6 ms·
Uber Cuts Fares in 48 Cities, Raising Some Concern Among Drivers
- deleted 12y ago[deleted]
- hack_edu 12y agoSomething tells me there's a lot more Surge Pricing in our futures. And just when you thought the modifiers were high enough, or that surge hours already have become any-waking-hours... Rather than the bait and switch, why not just raise the price rather than feign at lowering it? Kill the lie that the Surge Pricing brand has become. Just be honest.
- collyw 12y ago"How big data will improve our lives".
- travisp 12y agoThis must depend on the city or your typical usage. I'm not a daily Uber user here in NYC (I commute by subway as most sane people do), but I'm not an infrequent user either (particularly on weekends or evenings with my family). I haven't paid surge since February 2014 (apparently on Valentine's Day), and I can't remember the last time I saw surge pricing, although it looks like twice I paid more and used regular Uber instead of UberX because there weren't enough UberXs available and I was in a hurry for appointments. I don't see any reason to see surge pricing as "bait and switch," although I'd be open to seeing some actual data that backs this up.
- bradleyankrom 12y agoI don't see it as bait-and-switch, either. Uber makes it clear when the ride you're considering will be subject to surge pricing, and it's very easy to abandon the reservation at that stage. I can't think of a time (in NYC) that I've seen surge pricing and been surprised, it's always been during inclement weather or peak times (e.g., Valentine's Day, New Year's Eve).
- smackfu 12y agoYeah, I've seen what happens to taxis when there is no surge pricing. The dispatchers don't even pick up the phone if you call for a pickup, because there's enough business that they don't want to waste a taxi's time driving to pick you up. Not exactly an improvement.
- davewritescode 12y agoI would be happy to pay more, Uber is already very cheap but I've noticed the quality of drivers and cars has gone down lately. That, or create another service tier like Uber XL but for better cars instead of bigger cars.
- paraserv 12y agoThe types of Uber cars available varies depending on the city. If available, choose BLACK CAR if you want a better car. In NYC we have uberT, uberX and BLACK CAR (and sometimes RUSH, for deliveries). Inside those major categories are subs; uberX has uberX, uberXL, CAR SEAT. BLACK CAR has BLACK CAR and SUV.
- smackfu 12y agoI think people just want a decent car, not a luxury car. A $20k car from the last five years is perfectly sufficient. Uber Black is overkill for them, and the price is around 2.5x of UberX.
- theorique 12y agoAlso, in a lot of cases, I find that the customer gets upgraded anyway (at least in off-peak times). Many, many times I have ordered a regular "black car", and been picked up by a big SUV (Escalade or Suburban). Likewise, a lot of times I have ordered Uber X and been picked up by a luxury car and sometimes an SUV (Audi Q5, etc).
- smackfu 12y agoYeah, we did UberX in Seattle and got picked up by a BMW 5-series. I don't think it was Black, but certainly better than expected.
- paraserv 12y agoTrue--while most Uber vehicles are black, it's not a requirement according to a few drivers I've queried. The BLACK category indicates a luxury vehicle for which a BMW 5 would certainly qualify.
- deleted 12y ago[deleted]
- magoon 12y agoWhen gasoline is down 30% or more, those savings should go towards growth and competitive pricing. Uber seems to understand this, but the drivers complain. My how things always seem to come full circle -- before we know it, Ubers will be rude, yapping on their phone in unknown languages, and the cars will have torn upholstery and reek of incense.
- deleted 12y ago[deleted]
- chimeracoder 12y ago> before we know it, Ubers will be rude, yapping on their phone in unknown languages, and the cars will have torn upholstery and reek of incense I understand that you mean to say that you expect the quality of Uber rides to drop, but can you do so in a way that doesn't draw upon negative stereotypes of other ethnicities?
- theg2 12y agoI don't think it has to do with ethnicity as it does with the experience of every regular cab I've ever gotten into.
- freehunter 12y agoIt's not really a stereotype if you're just accurately describing the inside of a cab (and not even mentioning any other ethnicity).
- yedava 12y agoI suppose then English is an 'unknown' language and Americans as a rule burn incense?
- freehunter 12y agoCan you be stereotypical of every non-American culture at the same time with one phrase?
- golemotron 12y agoThere is nothing that prevents Uber/Lyft from being a race to the bottom re driver revenue. I think that should've been obvious to anyone looking at the model from the beginning. One of the first questions is to ask about a business is whether there are any barriers to competition. In the case of Uber or Lyft, they have network effects but the drivers themselves have no barrier. Years ago some Subway franchisees sued Subway because they were selling franchises right across the street from existing franchises. Same issue. There will always be more drivers, Uber/Lyft control the rate, so no limit to how far drivers can be squeezed.
- freehunter 12y agoBut one of the biggest complaints about taxis is the artificial scarcity of medallions driving up prices. How would Uber creating an artificial scarcity of drivers (to drive up prices) be any different?
- pfortuny 12y agoThe parent did not ask for it, he simply states the obvious: no barrier to competition means difficult business, no more.
- freehunter 12y agoI wasn't posing the question to challenge him, just as an addition to his comment.
- pfortuny 12y agoI misunderstood your comment then, sorry about that.
- unreal37 12y agoI once talked to a taxi driver (who didn't own the medallion), who said he paid the owner $1,500 per month to drive for him. Plus the cost of his car, gas, and high insurance. He had to earn $3,000 per month just to break even. Taxi drivers never made a lot of money, even in the old system. But at least the system protected them to a degree by limiting competition. Now there is no protection. It's a free market. Anyone with a Toyota Yaris can fire up Uber-X and compete during the busy couple of hours of the night. It will be a race to the bottom for driver incomes, for sure.
- abakker 12y agoLower gas prices in most UberX cars is barely going to matter. They really do need to replace casual car use/ownership, but I think rather than continually drop effective wages for their drivers, they need to focus on how good a deal it already is. (compare to mileage on your car, fuel, parking time, parking cost, Parking location)
- vinceguidry 12y agoExcept it's really not that good of a deal in most places Uber is active. There's no amount of spin that will make spending $40+ on transportation to and from the bar be less than parking fees, gas, and mileage. All that totals up to $20 max. If I'm bar-hopping, forget it. You're cutting out certain sources of overhead but introducing others, specifically a driver and the organization managing that driver. Uber has to find a way to cut costs to the bone because humans are more expensive than machines and resources and that's not going to change anytime soon. It's even worse for commuting, because you'd have to be working for a real a-hole if you're paying parking fees at work. Uber estimates that it costs $16-22 one way for my commute. $32-40 is pretty steep to get to and from work. They have a long way to go before I'd be able to replace my car with Uber.
- ghaff 12y ago>because you'd have to be working for a real a-hole if you're paying parking fees at work It depends. It's pretty common in a large city not to have parking included. (And, in fact, I know of at least one city that doesn't allow employers to provide free parking.) But your basic point is entirely correct. Driving or taking commuter rail into a large city may cost $20 per day or so but then Uber/taxi is going to cost more as well. For the vast majority of people, you can't replace a personal car with a taxi for anything like the same price. It's only practical at the margins; i.e. you only marginally need a car anyway.
- aetherson 12y agoIt's a bad deal on those metrics outside of some very small cases (basically, ones where you'd otherwise park for a long time in an expensive location). And you're paying the fuel and milage costs any way you look at it (in fact, you're paying for more fuel/milage, since the driver has to drive to you). I don't understand why this error constantly crops up -- surely everyone understands that car fairies don't come down from the sky and put gasoline into the tanks of UberX cars. You're the one paying for the ride, so you're paying for the gas. The fact that you aren't physically present when the gas gets put into the tank of the car has no effect on it.
- smackfu 12y agoIn a 30 MPG car, the drop in gas from $3 to $2 is a 3 cent difference per mile. UberX charges from $1.50 to $2 or so per mile. So gas price seems like a red herring to me.
- jellicle 12y agoIf Uber drivers haven't figured out yet that the company's goals are to create a huge workforce of barely-employed "contractors" who each earn just barely enough to survive (probably have negative earnings in the long run, when car depreciation is factored in - Uber knows that humans undervalue the car depreciation and don't take it into account when figuring their profits and losses), then I don't know what to tell them. They should figure that out.
- golemotron 12y agoI think calling it a 'goal' overstates it. It's a pure consequence of the model and I don't think it's possible to change because there is an Uber/Lyft duopoly now. Because they are in competition with each other, either can profit if the other incurs the cost of being more driver-friendly. Yes, there is competition for drivers and drivers influence quality. Honestly, I think that the only way these two players survive is to stratify their services: high end with good drivers vs. the college kid with a junker full of empty pizza boxes.
- username223 12y agoYep. Uber apparently pays $1.50 per mile before its various surcharges [1], while the standard reimbursement rate for depreciation is $0.575 [2]. So employees, er, I mean "contractors" make less than $1/mi. Include the mileage driving between fares and the time waiting for a new fare, and I'll bet many drivers are below minimum wage. But that's what "disruption" looks like. [1] http://drivingforuber.com/?page_id=20 http://drivingforuber.com/?page_id=20 [2] http://www.gsa.gov/portal/content/100715 http://www.gsa.gov/portal/content/100715
- res0nat0r 12y agoMost commenting here didn't read or take into account this part: > To reassure drivers worried about lower fares, Uber said it would guarantee a minimum fare per hour for drivers in these cities.
- username223 12y ago
- bjoveski 12y agoDoes anyone know what's the percentage cut? The article (and all of the comments) don't seem to say anything about that.
- BrianEatWorld 12y agoI received an email notification from Uber that the fare for my most used route is dropping 46%. My normally route is only about $8, so it might be a best case scenario.
- unreal37 12y agoOuch. Well, I hope your rides per hour increase 4X to make up for it.
- HenryLim 12y agoUber and other similar type of taxi dispatching apps are facing new government regulations in countries like Singapore and India after the rape case involving an Uber driver in India last year. It will be interesting to see what happens next.
- mlieberman85 12y agoThe quality of Uber/Lyft drivers and the service in general has plummeted so much lately that I've just switched back to local car services. I just had a nice conversation with a car service driver, who also does Uber, and he said he prefers the car service over Uber because they pay better and only uses Uber when he isn't getting anything else but the pay has dropped over the past year pretty significantly for him whereas when he had started it was pretty good. That's an anecdote so take it for what you will but I just don't see how lowering prices further helps anyone out long term.
- georgespencer 12y agoBecause there is an entire generation of driver now weaned on Uber. They're all over London: guys who got a foot onto the driving ladder and know no other way. They take what they're given. The disaffected professionals are probably the ones who bitch and gripe about money compared to the old days. Uber is now trying to swallow up huge amounts of market share by creating mammoth demand which will presumably lead to more drivers (who haven't been weaned on better-paying services).
- Fuxy 12y agoIt may help Uber out on the short term since they are only looking at the numbers but not their drivers or their customers. You're dealing with humans here and nobody wants to work twice as hard for the same amount of money or very slightly more. So what happens is that the quality slips and good drivers will go where there's more money to be earned easily. There's a limit to how low you can drive the prices before the good contractors start ditching the ship. I foresee bad things in Uber's future.
- wil421 12y agoIn my experience local car services (taxis) or a combo of public transport and taxi have always been cheaper. Uber rides to downtown back to my house ~$100-150, Taxi ~$75-125, MARTA/Taxi combo ~$40-75. I hope to see the prices decrease for Uber. The things that Uber really has going for it that I absolutely hate about Taxis are getting the price up front and knowing when the driver is going to be there. Taxi's will never update you to say if they are coming or not and many times I have been left out in the cold waiting for taxis that never comes.
- raldi 12y agoDo your taxi prices include the tip? And did you price out the MARTA/Uber combo?
- wil421 12y agoNo tips are included. The only reason I didn't price out the Uber/Marta is because I personally haven't tried it yet. The station I go to usually has 1 or 2 taxis waiting so I haven't needed an Uber. Good Suggestion!
- nolite 12y agoI feel that atlanta is special though, because its ridiculously spread out.. its almost financially impractical to use Uber routinely.. For many more dense cities, it makes much more sense
- danso 12y agoThe price cutting makes me more reluctant to use car services...and I realize I'm speaking from a position of privilege here in which I can say that I have enough expendable income to not be against paying a little more for the drivers. I feel that the wage is already so low that it's impossible not to feel guilty using them, what with all the other costs they have to deal with. I try to be as conscientious of a user as I can be: I'll watch the app and only request a ride if a driver is fewer than 3 minutes away from me. And if I have a driver take me from somewhere busy on a busy night to a more secluded area (thus denying him/her the easier fares in the busy area), I'll usually tip. The car services are already such an improvement (in terms of technology) over taxi services that I'm happy to pay for the convenience. And I'm getting less and less enthusiastic about funding a race to the bottom, nevermind the impact it has on customer service.
- tzakrajs 12y agoLast year, I had several Uber Black drivers in a row complaining about how unfair the rating system was or how their employer was unfairly requiring them to accept UberX requests even though they had a livery. Uber threw a decent black car service under the bus to save a shitty ride-sharing business that it is almost certain to get undercut out of. And now they are treating their Uber Black drivers like UberX drivers and it ruins the experience consistently.
- tzakrajs 12y agoSo you can guess my reaction when their recruiters come knocking...
- deleted 12y ago[deleted]
- Spearchucker 12y ago"...I'll usually tip" Interesting. My girlfriend gets upset with me because I always tip. Generously, regardless of the level of service. I also empty my wallet of coins and give it to the first person asking for change. That's driven entirely by knowing that by earning over $100k you're in the top 1% of earners on the planet (median world-wide income is just $10k).
- tlrobinson 12y agoInstead of lowering the base fare why don't they introduce the opposite of "surge pricing" and sometimes delight riders to offset the times they upset them with surge pricing?