short term this may have made sense to a lot of people.
Then something changed: there was a glut of taxis on Delhi’s roads. The number of riders, from what I can tell, didn’t rise at the rate at which taxis were added. Drivers started getting fewer rides in a day, then incentives were withdrawn and percentage of the fare demanded by Uber and Ola increased. Suddenly drivers with multiple cars couldn’t service their loans or pay their drivers. And they did what we do when market economics acts like, well market economics, they went on strike asking private companies to raise taxi fares. On the 10th February 2017 taxi drivers went on strike, riders like me couldn’t get taxis anymore. My car selling dream was over. It was time to start looking for autos and buses again.
There are two very Indian things that I saw at play here. First, we want market economics only as long as we make money. The moment the market starts responding to demand and supply, we want the government or the in this case, the private company to bail us out. This is exactly the same way the B-School and Engineering school graduates behaved when large ‘startups’ withdrew offers to their students.
The second, today when I finally got a cab after 11 days, one the first thing the cabbie asked was where I was headed. When I asked why, he told me that certain cab drivers were still on strike and had stationed themselves in key junctures in the city. If they saw a cab that wasn’t on strike, they would try to attack the taxi and driver. Fortunately, we didn’t have to through any of those areas.
Another cabbie just said one thing: ‘I haven’t earned in 11 days. I have to pay off my car loan and feed my family, I can’t afford to go on strike any longer’. Which brings me to two more things: the strike may break as more and more drivers realise that they’re losing revenue they won’t see again. And second, the fundamental issues with Uber (the lack of any job security or perks, the long working hours, their lax policies towards accepting drivers) will remain unchanged.
The real question is this, who suffers more? The consumers who must go back to the sadistic auto drivers? Taxi drivers who’re trying to pay off their car loans and make a living? Of the intermediaries who’re crying foul about not being able to pay off their multiple cars?
First, I need to find a way to go back home tonight.