Mangaluru: Ola cuts minimum fare in city


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Mangaluru, 23 Nov 2015: Ola, the first taxi aggregator to operate in this coastal city, has reduced the minimum starting fare by 50% for its services, making it an attractive proposition for customers.

 

 

The minimum starting fare has been reduced to Rs 49 for two km from Rs 99 for a 4km distance. This makes taxi aggregator services attractive for auto users and the internal turmoil has been handled with the aggregator assuring the operators a minimum business guarantee (MBG) of Rs 4,750 per week.

 

The minimum fare had been hiked in August from Rs 49 for two km to Rs 99 for four km distance, reducing the rate for subsequent kilometres at Rs 9. This was earlier at Rs 10 per km in Mangaluru and Rs 11 from Rs 12 for sedans.

 

Sources said the drivers wanted a fixed plan which guaranteed their income even in the absence of bookings. "Business can only grow if they help us and are ready to work,’’ said the source. According to the new MBG plan, the driver will have to get a minimum of 30 bookings and a maximum of 80 bookings per week. If the driver gets 80 bookings, he will be given an MBG of Rs 15,500 for a mini and Rs 18,000 for sedan. In case of minimum bookings of 30, the MBG for a mini will be Rs 4,750 and Rs 5,000 for a sedan. What this means is, if a driver gets 30 bookings in a week and even if he generates Rs 3,000 gross revenue, he would be compensated Rs 1,750 by the company ensuring his MBG.

 

When Ola entered Mangaluru market, a fixed model guaranteed a driver minimum income of Rs 32,000 to Rs 36,000 irrespective of bookings in the initial stage. Later the fixed model was changed into commission model, where drivers felt that they were being short-changed during dry runs, causing trouble for Ola. Now with the MBG, things are getting back on track for Ola, say insiders.

 

 

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