Neeraj Gupta, founder and managing director of Meru Cab Co. Pvt. Ltd, does not mince words when he speaks about the remuneration model for drivers at rivals Ola Cabs and Uber. “We don’t have any of these false incentives and keep on making false promises and say after one month that we have withdrawn these,” Gupta tells Fortune India. Whatever incentives Ola Cabs and Uber had doled out were not sustainable and now that has started to backfire, added Gupta.

Fortune India had earlier reported that driver incomes have dropped by at least 50% to ₹ 50,000 per month lately due to the maintenance expenses of cars, refunds for ride cancellations, and soaring fuel prices. A few drivers had also purchased more than one car to make the most of Ola and Uber incentives. Now, as incentives have dried up, car owners who took loans to do that are selling off the extra cars as they are not able to pay the equated monthly instalments.

Drivers of Ola and Uber in Mumbai had entered the second phase of strike on November 17 seeking higher pay, which was suspended on November 19 after Maharashtra chief minister Devendra Fadnavis promised a meeting with the companies and the drivers after the winter session of the assembly, which ends on November 30. Earlier, the drivers had gone on a 13-day strike starting October 22.

Meru Cabs operated with around 2,000 cabs in Mumbai during 2007-2018. It had increased the number of cabs to 5,000 in between but rolled back to the number to remain closer to profitability. As Gupta says, “We decided to run a small business but a profitable business.”

Protests by Ola and Uber drivers are benefitting Meru. In the past one month alone, it has added over 10,000 new cabs in Mumbai with nearly 7,000 drivers active on the Meru Cab app on a regular basis. With better availability of drivers, the trip requests have gone up by four-five times, Gupta said. In March this year, Meru Cabs launched a marketplace model wherein drivers can bid fares within a defined range on their partner app. Customers can choose from a list of up to 10 nearby cabs and select a ride based on the fare amount, expected time of arrival, car model and driver rating. While the upper cap will be as per government-stipulated fares, the lower price range is ₹10 per km. So, in the afternoon, when the demand is less, drivers can keep the price lower. In the evening and morning hours, when demand is high, the drivers can bid for a more competitive fare at the higher end.

Meru Cabs marketplace

Ola, Uber drivers’ strike a ‘blessing in disguise’: Meru