A lot of people complained on social media about the ride-sharing company’s decision to hike prices on New Year’s Eve to unprecedented levels. Some customers said that they were charged nine times the regular price, but the firm said that that was an exception.
Reportedly, the taxi-app firm used an algorithm to hike fees by default whenever there was an imbalance between demand and offer on New Year ’s Eve. Some customers were irked that they had to take out of pocket hundreds of dollars to get home.
But the company said that most prices were only hiked three-fold or less between Dec. 31 and Jan. 1, while 60 percent of rides were not surcharged. There was also a good side of the surge pricing – more drivers were available that night lured in by higher fares. This is why in some areas you could get a car in less than three minutes.
Nevertheless, even drivers were ashamed by the sudden surge in prices. For instance, one driver recalls that a teen had to pay 9x the regular price to get home and in the end he had to fork out $200.
Unfortunately, drivers were helpless in negotiating a lower price with customers because the system doesn’t allow them to do so. Plus, there were some drivers that took advantage of the situation to boost profits.
For example, some of them cancelled bookings and waited for the algorithm to hike fares high enough before picking any new clients.
“Massive surcharge … after two cancellations. Predatory tactics,”
said one Uber customer in a Facebook post.
Other Facebook users recall that they had to pay nearly $100 for a single ride after several drivers cancelled their orders. While people posted pictures of prices being hiked 9.9 times over, many reports show that some other U.S. customers had to pay a lot more than they had planned to.
The practice however may not seem fair because yellow cab drivers are barred from hiking prices in hot spots. No such rule applies to Uber and other ride-hailing companies. Yet, Uber claims it has a clear conscience because it had warned its wannabe customers about the surge pricing in advance.
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