The India taxi war turns fiery - Uber sues Ola for $7.5 million

The past month has seen the leaders of the Indian taxi aggregator market take their fight to the courts. Uber accused Ola of creating fake accounts to sabotage the former. The latest twist in the case is that Uber has sued Ola for $7.5 million (about Rs 50 Cr) alleging that Ola created fake accounts to make bookings on Uber only to cancel it once the drivers accepted.

Ongoing battle

A few weeks ago, Uber said in a petition filed in the Delhi High Court that drivers wait for 10-15 minutes before cancelling the trip resulting in Uber having to bear the cancellation charges. If the allegations are true, Uber would not only have had unsatisfied customers but also monetary losses. Every time a ride is cancelled, the platform has to pay the drivers a certain amount.

Ola, according to the allegations, created about 94,000 fake user accounts on Uber, and made more than 405,000 false bookings, Reuters has reported. Apparently, Uber set up an internal team to investigate the locations and IP addresses of the users who had booked and cancelled rides. “In court documents, Uber says it found 660 accounts used to make troublesome bookings came from a building housing Ola’s office in the western city of Pune. Most of the rest were created near Ola’s office in the tech hub of Bengaluru, it said. In the court filings, according to the Reuters report, Uber said more than 23,000 of its drivers quit due to “illegal and wrongful interference” between September 2015 and February 2016.

Earlier this month, Chandigarh-based autorickshaw aggregator Jugnoo had made similar allegations against Ola. Ola has denied all accusations.

What next?

The Ola-Uber war has been going on for many months now,, but until now was in terms of claims on market share to their prices. A few months ago, Ola had also filed a complaint against Uber in Delhi, where CNG cabs are mandatory. Ola had shifted its entire fleet to CNG cabs last year.

Although Ola has previously claimed to have had 65 percent of market share, Uber is catching up fast, and Ola recently launched Ola Micro to get an edge over its US-based competitor.

The cab aggregators’ headaches are beyond their competition with each other. Both have been in trouble for flouting laws passed by State governments with regard to fares, surge pricing, and hundreds of their cabs have been booked for violations in recent days.

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