[blackwasp]

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When we think about taxis, this is the first thing that most of us will associate with:


During those days, we did not have many options to choose from. So, the Ambassador=taxi image has stuck:


If you belong to Mumbai or have ever visited the city, it is impossible to have not seen these. Fondly called the 'kali-peeli' (black and yellow), Premier Padmini's were on the road till not so long ago. Even today you can spot a couple of them:


Now, this is what you hope is your taxi. Well, may not be the best, but it is definitely one of those cars that I'd love to travel in:


Ola and Uber have changed the way we hail taxis in India. They came in at a time when the black and yellow cabs were known to overcharge at airports and railway stations. Private taxis for airport drops charged 2X the fare and using a cab was reserved only when going on a holiday, or in case of an emergency. Today, you will find plenty of app-based taxis in major cities across India:


And this is my taxi. A humble Maruti WagonR CNG. If you have stuck with me till now, let me tell you about my first-hand experiences of running a taxi in Mumbai:

[blackwasp]

Why?

• You might be wondering why I would take on an additional hassle despite all of us in the family having full-time jobs. But this was a learning opportunity. Yes, it is a good source of secondary income, and you get a car with a driver that can be used by mom or someone else in the family who doesn't drive.

• For a fresh off the oven college graduate, it is a good management lesson.

• A dose of entrepreneurship/managing one's own company at a young age is most welcome.

• Understanding and talking to the drivers, hearing their hardships in the city including problems that most of us would consider trivial at best and more...

• One of the most important lessons ever - Understanding the toll on cars doing such duty. I have closely seen cars like the Ritz, Indica, WagonR, Ciaz and Innova / Crysta through the years along with their service costs, breakdown, and other sundry expenses.

The beginnings...

It all started when my aunt knew someone who was in a bad financial state and was looking for work. He was a competent driver so getting him a car seemed a good idea. So, my aunt got a Ritz LXi and enrolled in Uber. I had a good look at how things were working and any questions I had were cleared when I visited the Uber office to get more information.

We brought the WagonR home sometime in October 2016. Back then, I was working with the same dealership, so I could get away with not buying any dealer accessories with the car and getting slightly faster delivery than usual. Unfortunately, WagonR being in hot demand due to Ola and Uber meant that there was a healthy waiting period for the car. We finalised white colour as that was a bit cheaper than the rest (being non-metallic). Accessories, which included fabric seat covers, foot mats, basic USB music system and an Autocop GPS tracker with remote switch-off were fitted from a friend's shop.

Unlike a regular car, you just can’t walk in to a showroom and walk out with the car. There is a process. First of all, you need a company. To that end, I got a Proprietorship license done (basically a Shop and Establishments Act license under the category of Tours and Travels) and using this, opened a current account. Now, commercial cars are taxed annually based on the number of seats. For a 4+1 car, the annual tax is Rs. 8000. The insurance is also slightly expensive as the car is operated as a taxi. I got zero depreciation insurance for my car. I also opted for a loan from State Bank of Bikaner and Jaipur (now SBI). These guys offered me a pretty attractive rate of 8.8%. When I enquired, the manager said that the loan has been disbursed under some entrepreneur scheme and not as a commercial car loan, which generally has a higher rate of interest. I opted for a 4-year loan.

All this, right from the Proprietorship license to the loan disbursement, took about 15-20 days. Once all the payment was given to the dealership, the car's insurance and registration formalities began. I opted to get the car delivered only after getting the registration number, which took a further week or so. Mind you, the RC book hadn't come yet, so I just had the tax paid receipt.

Since Uber requires an RC book to enrol your car on their platform, I decided to start off with Ola.

At the time of writing this post, the car has done almost 80,000 km in less than 1.5 years, and still going strong:

[blackwasp]

Ola or Uber


Back then, Ola used to give a device locked to their app and Google Maps for navigation. It was some cheap Android phone that was pretty buggy. But more on that later.

Unlike a rider (passenger/customer), the operators get incentive schemes, which vary from region to region. These are basically a carrot to run the car during certain times of the day (peak hours) or during holidays, etc. On a weekly basis, this incentive amount used to lie anywhere between 35-50% of the gross income. Now, most of you will say that this is neat, but I saw a problem. This meant that the car had to run with the incentive conditions in mind all the time. This creates a problem - many drivers prefer to take an off during a festival as they have functions back home as well. As an employer, I have to make sure that the staff remains happy. Generally, I used to give one day a week off. Ola accounts were also a bit sketchy - there used to be deductions due to 'complaints', but I observed that the driver rating was very high (4.7-4.9 out of 5). I let this pass for a week and started monitoring from the following week. Further, Ola used to promise something and at the time of paying up, backed out of it. I ran the car with Ola for just a month or so, till my RC book came from the RTO. I haven't gone back to Ola since then. Also, remember the device they give you to run the driver app? Well, that was a bad phone and required frequent replacement, leading to loss of time during business hours. By the time I decided to stop using the Ola platform, they had started allowing any Android phone to be used to run the app. Funnily, when I went to return their phone, I was told there was no provision in their systems to accept this phone. It is still lying in my house somewhere.

Once I got the RC book, I registered on the Uber platform and there was no looking back since. The biggest advantage of Uber is their customer service team. Unlike Ola, which has a telephone operator as default, 99% of the complaints with Uber could be solved via the app itself or an email. These included incorrect fare calculations, customer not giving correct payment, app problems, etc. Very rarely did I have to call the customer care number (yes, they have a small call centre for driver issues).

With Uber, the incentives are in the tune of 20-30% of the income, which means that even if for some reason the target is not met, the income hit would be smaller. In terms of absolute income, Uber is slightly behind Ola, but it is a much, much better partner to do business with. Typically, the company takes a cut of around 20% off every fare. This seems like a big cut, but even so, you run profitably (refer images in the next post for per km earnings). Incentive schemes will compensate for this cut. Also, a big boost to the operators is the surge pricing. Yes, that’s right. All the surge amount is added to the bill and is actually paid to the driver. So, at the end of the day, it’s even more profitable to run the car. Surge pricing is generally applicable during typical office going hours of 7.30-9.00 am and 5.30-8.00 pm. Surges are also affected by local factors like a cricket match, strikes, higher demand due to some fair, rallies and sometimes just due to extra traffic. Drivers can see the surge on the app and take a call if they want to move to that region on not. However, from experience, you tend to understand the areas of peak business and try to go there to get the best chances of getting a longer fare.

Here is a weekly statement with the surge amount mentioned:


The incentive schemes in Uber vary a lot based on the driver rating, city, the car used, etc. My drivers have received incentives based on the total business done (e.g. do a business of Rs. 2500 and get Rs. 3500) and on the number of trips completed (do xx trips and get Rs. yy extra). Since the last year or so, the incentive schemes have more or less remained on the trip basis. It is split into two per week. From Monday to Thursday, 35-42 trips must be completed while Friday to Sunday, it’s around 30-35. Generally, for doing 75 trips a week, you get around Rs. 4000-5000 as an extra incentive (over and above the fare amount). I used to initially pay my drivers on a monthly basis but later switched to per trip basis. My reasoning was simple - you drive more, you earn more. This has worked out nicely so far. If you consider that a driver does around 300 trips a month, he can take home a cool Rs. 30,000. This is the reason for the popularity of Ola / Uber.

Uber also conducts training sessions at their office in Phoenix Market City whenever new changes are incorporated into the app - like pool trips, Mumbai - Pune trips and so on. Generally, it is a good practice to attend these. They last anywhere between 15 to 45 minutes and offer a chance to interact with Uber staff and get any doubts cleared.

The device that a driver uses also matters a lot. Cheaper Android phones tend to heat up and hang, leaving the driver without navigation or, at worst, making the passenger wait for the fare till the phone reboots. Considering all these, and the one phone lost by the driver, I now give an iPhone 5S to the drivers. There are some major reasons for this. I can lock the phone to only use the Uber app and the maps. With a passcode and Apple ID in place, if someone tries to steal it, it is as good as a paperweight. It rarely hangs or heats up, and most importantly, you can set the language to Hindi so that those unfamiliar with English can use the app. This feature has increased the productivity of some of my drivers. These features could also be used on any Android phone, but frankly, I am more familiar with the iOS system.

[blackwasp]

Drivers...

Most of the drivers work for 3-4 months and collect enough money for down payment and buy their own car. However, what happens is that they get complacent and don't think about other expenses like annual tax, insurance, maintenance and eventually end up defaulting on their loans. When you drive for someone, you have to do the work and not get lazy.

Most of the drivers come from other states to make a living and support their families. These are the most hardworking chaps out there. They will just work, work and work. They set a goal that 'I want to earn xx money per day and work towards it'. All the outstation drivers I had were honest and hard working. However, they used to go to their native places once a year for a month or so and at times, simply vanish, i.e., either not come back as promised or delay their arrival. To run a business, you can't wait forever for them to come back.

Not all is good though. Most of the local/native drivers (don't want to take any names of communities here) are some of the laziest I've ever seen. Despite paying them a good salary, they wouldn't earn me anything decent. They simply won't work properly. Add to that starting work late, holidays and simply parking the car and sleeping. One of them also claimed to have been robbed of the device we gave him as well as that day's collection. He took the car home and was not reachable. Thanks to GPS, we wound up at his house and got the car back at least. At one point, we contemplated filing a police complaint for the missing driver, but then let it go.

The drivers that I employed lasted anywhere between 2 weeks to 4 months. Despite being as good to them as possible, they simply don't reciprocate. Some of them used to say they wanted advances for kid’s tuition, or that their kids had bad health etc., and we lent them some money. But all of them never worked enough to return all of it. While the amounts would not make a big dent to us, it has created a sour opinion of any future driver we might hire. Not only have we stopped giving them advances, we have also started being firm. Yes, these chaps do have unique problems, but unfortunately, it can't happen every day.

We have also run the car in two shifts, with one driver doing the night shift and one in the morning. This, though a good deal, is slightly troublesome at times due to the uncertain nature of trips. The night shift driver could come in late and hand over the car after the morning peak hours. Once a driver got a Pune drop around 4 am from the airport. There was no way he could come back before 8 am to hand over the car to the other driver. Eventually one of the drivers just randomly stopped coming to work. If there were any complaints or anything, nothing said. He didn't even bother about that month's salary.

Driver Ratings

This is a key aspect of driving for Uber (Ola as well, but since I have more experience with the former, I will talk about only one of them). My experience tells me that the drivers with the highest ratings usually don't have trouble finding trips. In some cases, Uber sends a new trip request even before the earlier trip has ended.

Customer feedback is also monitored very carefully. In case of a negative remark, the same is told to the driver via the app. These could include better navigation, car cleanliness and driver etiquette. The system is designed to weed out the bad drivers, eventually leading to a ban. But for that, you need to give honest feedback. 5-star ratings should be given to the deserving candidates. What happens is that we (as riders) give all drivers a 5-star rating as default. From the time I started running my car in Uber, I decided to give 4-stars as default and 5-stars only in exceptional cases. I'm happy to say that 7/10 drivers do make an effort to give you a good experience.

Further tools to monitor the driver ratings include the acceptance ratio, total time online and kms done. These are very handy to monitor the driver's performance. They also have an Uber Fleet app for partners to monitor live status of their cars including the current driver trips. Here are some screenshots from the portal (blanked out the personal information):








Here is how a typical statement looks like:


You can also check out stats like these in detail for the week:


Even the ratings and trip acceptance/cancellation can be monitored. The second driver was just sleeping around and thought we wouldn't know. He lasted just a week or so:

[blackwasp]

Some of the things I came to know apart from the ones mentioned previously:

•The e-Challan system of Mumbai police and the different places where they have started the speed cams.

• These drivers tend to have an interesting and wide network. Whenever I wanted a taxi for my relatives, or even a driver to drop a car from one place to another, I was able to get hold of one on very short notice.

• Petrol pump guys become friendly. Since we have a total of 3 cars and one scooter that go to the same bunk most of the times, the people there give good service.

• As the taxi does approximately 150-200 kms (one shift) every day, it needs to refuel at least twice a day. The location being uncertain, I have a fair knowledge of which pumps to avoid.

• Traffic flows, density of cars based on time and general movement of vehicles in Mumbai and surroundings thanks to observing the trips, surge locations, etc.

• The awesome Mumbai Police and how they are on the roads all the time to ensure life in the city never stops - have had my car pass through violent protests, floods and traffic jams. My respect for the uniformed men has only grown. Unfortunately, the same can't be said of the Navi Mumbai or Thane police as during month ends, they keep targeting cabbies to make up their quota.

• The amazing spirit of Mumbai. Last year, during the heavy monsoon, my car was stranded due to a flooded road after a late night trip to Nallasopara. I had instructed my driver not to deny any passenger, as that's the time when one is desperate to reach home. Despite a semi-submerged car, some helpful locals ensured my driver was fed and in a dry spot till the water went down by dawn. They also helped him start the car next morning.

• Some rotten eggs spoil the reputation of cabbies. Whatever we say on Team-BHP regarding our driving experience, most of these cabbies are generally more experienced than us. They know the ins and outs of the city, the lanes to maintain as well as accurate ETA to any destination. They are good highway drivers as well.

Quoting some of the experiences of BHPians:

• Bhpian signs up as an Uber Pool driver.

Originally Posted by quickdraw

Uber announced their Uber Pool platform where you could share your UBER with others, and even gave a chance to private vehicle owners to sign up on the platform! Details here.

I was obviously very excited and quickly decided to sign up and enrolled in the driver program. I have to mention the entire process was very smooth and completely online. I just went, uploaded all the documentation they requested and waited for their approval. I did have to tweet to them a few times to get my account verified.

• A very insightful and sadly accurate description of the discrimination faced by the cabbies. IMHO, the government should do away with the yellow and white plates and rather use just one type of registration. I'll even go ahead and say that the whole country should have random numbers for vehicles through which you can't identify whether that belongs to a particular state or is a taxi or not.

Originally Posted by nishantbhatia84

...
2. Talking about general discrimination on basis of the pricing of the vehicle - speaking from my personal experience:
a. Have driven my Figo to multiple malls / 5-star hotels - have never faced any issues - nor have I faced any issues on the roads.
b. Have driven my Ecosport (on t-permit) to almost all 5-stars, malls, housing societies, etc in Mumbai - professionally and also in personal capacity - have faced an unbelievable amount of discrimination - just because I driving a cab.
So with me discrimination has happened not on basis of the car cost - as the Ecosport costs more than twice than that the Figo - but on the basis of the profession/social status of that person. General assumption of people is: Cab=Driver=Illiterate=Poor + blue-collar job means Respect=0.

I had loads of really entertaining discussions with such people - while making them realize what type of person they are dealing with!

• Uber driver dozes off! What will you do?

Originally Posted by Tejas@perioimpl

This happened last night.
....
I'm 90% sure in my mind that i'll drive the car because it made more sense while weighing the pros and cons and i generally ask him if i should drive. Without battling an eyelid he pulls over and says yes. That means he must have been dead tired.

I told him not to take any new fare and go back home after i get dropped. According to him his house was close to my drop off.
....

This post is just to make sure that you are aware that your uber/ola driver is not sleepy when you get in late at night in a cab.

• One more reason for preferring Uber over Ola.

Originally Posted by nishantbhatia84

I agree! Uber is extremely particular about driver ratings and will not hesitate in suspending a driver account if the driver ratings go below a certain threshold - I've actually seen this happening. That said, they do take driver feedback for passengers seriously as well - a consistently low rating or a report of misbehavior with the driver can result in a temporary or permanent ban of that rider!
All I would say is: It's best to inform the driver of any concerns on the spot - 90 percent of the times this will help.

Related Threads:

Uber vs Ola (Uber vs Ola - Which do you prefer & why?)
Uber Review
The Indian Taxi Revolution
Average earnings of cab drivers?
Car loans difficult for Ola drivers
The Ride-Sharing Thread
Economics of car ownership with Uber / Ola?
When Meru was new

Signing off, I'd like to keep this thread interactive based on any queries that others might have. I would like to invite other BHPians who have similar experiences to come forward and share them here.

[Aditya]

Thread moved from the Assembly Line to Street Experiences. Thanks for sharing!

[Ithaca]

Originally Posted by blackwasp

Why?

• For a fresh off the oven college graduate, it is a good management lesson.

• A dose of entrepreneurship/managing one's own company at a young age is most welcome.

Superb thread @Blackwasp.
Just skimmed through the thread, will read in more detail this evening between WC matches.
Loved the two points about becoming a business owner at an early age to learn what it entails and am sure this experience will give you and others like you the confidence and resolve to try even harder things at later dates.
Will obviously have few queries, but that will come later.

Rating this *****

[aadya]

I had an desire to run cab service with independent operators or with aggregators since long time. I had offered my regular chauffeurs this option - to drive me around day time(would involve 2-2.5hrs of driving) between 8 am and 8pm(they can easily sleep for about 6-8hours) and drive a taxi funded by me. No takers yet. They would request funding without collateral or disappear after few months. One of them ran couple of cabs on his own at the peak of Ola incentives and burnt his fingers as maintenance and interest costs mounted.

[ashis89]

Originally Posted by blackwasp

Signing off, I'd like to keep this thread interactive based on any queries that others might have. I would like to invite other BHPians who have similar experiences to come forward and share them here.

Beautiful thread. Thanks for compiling and sharing your experience in such elaborate manner.

I have been an Uber user throughout. I had a few of questions.

• Do you know how surge pricing works? How does Uber define the area where surge will work?

• Cab drivers in Hyderabad say that once they go to the airport to drop someone, they are assigned a 'queue number' based on the cars waiting for a return passenger. They have to wait anywhere between 6-10 hrs for their turn to come and get a passenger. Is it true?

• If there are 'n' cabs available in my area and I request for a cab, how are they assigned?

[ninjatalli]

Excellent thread - here's a pain point I have seen on numerous Ola and Uber cars - the seat belt buckles on the rear seats get covered by the seat covers - 9 out of 10 cars (both orgs) have this problem. As a result I always sit in front even if I'm the only passenger.

Don't think there is any particular reason why; probably the drivers/owners think the rear seat passengers are fine without a belt on.

[jetsetgo08]

Excellent thread, Blackwasp! Another thread with pure facts and experiences. Glad that your entrepreneurship days have started earlier than most. Off topic, are you still working in the automotive sales?

[hrman]

A lovely thread Blackwasp.
I fully agree with the point of outstation drivers being more hardworking. I didnt know that the attrition is so high and it is difficult to keep a driver for more than 4 months. Most of them have the entrepreneural bug in them (not such a bad thing really) and influenced by their no-good pals back home, they get easily instigated into trying the entrepreneural route without knowing the intricacies (maintenance, fuel, insurance what have you). In the process end up buring their fingers and coming back to the driver route with a string of loan defaults to boast of.


As mentioned by Ashis89, even in Bangalore, I had a peculiar case where one Uber cabbie to the airport requested that he will cancel the trip on the app, but still take us and charge whatever fare the app estimated. This is because they need to do two airport trips per day and will not be able to do if it is through the app or some such thing. Possibly a long queue thing. Is this true?

What is the moolah one can expect after all this? Additionally, does the choice of car have to do anything with economics? (Prime Sedan having higher fares and more income etc?)

[ashis89]

Originally Posted by hrman

As mentioned by Ashis89, even in Bangalore, I had a peculiar case where one Uber cabbie to the airport requested that he will cancel the trip on the app, but still take us and charge whatever fare the app estimated. This is because they need to do two airport trips per day and will not be able to do if it is through the app or some such thing. Possibly a long queue thing. Is this true?

I have experienced one such instance but the driver was frank enough. He asked me at the start of the beginning of the trip if I can pay by cash. His reason was PayTm money takes time to be credited to their accounts and he needed some money. When I said my payment method was fixed as Paytm, he made a 20 m trip and ended it. Then he dropped me at the airport and took only the balance cash (after deducting the short trip fare).

[blackwasp]

Originally Posted by Ithaca

Loved the two points about becoming a business owner at an early age to learn what it entails and am sure this experience will give you and others like you the confidence and resolve to try even harder things at later dates.

Thanks Ithaca!

Originally Posted by aadya

They would request funding without collateral or disappear after few months. One of them ran couple of cabs on his own at the peak of Ola incentives and burnt his fingers as maintenance and interest costs mounted.

There are both positives and negatives to this. Most drivers can only see the short term stuff. Only those with experience will make it a successful venture. You are right on the maintenance and incentives part though.

Originally Posted by ashis89

[list] Do you know how surge pricing works? How does Uber define the area where surge will work?

Purely depends on the total vehicles in the region and the people asking for cabs. Keeps varying as well throughout the day.

Cab drivers in Hyderabad say that once they go to the airport to drop someone, they are assigned a 'queue number' based on the cars waiting for a return passenger. They have to wait anywhere between 6-10 hrs for their turn to come and get a passenger. Is it true?

Big airports will have a queue system, but it is displayed on the driver's app. It will show how many existing cars are already waiting at the airport parking. Though the figure of 6-8 hrs is highly over exaggerated.

If there are 'n' cabs available in my area and I request for a cab, how are they assigned?

The closest one is assigned to you. You may also get one that is on they way home (home trip / destination trip).

Originally Posted by ninjatalli

Don't think there is any particular reason why; probably the drivers/owners think the rear seat passengers are fine without a belt on.

Thanks ninjatalli! The reason for this is simple - not many customers ask for this, but slowly I've started noticing that rear belts are available in most cars. The sedan ones usually have only the middle lap belt tucked in. Always leave feedback and its conveyed to the driver.

Originally Posted by jetsetgo08

Excellent thread, Blackwasp! Another thread with pure facts and experiences. Glad that your entrepreneurship days have started earlier than most. Off topic, are you still working in the automotive sales?

Thanks a lot. Yeah, my experienced with the auto sales gave me the confidence to go ahead with this.

I no longer work with the car dealership.

Originally Posted by hrman

A lovely thread Blackwasp.
I fully agree with the point of outstation drivers being more hardworking. I didnt know that the attrition is so high and it is difficult to keep a driver for more than 4 months.

Most think that they can go out and earn more. How ever, this is not a fixed income model. Your income varies almost daily and you should have enough cash reserves for at least a month or two to cover your EMIs and other expenses. This is where the quitters go wrong. They see good income in the first month and end up spending all of it, at times even buying things on EMI without any thought to savings and future business.

Also , there are many owners out there who can't find a driver and promise higher salaries. Their logic is with no driver I'm losing all the money, at least with a driver, I can cut my losses. This causes many to quit.

This is because they need to do two airport trips per day and will not be able to do if it is through the app or some such thing. Possibly a long queue thing. Is this true?

This is mostly done by Ola drivers. There is no restriction on the number of trips. If you feel there is a long queue, you are most welcome to move to another location for picking up passengers.

What is the moolah one can expect after all this? Additionally, does the choice of car have to do anything with economics? (Prime Sedan having higher fares and more income etc?)

You can refer to some of my screenshots above for a rough estimate on the income (Do consider higher running per month, extra insurance costs and annual road tax payments). CNG cabs would be the best. The fare difference in Sedan vs hatch is not a big amount. However, SUV demands are also rising - especially for airport drops and all.

Originally Posted by ashis89

His reason was PayTm money takes time to be credited to their accounts and he needed some money.

Just being dishonest. Remember, if you are not on trip on Uber, its a private trip and incase of any issue Uber / Ola won't entertain you. Payments are prompt and are done on a weekly basis.

[Sherlocked]

Thanks for writing this wonderful thread blackswap. Had many insights related to this particular field.

Can you please share the total cost incurred in servicing/maintaining the WagonR all through this 80k kms and counting in just 1.5 years. What all were the warranty replacements and part failures other than the usual wear and tear items. I have seen that majority of drivers abuse the clutch heavily unless they own the car themselves. How has been your experience the way multiple drivers drive your car.

Regards