• Wed. Nov 16th, 2022

Fuel Prices and IT Sector WFH Worsen Woes for Taxi Drivers in Hyderabad, Bangalore


Several drivers saw their cars seized because they were unable to afford the IMEs, and many were forced to look for other income options.

The rise in fuel prices in the country has had an impact on everyone. But it had a particularly negative effect on drivers of aggregators such as Ola and Uber, robbing them of their source of income. The COVID-19 pandemic and the lockdowns that followed meant that many of these taxi drivers had already gone months without work and were starting to pile up IMEs and manage households with reduced incomes. In addition, the ever-increasing cost of fuel has made taxi drivers question whether they should keep working.

In both Bengaluru and Hyderabad, taxi drivers have largely been able to earn a decent living from work from the city’s IT sector. However, after the pandemic, with a large majority of IT workers still working from home, they were unable to depend on it for their livelihood.

Murali, an Uber driver in Bengaluru for five years, told TNM that earnings were comfortable in a pre-pandemic world, driven by many customers in the IT industry. Now he says for every Rs 1,000 he spends he only earns around Rs 800.

Murali works almost 12 hours a day but still struggles to make ends meet. “Even though there aren’t that many clients right now, I’m doing it to earn enough to meet the daily expenses. But there is no question of saving even a little for the future despite working long hours, ”he says. Murali, like several other drivers, says that if the ability to drive for IT companies was available (to pick up and drop off employees), they would be happy to use it.

Both in Bengaluru and Hyderabad, drivers say they have to drive much further than before to find a customer, and the frequency has declined. Many drivers interviewed by TNM say that customers are sometimes 5-6 km away, and the fuel consumed to reach them is not compensated. Sometimes the rides come from as far as 12 km, they say.

According to Murali, it was possible to earn around Rs 250 every hour before the pandemic hit. Now he says it comes down to Rs 100. This, after driving around looking for clients for hours and spending a lot of time on the road waiting, he says. He further points out that a large part of his income is spent on the purchase of fuel.

Rising fuel prices, lower income

The price of diesel – used by taxis and other utility vehicles because it was previously much cheaper than gasoline – has risen for 30 days over the past 40 days, topping Rs 100 in many parts of the country.

To put things in perspective, the cost of diesel in Bengaluru on November 2, 2021 was Rs 104.5 and in Hyderabad it was Rs 107.4 per liter. On March 16, 2020, before the lockdown, diesel in Bangalore cost Rs 64.4 per liter and Rs 67.8 per liter in Hyderabad.

K Somashekar, leader of the Congress-backed Namma Chalakkara union, says driving for companies like Ola and Uber is like a gamble. According to his estimate, 40 to 50% of people who started driving for taxi aggregators have now switched to another profession.

“It’s really difficult now. The price of diesel is increasing but the mileage of our vehicles remains the same. Our income is decreasing more and more. There is absolutely no way we can save money. Almost 50% of the income goes to pay for fuel, ”he says.

According to Tanveer Pasha, founding president of the Ola Uber driver associations in Bengaluru, drivers were making around Rs 1,000 a day after spending while diesel was around Rs 60. Now he says they have to work longer, and thanks to increasing costs and decreasing rides, are barely making Rs 100-200 per day after spending. He estimated that before the pandemic, for a full tank that would last them 200 km, drivers would spend around Rs 1,000-1,200. Now to cover the same distance he says they have to spend up to Rs 2,000. rupees in fuel.

Forced to leave

These factors have made driving for aggregators unprofitable, to say the least. Driver associations in both cities told TNM that many drivers have been forced to return home, especially after the second lockdown due to lack of income. In addition, because they could not pay the IMEs, cars were reportedly either seized or drivers were forced to refinance their cars.

Tanveer Pasha and Shaik Salauddin, chairman of the Telangana Gig and Platform Workers Union and general secretary of the Indian Federation of App-Based Transport Workers, say financial institutions are pressuring drivers to refund or return their cars. In Bengaluru, Tanveer Pasha estimated the number of taxis seized at 15,000.

“In the name of the incentive and the commission, the companies don’t give us anything. We don’t want incentives, we want what is owed to us. Set our wages where we will be paid a fixed amount for a specific number of trips. Companies are not reducing their commissions either. There is no compromise anywhere, ”says Salauddin.

Kannaiah, who drove a 7-seater car on taxi aggregation platforms in Hyderabad, quit driving for them three months ago after it became unbearable.

“Before the lockdown we are earning decently, whereas even after paying for diesel we had around Rs 1,500 at the end of the day. Now, after commission, we have barely Rs 500 in hand. Now there is no more business. Fuel prices have gone up and the commission is also around 35%, ”he says. This made it impossible to pay the IME on the car, which was higher because he had a bigger car.

“Half of what I did before was going towards EMI. After the lockdown, the financier also started demanding payment, and I was forced to refinance my vehicle. As a result, the amount I had to pay increased, as well as the payment term. I was told to refinance the car or turn over the vehicle. It’s even hard to survive with that. We asked for time, but only the interest increased, ”he says.

He has now moved on to driving for a tour and travel operator, where the money he says is better, although not stable.

Taxis off the road

Bastard says that even though fuel prices continue to rise, the prices charged by aggregation companies to customers are not increasing accordingly. “This is the biggest source of difficulty today. Businesses need to understand and increase the fares that drivers can earn based on rising fuel prices. This seriously affects the income and livelihood of drivers, ”he says.

A price increase was the main demand from the drivers TNM spoke to, who still continue to drive for both companies.

In fact, to fight against prices, the government of Karnataka raised in April the minimum tariffs that aggregators of taxis such as Ola and Uber should charge to Rs 75.

Read: Minimum fares for Uber, Ola and other ridesharing apps to increase in Karnataka: new fares

Ashok Kumar, president of the Ola Uber Drivers Association, alleges that despite this price increase, where a minimum of Rs 18 per km must be charged above the base rate for a car without air conditioning, only Rs 9 are billed to customers. Rs 9 per km was the price when diesel cost around Rs 60 per liter.

“The drivers have been suffering since before the two blockages, and things are much worse after the second blockage. Drivers in Bengaluru city still have to pay rent and survive. In the village, there will be support. People here have no help – rents have gone up, gasoline, fuel and gasoline have all gone up. No one is helping, ”he says.

He adds that if the government created an app with fixed fares and took a commission, drivers would pay the commission for it and the money could go to the government.

The number of taxis, too, has decreased considerably on the roads of these cities, according to the associations.

In Bengaluru, Karnataka’s Additional Transport Commissioner Hemant Kumar said they expected an increase in the number of registered commercial vehicles but remained stagnant. According to him, before the pandemic, there were about 50,000 commercial vehicles (buses, trucks, etc.) registered per month, it is currently between 1,000 and 2,000 vehicles per month. He too says there are fewer cars and taxis on the road.

In terms of government support, the government of Karnataka offered one-time assistance in May 2020 and May 2021 with assistance of Rs 5,000 and Rs 3,000 respectively.

While taxi companies have committed funds for partner-driver vaccinations and disbursement of microloans, there has so far been no communication of a fare increase due to the highest fuel prices ever. recorded. Until then, drivers are only asking for one thing to stay afloat: a decent income.