The Karnataka government has seized cars from online cab aggregators Ola and Uber for charging their users over the government decided rate of Rs 19.5/km, reports Mint. The report cited Dr Ramegowda, Bangalore’s transport commissioner, as saying that over 30 cars had been impounded for implementing surge pricing. We’ve reached out to Uber and Ola as well as the Karnataka transport department and will update this when we hear from them. Surge pricing is a technique used by both Uber and Ola to increase fares (1.5x, 2x etc.) to provide drivers the incentive of keeping their cab running, while also making it available for the user, no matter how much the demand for one. Government stays cab rate at Rs 19.5/km Earlier this month, the Karnataka government banned surge pricing, as a part of its rules for online cab aggregators in the state. According to the ET report, multiple cab operators like Uber, Ola, Meru, Mega, Bangalore Taxi etc operate under the Radio Taxi Scheme and not the ‘Karnataka On Demand Transportation Technology Aggregators Rules, 2016’. Surge pricing backfires Last week, Uber put up a blog post explaining the need for surge pricing, reiterating what it has been saying since inception: surge pricing allows users to get cabs even on a busy day. However, users haven’t been happy. Most recently, a user saw prices as high as 7.3x in Hyderabad making it impossible for him to get a Uber cab. Despite this, the company states that ‘nearly all’ of surge…
