Has Uber fixed its surge-pricing problem?

uber new surge

Last year during certain major events — Halloween and New Year’s Eve — Uber introduced surge pricing to deal with high demand for its cars. The thinking was that by increasing rates, it would have a greater supply of drivers, because they would be more likely to work if they were getting paid a lot more. It would also dampen demand a bit by scaring off some users who might be on the fence about paying several times more than the usual rate.

In theory, it sounded great. In practice, what ended up happening is that a number of users didn’t fully understand what they were getting into when they clicked the “Request Pickup Here” button. And when they reached their final destinations, many had quite a bit of sticker shock when they got their receipts, some well over $100 for a mile or two of travel.

During New Year’s Eve, while the app told many users that rates were as much as six times that of a typical ride, few consumers mentally processed how much more that meant their ride would cost. It didn’t tell them, in real monetary terms, what to expect. It also didn’t clearly let users know when rates expired, which led to some confusion when prices were raised.

On Wednesday, Uber announced a revamped version of the app to deal with surge pricing when it hits, which will better illustrate to users exactly how much fares have been jacked. The update gives a few key bits of information: For one thing, it has a range of average fares for the trip at the current pricing, which will help demystify what the trip will actually cost for most users. It also clearly labels the multiplier, and tells users how long the current rate will be in effect, and when it expires. (Interestingly, the updated surge pricing screen seems to take into account some feedback from OneSheet creator Brenden Mulligan on his blog after the New Year’s Eve debacle.) The update should help clear up price misunderstandings in the future.

But here’s another idea for Uber (probably one that it’s already considered): In addition to their origin point, also allow users to plot their destination before calling for a car. Then give an estimated cost for the entire trip. Not only will that give users a better idea of what the whole thing will cost, but it will also allow Uber — knowing what it does about the traffic patterns of its various cities during different and times of day — to plot the most efficient route for drivers, so they’re not just going on their gut.


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