Friday, August 19, 2016

Surge pricing of app based cab companies

Today's post is regarding surge pricing of app based cab companies UBER and OLA. The app based companies increase their prices a demand increases. Today I was discussing with some of my friends that cab drivers at Airport and Railway station charge 600 rupee for a ride which should have been 350 rupee this is nothing but blackmailing. When I asked them about surge pricing of app based cab companies they said that it is demand and supply economics and customer had option of going to another alternative if he/she does not agree with surge pricing. I don't see any difference between surge pricing and taxi drivers asking for extra money at Airport and Railway Stations. It is also surge because of demand and supply economics. Why should it be called blackmailing if some small group of taxi drivers do it and demand and supply economics if a 1000 crore company do it?

I do know of a case when a passenger paid 5000 rupee for a ride to Airport in UBER cab at the time of even and odd scheme in Delhi, the surge was 20 times at that time. I heard about this on FM radio channel, I don't know why other people don't remember it. Had it been a normal taxi driver everyone would have been talking about ending this blackmailing of taxi divers but since it was a 1000 crore company it is being called free market economics. Why?

As far as I am concerned I think that there should be a control on free market so that service provider don't exploit consumer by overcharging. So there should be a maximum price for any product offered to consumer. Free market is about getting more consumer by offering cheaper products and making profit by providing service to more consumers and not by blackmailing customer and selling product at exorbitantly high price and making more profit by that.  

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