Uber’s ‘dy­namic pric­ing’

The New Age (Gauteng) - - FRONT PAGE - TATENDA CHIRISERI news@the­newage.co.za

RIDE-HAILING app Uber has warned of a price surge on New Year’s Eve, say­ing the high de­mand for trans­port cou­pled with the short­age of driv­ers will­ing to work dur­ing the hol­i­day is to blame.

Uber has been warn­ing cus­tomers ex­ten­sively through tra­di­tional and so­cial media to ex­pect to pay more for a ride dur­ing times of high de­mand. New Year’s Eve is the com­pany’s busiest day in many coun­tries around the world, in­clud­ing South Africa.

Uber users have re­acted on so­cial media, fum­ing about higher prices dur­ing the fes­tive sea­son. Fre­quent Uber user Mitchell Ma­suku said: “Uber has been ex­tremely ex­pen­sive dur­ing the fes­tive sea­son. I have been us­ing Tax­ify in­stead be­cause it’s half the price.”

Uber said this “dy­namic pric­ing” was part of its business model and fol­lowed mar­ket prin­ci­ples of higher prices when de­mand was high. Be­cause Uber driv­ers get most of the taxi fare, they are also en­cour­aged to work dur­ing such times as they earn more. In turn, this makes more driv­ers avail­able for cus­tomer con­ve­nience.

Uber spokesper­son Sa­man­tha Al­len­berg likened the pric­ing to that of ho­tels and air­lines, which charged more dur­ing peak sea­son. In 2015, a Cape Town fa­ther cried foul after Uber charged his son R2800 for a 35km trip from Clifton to Muizen­berg on New Year’s Eve – about R80 per kilo­me­tre.

An Uber ride at a non-peak time from Clifton to Muizen­berg costs be­tween R247 (R7/km) and R329 (R9.4/km) ac­cord­ing to the Uber es­ti­ma­tor on the app, mak­ing his New Year’s trip about 10 times the off­peak price.

“My son was not of sober mind when he ac­cepted the price surge and was there­fore not aware of the fact that he was go­ing to have his credit card deb­ited to the tune of R2800,” Nicky Re­belo said on Face­book. He’d sug­gested that his son use Uber for the first time in­stead of driv­ing, think­ing he was be­ing re­spon­si­ble. “Uber should have re­vealed the full price im­me­di­ately,” Re­belo said.

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