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Uber, Ola facing heat on surge pricing

Taxi hailing companies such as Uber and Ola, which have been directed by the Karnataka government not to indulge in ‘surge pricing’ are facing the heat elsewhere in the country as well.

While the Maharashtra government is also planning to impose some curbs on surge pricing, the Delhi high court has sought a report from the state government on the practice engaged by taxi-hailing companies.

Magic Sewa, also a start-up in the transport segment, has filed a plea in the court accusing Uber and Ola of violating a government notification on fares by under-pricing or over-pricing.

According to the company, peak time charges or surge pricing sees customers being charged as high as five times the normal fare. “Attracting a prospective passenger with a published fare as low as Rs. 5 per km but charging as high as Rs. 38 per km in the name of 'peak time charge' or 'surge pricing' is downright misleading, mischievous and cheating,” said the complaint.

Such unlawful practices of unlicensed taxi aggregators was adversely affecting the livelihood of the petition, whose survival is at stake, it said.

The Delhi high court also felt that the complaint prima facie appeared to be a public interest litigation and has asked the petitioner to file before an appropriate bench.