Publications
Partners
Cape Town – A Cape Town father has cried foul after Uber charged his son R2 800 for a 35km trip from Clifton to Muizenberg on New Year’s Eve. That’s R80 per kilometre.
A normal Uber ride 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 cost about a 1 000% higher than a normal ride.
At least he wasn’t charged 50x the normal charge, which is the highest recorded surge charge in the world. That would have cost him R16 450 for the trip.
Uber is an app that connects consumers with drivers quickly, efficiently and safely. It warned its customers extensively through traditional media and social media that its surge pricing policy would be unusually steep on New Year’s Eve due to the high demand.
First-time Uber user
“My son was not of sober mind when he accepted the price surge and was therefore not blatantly aware of the fact that he was going to have his credit card debited to the tune of R2 800,” Nicky Rebelo wrote on Facebook.
Fin24 earlier described the son as a teenager in the headline, but he is in fact 26.
He told Fin24 that he suggested that his son use Uber for the first time instead of driving, thinking he was being responsible. “Even if he was sober, I don’t think he would have grasped the amount he was about to pay. It should have revealed the full price immediately.”
“Being a first-time Uber user, he did not understand fully how the surge charges worked,” he said.
“Uber have declined to offer my son a refund. They are sticking to their guns by saying he accepted the price surge of 9.9x.”
“It is not fair on reasonable people who want to be responsible and then you get punished,” he told Fin24. “Uber are taking a fat chance.”
"It's outrageous and I'd like to start a campaign to call on fellow South Africans to boycott Uber."
Durban anger
Durban Uber users were also caught off guard over New Year's Eve.
Durban resident Jessica Blom was charged R800 to get from Umhlanga to Durban North, which is roughly 12km, making her trip cost about R67 per kilometre.
“Feel very ripped off,” she wrote on Uber’s Facebook page. “Very unimpressed and unfortunately will not be using this service again.”
Toni Larkan wrote on Facebook: “Not such a great start to the year with Uber (Uber X), when they charge you R1 151 for a 10 minute trip from Umhlanga to Umdloti (approx 7-8km). I am prepared to pay a premium for New Year, but to pay a premium increase 1 000% is robbery. The normal fair for Uber X for Umhlanga to Umdloti is R71.94 - disappointed and feeling robbed! I cannot recommend UBER or rate them!”
Uber transparency
"On busy nights with peak demand – like New Year’s Eve – we use surge pricing to get enough cars on the road and help ensure you always have a reliable ride," Uber wrote on its blog.
This was the expected usage of Uber on December 30:
“We'd rather offer you a reliable ride at a higher price point than leave you stranded when you need us most, and making sure that you're aware of that increased price with clear messaging and fare estimates available in the app is the best way to do so,” Uber Cape Town wrote on Facebook.
“Please feel free to respond to your ride receipts for a fare review, and for more information!”
Uber, aware that it’s pricing strategy has created negative press after the Sydney siege situation, sent out messages to consumers hoping to educate them about the service.
“Dynamic pricing is communicated repeatedly to a user – and requires confirmation – before the user can request the trip,” Uber said in a statement ahead of New Year’s Eve.
“Ultimately, we think it’s better for a user to open the app, see dynamic pricing in place and have a choice about whether to proceed rather than to open the app and see that there are no cars available.
“Dynamic pricing helps ensure that reliability of choice and allows riders to have a choice rather than having no cars available at all.”
Uber expensive? New Year's Eve saw record surge figures on the transport app. What were you willing to pay? pic.twitter.com/vJjHy4s2Yk
— Fin24 (@Fin24) January 1, 2015Uber communications head for Africa Samantha Allenberg sent Fin24 the steps they took to forewarn riders about the dynamic pricing that would occur on New Year's Eve:
- Tuesday, December 30, 2014 at 11:00 - email sent to all Uber riders explaining surge and why it occurs
- Tuesday, December 30, 2014 - Uber Blog Post put up titled - Uber Cape Town NYE Blog
- Press release sent to over 60 media contacts to educate them on Dynamic Pricing (see examples here, here and here)
- Social media activity from media and influencers to forewarn riders about surge, pointing them to the blog posts (see example here)
In the Uber app:
- Pop up message letting riders know there would be high demand for cars on New Year’s Eve.
- On the home screen there is a dynamic pricing symbol above each vehicle if it’s surging.
- When you select your location you are then informed of the exact multiplier and you are asked to click a button to accept the higher fare.
- If the multiplier is above 2x you have to physically type in the price multiplier before proceeding to request.
- You can also use the fare estimate button to work out how much your total fare is likely to be at the dynamic price multiplier.
- By the time you request your Uber you have been clearly notified of the implications of dynamic pricing.
How surge charging works:
* Do you have a similar story to tell or do you have ideas that could improve the way Uber works? Let us know now.
