Apparently Uber’s last round of price cuts has resulted in much higher prices.
Have you noticed that since the last price cuts your area has been surging more frequently and for longer durations? I don’t know if it’s just New York or if it’s everywhere. But I see the same thing in northern New Jersey as well.Before the price cuts, I was really beginning to tire of driving for Uber because it never surged anymore. A year ago at this time it surged consistently in the evenings – making evenings a good reliable time to drive. Then through the fall and winter it almost never surged. The reliable evening surges totally disappeared. And as we all know, it’s hard to make a good day’s pay without a few surge fares thrown in.
Then came the winter price cuts and with those it became really impossible to make any decent earnings. But it seems 3-4 months into the price cuts it has begun surging more and more often. All of Manhattan has been surging from mid-afternoon on for at least two weeks now. Northern New Jersey has been surging for longer than that and they’ve always had much lower rates.
When you realize surge pricing kicks in when there aren’t enough drivers to meet the demand, it looks like so many drivers must have completely quit after the last rate cut that there are now not enough drivers. Which means Uber may have crossed the line (finally) on low prices. It means enough drivers got fed up and said, “no more”, that there now aren’t enough drivers to fill the demand.
It’s good to see that drivers finally had a bottom line, under which they were no longer willing to drive. Sadly for the passengers though, low rates are translating into much, much higher prices. Before the price cuts passengers were learning that if there was a surge in their area all they had to do was wait it out for 2-3 minutes. But now we’re seeing all-day surges. Before the price cuts, when it surged, you wouldn’t get any trips. But now, passengers have seen that they can’t just wait it out. So we’re actually getting trips now during surges.
I’m writing this at about 3:00 in the afternoon on a Friday, and all of Manhattan is surging anywhere from 1.4x – 2.6x. And anything over 1.2x is more than people were paying before the price cuts. And wide swaths of the most populous areas of northern New Jersey are surging right now up to 3.4x – which puts them at a higher rate point than New York’s normal rate!
Maybe Uber will learn the hard way that you can only cut rates so much before massive numbers of drivers defect for better opportunities.