Recently, the Maharashtra government put forth a set of draft rules for regulating the taxi industry. These rules have been in the works for some time as various taxi-operators (especially in the city of Mumbai) have been demanding “uniform code” for the industry. The chorus for such rules has come from the lower-end (kaali-peeli taxi-wallas and the autorickshaws) and the upper end (radio-taxi operators like Meru and TabCab) as well. And yet, the funniest part is that there is already a stringent set of laws that regulate the functioning of these operators. So why the hell are they asking for more?
Actually, they are not. These taxi stakeholders are demanding something more mundane, something basic. Something that spells as parity in business. The crux for any business to function normally is that all the players in the sector will be treated same. Simple to say that rules and regulations should be the same for all the players. So, what is good for the goose, should be good for the gander. Right? Apparently not, when the gander is a multi-billion ride share MNC that goes by the name of Uber.
In fact, Uber has raised a stink regarding the Maharashtra government’s draft, opposing it with all the muscle that it can muster. The US-based cab aggregator has decried the rules, calling them restrictive and archaic. It even launched a high-octane public petition, seeking the lay citizen to sign-up and fight against the restrictive norms. The petition paints a rather gloomy picture, namely, if the rules are implemented, it “will mean an end to the Uber I know and love today”. Rather than talking just logic, or talking about the facts that are hurting competition, the petition tries to tug the emotional chords, love, shove and the works.
Now that seems to be taking things a tad bit-bit too far, like a Karan Johar movie with Anurag Kashyap dialogues. You see, taxi-riders in Mumbai don’t really love Uber or Ola, but yes they do seem to hate the kaali-peelis and autorickshaw-wallas. After decades and decades of suffering the indifferent and condescending attitude of these monopolistic ruffians, they have finally found deliverance at the hand of these cab aggregators. This welcome shift started with start of Meru in the city, and blossomed with Ola and Uber. To put it rather bluntly, the taxi-riders in the city like the convenience of a no-nonsense service that is way cheaper than the kaali-peelis. I mean Rs. 6 per km is even cheaper than taking your own car out. That is secret behind that “love” that Uber claims it receives. Yet, this incentivised love is usually not monogamous, the denizens will shift to anyone that offers a bigger bonanza. I mean, if there was a cab operator that offered Rs. 3 per km ride, of course, more would ‘love’ it than any Uber or Ola. There’s no emotion in economics? Continue reading …
On Feb 4th, major newspapers in Mumbai carried a fervent (and a rather long one as well) appeal from Meru Cabs, asking the lay public for support, something that went like, we served you now, support us. Saying it in short, the ad talked about how hoodlum practices had forced the company to stop its operation and how in spite of almost all the drivers wishing to return to work, they were not let to, by a “handful of people with ulterior motives”. At the end, there was a business plea, to let a corporation carry out its business unhindered by political machinations.
For many of us in Mumbai, the current Meru fracas is certainly not a new one. Over the past year or two, it has become a regular affair. Over some trifle issue or the other, the olive-green taxis will be off the road, and after some reconciliation they will be back. Only for the same cycle to repeat all over again. In fact, the ad itself mentioned that the company has suffered such “strikes” 6 times in the past two years. None of the competitors, the Mega, the Easy or the Tabs, have faced such issues. So, what exactly is the company doing so wrong that it’s facing such backlash again and again?
Curiosity finally, got the better of me, and I started Googling on the subject and asking my friends in the industry to find out how and why things had come to such a pass. And here’s how the story unfolded. Starting off in this very city of Mumbai in 2007, Meru today is India’s largest radio taxi operator and world’s 3rd largest company, operating some 5500 cabs in metros like Delhi, Bangalore and Hyderabad, in addition to Mumbai. Statistically, Meru serves more than a million passengers a month; executing over 20,000 trips on a daily basis (it even holds a Limca Book of Records for the same).
Now, just as Redmond is synonymous with Microsoft or Atlanta with Coca-Cola, or even closer home how Bangalore is synonymous with Infosys, Mumbai and Meru have an intrinsic connection. In fact, it should be a matter of pride for all of us that in a short course of half-dozen years, a start-up from the city attained such success that it was even featured in WSJ or even as a Wharton case-study. Meru’s success is symbolic of Mumbai’s entrepreneurial acumen, where if you have a great idea and a determined will nothing can come in the way to success. Except possibly for politically-aligned trade unions.
Time for flashback. When Meru started operations back in 2007, we Mumbaikars were completely at the mercy of the city cabs (referred locally as kaali-peeli). Hyper-inflated bills, rowdy behaviour, rash driving, and others were all the calling cards of the kaali-peeli. Commuters were helpless in front of these cab-wallahs, who ran according to a writ of their own. In this mire, appears Meru, a professional run-taxi operator, that delivers a swanky sedan at your door, with a civil driver and a mechanism to ensure no over-charging. While over the years, Meru added a lot many features to their cabs, like web-booking, credit-card payment, etc., the earlier 3 were its only USP. Continue reading …