While incentives and subsidies are available and common for the suppliers and consumers of Uber/Ola and battery rickshaws, autorickshaws have no such advantages. What impact has this had on auto drivers’ incomes?
The Uber office in Delhi. Credit: Reuters/Anindito Mukherjee
Delhi, one of India’s most populated cities, has seen major developments in the last decade. The city’s transport sector, in particular, has undergone crucial technological transformations – from the rapid expansion of Delhi Metro to the introduction of battery-operated rickshaws to smartphone application-based taxis like Ola and Uber that can be accessed in a click.
Amidst all this change, the autorickshaw, a traditional vehicle, has not kept up by most measures and drivers are left with few options for future restructuring. However, autorickshaws continue to remain a common sight both on the streets of New Delhi and in most major cities and towns across India.
The drivers of these vehicles usually come from the economically weaker sections of India’s urban population. Often working both the early morning and graveyard shifts, many of them are also sole breadwinners for their families.
What exactly has been the impact of Uber, Ola and smaller battery rickshaws on the work of traditional autorickshaws? Our study – a survey-questionnaire conducted once in 2015 and again in 2017 – looks at examining the change in the economic situation of autorickshaw drivers in the national capital over the last three years.
‘Three wheeler (Passenger)’ vehicles – the name by which the Delhi government’s transport department recognises autorickshaws – are 1,04,969 in number, constituting 1.04% of the total vehicles registered up to 2016. Not shockingly, and due to the introduction of Ola and Uber taxis, the number of registered cabs till 2016 has exceeded that of autorickshaws, constituting 1.10% of the total vehicles registered at same point in time.
The phenomenon of Uber and Ola discounting has been well detailed, even though exact specifics when it comes to cities and localities are largely unknown.
In Delhi – when the travelling distance is short (less than four km), or when one is travelling within a particular area or from a metro station or bus stand – battery rickshaws or e-rickshaws, as they are popularly known, are a cheap and comfortable option. They are convenient because of their frequency. They also don’t cause air pollution – recognising this fact, the Delhi government has also announced a subsidy of Rs 30,000 on its purchase.
Therefore, while incentives and subsidies are available and common for the suppliers and consumers of Uber/Ola and battery rickshaws, traditional autorickshaws have no such advantages. Our findings and even government numbers show that the metre charges are same, or in other words have not changed, in our reference period. It is Rs 25 for the first two km (upon starting the metre) and thereafter Rs 8 per km for every additional km.
As can be observed from the table below, the average per day number of sawaris or rides in 2015 was 14 and in 2017, with a plunge of around 57%, it came down to six. Similarly, the average income per day in 2015 was Rs 1,013 and it has fallen down to Rs 579, denoting a fall of 42%.
The decline in average trips per day and average income per day fits well with the corresponding increase in the number of registered cabs and e-rickshaws between 2015 and 2017. Uber and Ola cabs are more comfortable, being air-conditioned, while battery rickshaws score higher on being more frequent and charging nearly the same rate as an autorickshaw for the same distance.
According to Delhi government statistics, in 2015-16, the total number of e-rickshaws registered was 8,557. In 2016-17, this saw a huge jump, with 20,566 more e-rickshaws being registered. In the same reference period, around 60,000 new motor cabs were registered.
However, it isn’t just the increase in the number of Uber and Ola cabs that is causing the decline in income for autowallahs, but also the prices that they are charging.
The table above has been created by using the Ola Cab fare chart, Uber fare estimator and Delhi government auto fare chart. This tells us the actual prices of a normal Ola taxi, a normal Uber Taxi, an UberPool ride and an autorickshaw (if it goes strictly by the metre). The table also has a column for time taken during the distance because Ola and Uber (not pool/share, because it is a flat price taxi) charge Rs 1.50 and Rs 1.58 respectively per minute.
Also read: Why the Problems of Uber, Ola Drivers Are Far From Over
When we consider the price of a ten km ride in the national capital, UberPool is cheaper and more convenient (because of the AC, comfortable sitting) than an auto. A rational passenger might opt for Uber Go or Ola Micro if she needs to book the whole cab for three or four people.
An interesting feature enters into our analysis if we divide the income of an individual driver by the number of sawaris he gets in the same period and calculate the average for all 171 samples. This statistic can be called ‘income per sawari’, which is basically the average of individual incomes divided by the corresponding number of sawaris.
What is interesting about this ‘income per sawari’ is that it has increased in our reference period. It means that the amount an auto driver was getting per passenger (on average) has increased. This, however, does not necessarily translate to increase in overall income. All that can be inferred at the moment is that the decline in sawaris is more than the decline in income, which is consistent with the first two tables.
One possible reason for the increase in ‘income per sawari’ – especially when the metre charges regulated by the government have not changed in our reference period – could be that more auto drivers are not going by the metre. A case study supports this point that many autorickshaw drivers do not use meter.
A cyclist passes by a queue of auto-rickshaws waiting to fill their tanks at station selling compressed natural gas in New Delhi April 2, 2001. Credit: Reuters
Other findings and their relation with ‘income per sawari’
In examining the Indian autorickshaw economy and its economic fortunes, a crucial issue is the prevalence of ownership. We found that 73% of our total respondents own their auto, while 27% of them rent the vehicle.
Should an owned and rented auto present different earning potentials? The table below sheds some light. Drivers who own the autorickshaw on average earn more money, undertake more trips but rack up less income per sawari compared to those who have it on rent. As we have seen above, more income per sawari should mostly mean that the driver is not going by the metre and instead negotiates the fare with the passengers, or in other words is charging more per passenger on average.
We observed that drivers who have a rented auto tend to charge more per passenger on average. This hike in price results in fewer sawaris and ultimately less income.
We should also observe that interpretation of both rows of the table is not binary. That is, we are not saying that drivers who own an auto go by the metre or they don’t charge their passengers more. They may or may not, but if they do so then it appears less than those who have a rented auto.
We also asked the auto drivers what they believe has affected them the most (economically) over the last few years. We gave them three options – Ola/Uber, battery rickshaw and metro. Eighty-five percent of our respondents are feeling affected by Ola and Uber as far as their earnings are concerned. Eight percent of them ascribe their adverse economic condition in the last few years to battery rickshaws, while 7% are not sure. Nobody blames the Delhi metro.
“Short distance ones by battery rickshaw and long distance ones by Ola and Uber. Almost all of our sawari have been taken away,” said Raj Kumar, an auto driver at Delhi railway station.
Also read: Getting Ola and Uber Drivers Out of the Regulatory Grey Zone
A follow-up question centred around whether they wished to leave the autorickshaw-driving occupation and perhaps drive instead for Ola/Uber or a battery rickshaws. Eighty-eight percent of the survey’s respondents stated that they don’t want to stop being an auto driver for either of the given options. Among the reasons given, the major ones that stood out were that the vehicle they had was on EMI or monthly instalments; only after clearing their debt could they think about shifting to a cab or battery rickshaw. In interviews, drivers also bring up the recent Ola and Uber driver strikes and stated that the problems they face will continue even if they change the vehicle that they drive. Another crucial reason for sticking with an auto is that many said they either don’t own a smartphone or are not familiar with operating smartphones.
The arguments against shifting to a battery rickshaw are also interesting. One auto driver put it this way: “Many of my friends belong to the rural part of different states. They have come to Delhi to earn by driving an auto and this occupation is known to everybody in their respective villages. Now it will be a big embarrassment for them and their family in the village if they switch to battery rickshaw. A rickshaw is lower than an auto in terms of status.”
Eight percent of respondents wish to stop being an auto driver and start driving Ola/Uber and 4% are even thinking of a battery rickshaw.
If they don’t want to change occupations, what do they plan on doing in the face of less income? This question becomes more relevant if we go back to the first two tables. This is an important question in the coming years, one that will shape Delhi’s transportation market.
An autorickshaw on Delhi’s Rajpath. Credit: generalising/Flickr CC BY-SA 2.0
Some of our questions sought to investigate whether Delhi’s autorickshaw drivers had applied for credit over the last few years. After all, the phenomena of bad autorickshaw economics, while acutely felt now, may have appeared in varying intensities over the last 15 years. Questions centred around whether the drivers had taken credit and if they had, follow-up questions were aimed at ascertaining for what purpose. Was it productive (buying an auto or tractor) or unproductive (buying a TV or taking out a loan for a child’s marriage)?
Of the respondents, 64.12% reported that they had not applied for or received any form of credit even though they have a bank account. Of the rest, 19.41% of drivers had taken credit for productive purposes. A significantly less number of respondents – only 2.35% – had taken credit for an unproductive purpose while 10.59% of respondents reported that they don’t have a bank account, which is a basic requirement for taking a loan from the organised financial sector.
Although autorickshaws continue to be an important niche within Delhi’s transportation sector, the mode of transport as a whole has fallen behind. Though incomes have fallen, it is perhaps curious that a majority of respondents indicated that they don’t want to shift occupations within the mobility sector or apply for credit to start a business.
At the moment, it appears that higher profit or better days can be revived either through recapturing market share (the certainty of which currently appears to depend more on the success of Ola and Uber rather than anything Delhi’s autorickshaws plan on doing) or by reducing competition within the autorickshaw market; which could happen if drivers switch occupations or leave Delhi and go back to their hometowns and villages.
Notes on methodology
Our survey covered three major railway stations of Delhi (in terms of the number of platforms) and all the three ISBTs in the union territory. The railway stations were the ones at New Delhi, Delhi and Hazrat Nizamuddin, and the ISBTs were the Maharana Pratap ISBT at Kashmere Gate, Swami Vivekanand ISBT at Anand Vihar and Vir Hakikat Rai ISBT at Sarai Kale Khan. We collected data from six auto stands by interviewing roughly three drivers, more or less evenly spaced out over the stands. Our sample size was 171.
For the interview, we used a simple questionnaire that included carefully-worded questions on the following issues, among others: number of passengers (sawari) per day in the year 2015 and the same in 2017, income per day in 2015 and in 2017. We also asked if they own the vehicle or not and what affected them the most, and whether they wish to drive Ola/Uber or battery rickshaw if they get a chance. We spoke to some Ola/Uber drivers as well.
The year 2015 was arbitrarily chosen because both battery rickshaw and Ola/Uber were less in number in those days. We could have chosen 2014 as well. The purpose for asking in terms of years like 2015 and 2017 was to minimise the effect of resistance that auto drivers would have shown in their responses if we were to ask about before Ola/Uber and after Ola/Uber.
Mohd Umair Khan is with Aligarh Muslim University.