Ola, Uber face supply squeeze: 24% drivers leave as incentives drop

Most drivers have either moved on for other offline opportunities or quit the profession altogether

Two of the country’s largest taxi-aggregators, Ola and Uber, saw the supply of cabs on their platforms declining to nearly three-fourths in the March quarter of this year. With disgruntled drivers opting out due to a fall in incentives, the total number of cabs they run fell to around 380,000 in January-March from 500,000 in the previous three-month period – a drop of 24 per cent – shows a Livemint report.

The report, citing figures from market research firm RedSeer Consulting, also says that a large number of drivers on Uber and Ola either moved on to explore other offline driving opportunities or quit the profession altogether. Ola and Uber drivers, it is believed, saw their earnings declining by as much as 60 per cent in the absence of incentives provided by the companies.

In Bengaluru and Delhi, the two largest markets for ride-hailing services, drivers have staged multiple protests complaining about falling earnings. While the state transport departments have tried arbitrating talks between the two parties, drivers say no solution has emerged so far.

While employee grievances generally fall in the labour department’s ambit, drivers on Uber and Ola platforms, technically, are not employees of these companies. Instead, they are partners who willingly list their vehicles on these platforms and offer services to the customers brought to them by the companies.

Several drivers and media reports have suggested that Uber and Ola had verbally promised drivers that they could earn up to Rs 1 lakh if they drove for them. Several drivers said they were able to hit targets initially, but their earnings halved as the companies began withdrawing incentives in the past few months.

Bengaluru and Delhi are estimated to have over 100,000 cabs that are listed on either of the two platforms. With incentives dropping, the number of rides on Uber and Ola fell five per cent in the March quarter on a year-on-year basis, show the RedSeer figures.