While some of us spent Saturday night literally walking miles in the snow (and sleet) in order to do our holiday partying (turns out, moving right before the holidays is an expensive thing to do!), others may have tried to order up a cab using Uber, only to find that a ride that would normally cost $10 would clock in at, oh, say, $80, thanks to a cool new trick called “surge pricing.” One friend posted an Instagram of an estimate for a ride at 7.5x the normal rate, which constituted a $90 minimum fare and charges of $5.62 per minute, and $22.50 per mile. The massively increased fares were accompanied by a chipper message explaining, “Demand is off the charts! Rates have increased to get more Ubers on the road,” and a button encouraging users to “accept higher fare.” Turns out, lots of people didn’t!
Or at least they did, and then complained about it (one Boston blogger posted her $91 receipt with the caption, “I’m really disappointed in u guys”). Uber’s justification is that the higher rates incentivize more of their drivers to get on the road in inclement conditions and peak hours, and CEO Travis Kalanick has even suggested that customers unable or unwilling to pay “surge” fares may not even be given the option for these cars during peak hours.
As the Post points out, this is the same policy that got the company into trouble after Hurricane Sandy (and temporarily disappeared afterwards), and maybe the most surprising part of this whole thing is that a company as PR-savvy as Uber—free rides in Brooklyn! Kittens! Christmas trees!—could be so blind to how terrible it looks to charge people $200 for a short cab ride just because you can. It’s less surprising that a darling of the startup world—an industry that’s always had an unsettling libertarian undercurrent, and like any other business, designed to make a profit—would see a policy this crazily free-market as totally justifiable.
It’s also probably an experiment Uber will tweak over time, but in the interim, best to keep in mind that next time you really need them, they’ll try to shake you down for everything you’ve got. That, and that it never hurts to have the numbers for at least a few different car services on hand.
Follow Virginia K. Smith on Twitter @vksmith.