Meru Slashes Fares by 25% in Delhi

The Economic Times - - Brands: Creating Desire - Shel­ley.Singh@ times­group.com

New Delhi: Taxi op­er­a­tor Meru Cabs has slashed its fares by 25% in Delhi, com­ing out in crit­i­cism of the surge pric­ing pol­icy of ri­vals Uber and Ola, es­pe­cially dur­ing the ex­per­i­men­tal phase when odd and even num­bered cars are ply­ing only on al­ter­nate days.

The new rates will be ef­fec­tive in Delhi from Fri­day till mid-May and will be rolled out to other cities in due course. The re­duced rates may be ex­tended fur­ther de­pend­ing on the re­sponse. “We have seen a 35% in­crease in book­ings dur­ing the cur­rent odd­e­ven phase. We want to make the ser­vice more at­trac­tive to more users and hence have brought down rates,” Sid­dhartha Pahwa, CEO, Meru Cabs said. “We do not see any losses due to this as the lower rates are com­pen­sated by a surge in book­ings.” Rides on a Meru sedan will be down to .₹ 17.25 per km (.`23 ear­lier) and for small cabs to .₹ 11.25 per km (.`15 per km ear­lier.) This brings the rates close to those of­fered by cab ag­gre­ga­tors Ola and Uber.

Pahwa also ar­gued that surge pric­ing is not yet suited for the In­dian mar­ket. “Ideally, in a free mar­ket econ­omy surge pric­ing should be ok. But In In­dia the sup­ply (of cabs) is far lower than de­mand. It is a kind of mo­nop­o­lis­tic sit­u­a­tion as users have no vis­i­bil­ity on num­ber of cabs, while the op­er­a­tors knows how many users are there,” he said.

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