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Ola faces CCI probe for predatory loss-leader pricing of cab fares

Ola Cabs is facing a complaint in the Competition Commission of India (CCI) for spending more money on discounts and incentives on customers and drivers compared to the revenue it is earning, reported the Business Standard.

The CCI directed its director general to conduct an investigation on Ola owner ANI Technologies on the complaint of Chennai-based Fast Track Call Cab against it for predatory pricing and unfair trade practices under the Competition Act 2002.

Noting a preliminary finding of abuse of dominant position against ANI the Commission observed that it is “spending around Rs 574 [per trip] while earning an average revenue of Rs 344 leading to a direct loss of Rs 230 per trip”.

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