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How Uber surge pricing really works

Discussion in 'Uber Drivers Forum' started by Dreamer, Apr 19, 2015.

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  1. Dreamer

    Dreamer
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    At the core of Uber’s wild success and market valuation of over $41 billionis its data and algorithmically fueled approach to matching supply and demand for cars. It’s classic economics, supposedly: “Prices go up to encourage more drivers to go online. The increase in price is proportionate to demand,” says the official Uber video explaining their surge pricing system. It’s an easy line to buy into, but is Uber’s surge pricing algorithm really doing what they claim? Do surge prices really get more cars on the road?

    http://www.washingtonpost.com/blogs...cing-really-works/?wpisrc=nl_headlines&wpmm=1
     
  2. Dreaney "java" Peaks

    Dreaney "java" Peaks
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    Oh, surge pricing is sometimes 3x times the amount!
     
    #2 Dreaney "java" Peaks, Apr 20, 2015
    Last edited: Apr 21, 2015
  3. UberKurtDesMoines

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    I think Surge pricing is a myth. I've lost count of how many times I've been sitting in the middle of a surge pricing area up to five minutes or more, only to have it disappear. I've been in an orange are when it turns to Surge Pricing, wait and get nothing. Then it goes away.

    Just my experience with Surge Pricing.
     
    OriginalSniper and Glen65 like this.
  4. DodgesTheSun

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    Watch this live uber fare map on a Friday night....let alone if it's a holiday....mind is blown sometimes
     
    #4 DodgesTheSun, May 18, 2015
    Last edited: May 20, 2015
  5. Stiglitz

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    Surge pricing is a bit of sleight-of-hand on the part of Uber. It is not totally dishonest, but it is misleading.
    Note that in any area where surge pricing is active, it will say on the map "surge pricing 1.0 - 2.9x" (or whatever the surge demand multiplier is at that moment)
    That means you may get up to 2.9x, or you may get just the 1.0x base rate.
    One day I intentionally went online in areas where the surge pricing was in effect, the map was deep red, and I expected to make a lot more money. I took about ten rides in those surge areas. It was hard driving, rush hour, more intense, more stress, but I figured it would be worth it. The next day I logged on to my Uber account and saw that I had made about $10.00 more than I had earned on other days when I ignored surge pricing.

    My big complaint is that Uber does these SMS shout-outs to the drivers stating "Hurry, surge pricing is in effect in this area and in that area. Come and make big money."
    That's misleading.
     
  6. SharonInNC

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    How can it be a myth if, you actually make more with 'surge fares'?
    Also, there us no way of knowing what areas the demand is coming from, hence why you can be in a surge area, and never get an alert.
    The radius is too wide. You can't be everywhere. Requests may be coming from the east, and you're in the west. Or, you're in the south, while requests coming from North, and so forth.
     
  7. Glen65

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    Uber needs to protect its name and supply a quick service with the riders and also get as much action as possible taken from the Taxi industry.
     
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