Money or Customer Service: Why Uber/Ola Drivers Cancel Your Rides

“Ola!” and “Uber” do not mean Hello and Outstanding anymore in Indian vocabulary. These words have become synonymous with ride-hailing services or app taxis. For audiences outside of India, Ola is much similar to Lyft and competes with Uber (and many others) in the ride-hailing service space. Besides cab rides, these companies have also turned their attention to offering 2-wheeler rides to delivery services similar to dabbawala. You can also avail tuk-tuk or auto rickshaw as it is locally called using these services.

Unlike in the Americas(at least most of the USA and Canada), ride-hailing services in India cannot employ everyone who owns a car. It is highly regulated in India and requires you to have a commercial license to operate with Uber and Ola. The cars should be registered with RTO otherwise known as the Regional transport office and in some cases the state government to be a part of the ride-hailing ecosystem. Tuk-Tuk locally referred to as auto, is a very popular option among riders.

Innovation is taking two things that exist and putting them together in a new way.

In 2017, my mom who was never comfortable with e-commerce or apps in general was at ease in using Ola and Uber. This was the inspiration to write this blog. Switch to 2022, booking a cab/auto on uber and ola was a nightmare. The rides were regularly cancelled for varying reasons. Some scenarios that I encountered were

  1. Drivers would call ask for the destination and cancel.
  2. Drivers would not answer the call of the riders
  3. Drivers demanded more money than what was shown in the app.
  4. Drivers sometimes had a callous attitude towards the customers.

The customer or the product manager in me wanted to get to know a little bit more and understand why the rides were cancelled. The ride cancellations did not burn my pockets but also resulted in losing valuable time that I could have enjoyed. I would have probably taken close to 50+ rides during my 3-week stay and used this as an opportunity to understand the problem of the drivers (Not a great sample size given India’s population but still significant in my view). The Ola/ Uber drivers were pretty vocal in showing their displeasure with the services.

  1. Too high a commission: Uber and Ola charge the drivers a commission based on the type of car and the rides. The drivers in India claimed that the charges of 30% commission are unfair. Some drivers were honest enough to share the amount they received for the ride and their claims were not incorrect. Transparency in how the commissions are charged could help the drivers understand it better.
  2. No Incentives: Each company goes through different phases of development in their journey. During their acquisition phase, Ola and Uber showered their customers and drivers with various incentives. I remember there was a time in which drivers received INR 1000 for 5 or so rides. These days the drivers complain that they do not receive any such good incentive that motivates them to ride.
  3. Not fairly compensated: Some drivers would cancel my ride saying that the fare for the ride is too low. I would then negotiate with the rider and tell him/her that i would pay a part extra in cash. Even then some rides were cancelled. Some of friends took it to the other extreme, they would ask the driver the to cancel the ride but would still request the driver to pick up them and pay them in cash. The drivers also complained that the inflation and the volatile gasoline rates are not taken into consideration. Ever fluctuating price of petrol is also another major concern.
  4. Delay in settlement: One puzzling question that most drivers asked me was “Are you paying me by cash or Ola/Uber money?”. The moment we mention wallet money, there is a frown amongst the drivers. The drivers will either request me to pay by cash or cancel without any notice. The issue that the drivers had with the ola money or uber money was the turnaround time was sometimes 2+weeks which for a daily wager is a bummer. Most drivers need to spend a part of their daily earnings on petrol(gas).

Uber and Ola have been pioneers in ride-hailing services and have been a step ahead in innovations and acquisitions. But this trend according to me is a serious concern and a product gap that the services need to address sooner. So how do you think they can arrest this decline? Feel free to drop in your comments and in 2 weeks let us discuss some solutions in my next blog.

16 thoughts on “Money or Customer Service: Why Uber/Ola Drivers Cancel Your Rides

  1. Very well written Karthic. I faced the same situation in hyd. but I guess wfh is the main reason behind this, as these companies have lost lot of daily customers. Also in lockdown, pandemic many drivers have moved out and settled in other alternative jobs..!!

    1. Thanks Gouthami. Pandemic causing a wreck is an interesting line of thought but the user behaviour needs to be more closely observed for them to thrive.

  2. Practical observations. Well thought written.
    I will give my inputs when I visit India this year end.

  3. When we visited Montreal, I realized that Uber drivers don’t know the location of the destination until they pick us up. Our place was a little far and a few drivers weren’t so happy with it..but yet chose to drive without a choice. Not sure if this can ever be implemented in India. It may be done based on KMs and preferred regions and location conditions for drivers. Ofcourse declining will come with a penalty if this was to be implemented.

  4. Detailed well-thought out post..
    I definitely faced this problem of getting our rides canceled during our recent visit to India.. and it was frustrating to say the least.. In addition, there would be rides that didn’t update and canceling from our side wouldn’t go through so the drivers would show up after we were in another vehicle..

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