Do Lower Prices Really Mean More Business?

For our latest post we welcome guest contributor Jb to share his insights on Uber’s fare cuts – and what that really means for your business. Jb has been a rideshare driver since early 2014, and blogs about his experiences on the blog he runs, uberdriverdiaries.com.

A couple of weeks ago Uber sent out emails to drivers all around the country telling us that their summertime price decreases were going permanent.  In fact, where I am, they decreased prices even more.

But almost breathlessly, they told us in the email not to worry, because lower prices would mean so much more business we wouldn’t even notice.  Unfortunately my car was in the shop for an entire month when that announcement came out so I wasn’t able to check it out for myself.
Falling PricesI got the car back last week though and have been driving ever since and I am sorely disappointed at the results of lower fares.  The problem I was having in my area with the higher fares is that I could easily wait an hour or even two hours for a single trip.  So I was hoping that would change and with the lower fares they could get us 3-4 trips an hour.  But it doesn’t look like it’s to be.

Since getting my car back I’ve racked up a total of about eight hours driving time.  And I have averaged less than one passenger per hour.  I have averaged .85 passengers per hour to be exact.  Today for instance, I drove for three and a half hours.  I got one passenger the first hour and one passenger the second hour.  But in the last hour and a half, I got no passengers.

It really makes me wonder how they’re going to keep drivers on the road.  I used to net almost $20 per hour.  But since last week I’ve netted only $8 per hour – before car expenses.  After car expenses that puts me well under minimum wage.

Can Uber really be serious with these price cuts?

I’ve found, interestingly enough, that there still are a few great ways to continue to make money with Uber. Even though the price cuts suck, royally, drivers that are creative with Surge and leverage the referral program can still make a decent amount of money. There are plenty of ways existing passengers are getting free rides, so take a page out of their playbook and get creative!

Uber Price Cut Email NJ 9-2-2014 a

Curious if your rates got slashed like the rest of us? Reach out to your local Uber team and ask. The local teams are pretty helpful and will usually give you all the information you need. Just keep in mind, the guys on the front lines of customer support aren’t making the decisions. THEY weren’t the ones who decided to cut prices, it was the guys at the top. So be nice and don’t shoot the messenger 🙂

Over to You

How have rates dropped in your city? Have you found the rate drops to benefit, or hurt your business? Do riders tip more when rates are lower?

Discuss below!