Development of a fare structure for the three wheelers

Abstract

Three wheelers have a significant contribution towards the road transportation as a popular para-transit mode in the country. Though three wheeler taxi provides valuable services, it is not appreciated at all. Only negative aspects are highlighted. Its existence and operation fail to get the credits from the society. Three wheeler transport services is unregulated at present and is mainly criticized for its “unfair” fare structure. Many three-wheeler users view that they are often exploited by drivers who over-state distance and charge higher fares. It is also observed that the fares are generally inconsistent and may vary from operator to operator, in addition to the distance travelled and journey time. Further, three wheeler meters are calibrated arbitrarily by the operators. Absence of a proper fare structure for three wheelers causes inconvenience to both operators and passengers. Therefore development of a fare structure would lead to minimization of imbalances and inefficiency in the service under prevailing fare structures. At present, passengers are charged with a minimum fee of Rs. 50 for the first kilometer and henceforth each kilometer is charged at a rate of Rs. 40 per km. There is no systematic procedure to charge for two way trips and waiting time. This study is an attempt to examine the price irregularities and explore the cost recovery in three-wheeler transport services and thereby develop a systematic fare structure for Three-Wheelers based on both passenger and Three-Wheeler drivers’ perspectives. A fare structure should be transparent, simple and understandable by each party to be effective and fare structure is the instrument to recover cost and it acts as the communicator between the operator and the passenger of the taxi service. After considering the present operational cost and cost recovery of a three wheeler, including the profit mark-up, a new fares structure is proposed considering all stakeholder requirements and expectations. It is shown that the three wheeler is best for shorter distances (last mile connectivity) and not efficient for longer distances. Hence, three wheelers should not be encouraged for longer distances travelas public bus transport and the van service are more efficient for longer distances.