Chennai – the capital city of Tamil Nadu in southeastern India – recently implemented new fare regulations in its auto-rickshaw sector for the first time since 2007. In 2010, the Tamil Nadu government lifted a freeze on issuing permits, which decreased the permit cost and led to a sudden growth in the supply of auto-rickshaws. Lifting the freeze was a direct response to a shortage in supply that was thought to lead to high fares.

Unfortunately, increasing the number of auto-rickshaws throughout the city did little to combat high prices – exorbitant passenger fares remained the norm because the base fare for a trip was last set in 2007. Since then, fuel prices have risen from 47 Rupees (USD$.76) to over 70 Rupees (USD$1.14) per liter, making auto-rickshaws significantly more expensive to operate. While the September 2013 fare reform has been instrumental to addressing this long-standing issue in Chennai, the city must invest in professional management solutions coupled with strategic and forward-thinking technology advancements to truly achieve high-quality auto-rickshaw service.

Can GPS fare meters restore the reputation of Chennai’s auto-rickshaws?

In addition to regulating permits and a standard fare for auto-rickshaws, Tamil Nadu’s government has established a committee to consider introducing GPS fare meters and printers to auto-rickshaws in Chennai. The GPS meters are intended to serve a two-fold purpose: first, they would standardize auto-rickshaw fares by calculating price based on distance traveled. Second, they would enable the government to monitor auto-rickshaw operations in the city through a central control room.

The three main problems passengers face with auto-rickshaws in Chennai are ride refusals, overcharging, and tampered meters – issues that stem from the unorganized nature of Chennai’s auto-rickshaw sector. Anyone who has ridden in a Chennai auto-rickshaw has probably heard one of the following comments from drivers: “Please give me 20 Rupees on top of the meter fare,” or, “I won’t find a ride where you want to go, so pay me 50 more Rupees.” Whatever technology interventions are chosen by the selection committee must address these hurdles to improve the quality of service for passengers.

Professional management is the key to high-quality auto-rickshaw service

Given the informal organization of Chennai’s auto-rickshaws, promoting professional management of auto-rickshaw services should be the government’s highest priority to achieve high-quality auto-rickshaw service in the city. The implementation of technology solutions and other initiatives like effective monitoring and enforcement should occur within the larger umbrella of promoting a professionally operated auto-rickshaw service in Chennai.

Fleet auto-rickshaw services that are professionally managed through public-private partnerships have been successful in cities like Rajkot and Surat and should be considered an opportunity for Chennai to leverage private sector expertise and efficiencies, while addressing the government’s funding gap. Fleet services can provide benefits such as stronger brand image, improved operational efficiencies, higher quality service for passengers, and increased earnings for drivers. Professionally managed auto-rickshaw systems can also provide better driver training and mitigate practices like refusals, overcharging, and tampering with meters.

There are many different business models for fleet service implementation, including non-profit, cooperative, and for-profit businesses, so it’s important to assess which model is appropriate based on local context. In Chennai, fleet services such as Namma Auto and Auto Raja have already demonstrated that private sector driven initiatives can stimulate better service in the auto-rickshaw sector; the next step is for government policies and regulations to enable these business models to scale-up and expand their impacts to a citywide level.

Recommendations for technology implementation and monitoring

The government’s initiative to integrate technology like GPS meters into auto-rickshaws is a welcome step towards improving Chennai’s auto-rickshaw service. In order to ensure the best results, technology improvements should be implemented within a larger reorganization of the sector into fleet auto-rickshaw services. Through the introduction of fleet services, the cost of installing GPS meters and printers in auto-rickshaws can be borne by private enterprises, without unduly placing the burden on drivers. For example, the government could make installing GPS meters and printers, the minimum qualification for private entities aiming to provide fleet auto-rickshaw services in Chennai.

Tamil Nadu’s government could also subsidize the capital cost of GPS devices with funds available from the federal government, since the recently launched Global Environment Facility-5 (GEF5) under  the Ministry of Urban Development has proposed to make dedicated funding available for cities implementing technology reforms in their auto-rickshaw services.

In a city where auto-rickshaws carry over 1.5 million passengers a day, the role of the auto-rickshaw as an intermediate form of public transport cannot be understated. Appropriate regulation and reform of this sector has the potential to make auto-rickshaws more sustainable and beneficial for passengers, drivers, and the city as a whole.