Every day it feels like things are becoming more and more expensive. The cost of living is sky rocking across the globe. Airfares are soaring, hotels and Airbnb’s are going up by the day, and fuel costs are hitting record levels.
Everything seems to be going up. Unfortunately, transportation services are no exception. Ride-sharing company Uber has made a lot of changes in recent weeks with the hopes of expanding its business model.
Soon, however, the cost of ordering an Uber will cost you a lot more than it did a year ago.
When Uber first broke into the market in 2011, it quickly became a rising star in the tech field as well as becoming a favorite app for millions of Americans.
People who commuted for work, traveled for business, or simply just needed a ride home late at night, it seemed like everyone wanted to use Uber – and rightfully so.
It was an ingenious idea that became popular not just because it was convenient, but also because it was affordable!
Finally, could you get around town without having to pay an arm and a leg. No more heckling with opportunistic taxi drivers for a lower fare. No more waiting outside in the blistering cold, hoping you’d get picked up by a taxi.
At last, Uber came and seemingly took over the industry by storm – it was what society needed.
And for a while Uber was just that, tremendously affordable. Unfortunately, it seems like those days are over.
Uber was affordable because it was heavily subsidized by investors but over the course of the past years, Uber has consistently lost a significant amount of money, including more than $30 billion the five-odd years since the company’s finances became public.
The solution? Higher costs passed on to consumers.
Rides have been getting—and will continue to get—more expensive. Average Uber prices rose 92 percent between 2018 and 2021, according to data from Rakuten; a separate analysis reports an increase of 45 percent between 2019 and 2022.
Both Uber and Lyft have added a surcharge for riders that helps drivers account for high gas prices.
A once rising star in the transportation industry
It isn’t too farfetched to believe that Uber was burning all that investor cash in order to corner the market.
Once it killed off car service, taxi cartels, and its ride-hail rivals, the company would stop charging riders less than it was paying drivers and prices would have to go up.
This week an Uber from Manhattan to JFK Airport was $100—nearly double the fixed yellow cab rate. But take a guess how long it’ll take you to find a yellow cab.
The fundamental problem Uber and Lyft keep running into is that most people are not willing to pay the fares it would cost to run a profitable taxi service with the overhead Uber and Lyft require.
At the end consumers are the ones who are suffering
Uber fares are at a record high with no end in sight. What once was a convenient and affordable way to get around town, turned into something a lot more expensive and burdensome for people.
For years we were made to believe that one can take a 20-minute drive and only pay $7 for it.
Clearly that is no longer than case and consumers will have to take a very hard look at whether or not they’re willing to pay the price for Uber now and in the future.
Top 10 Most Expensive Uber Cities in the U.S.
- New York
- San Francisco
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- San Luis Obispo
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This article originally appeared on TravelOffPath.com
Monday 19th of December 2022
Denver should be on this list! Uber I find to be extremely unreliable and over priced. I recently booked an advanced booking from my house to the airport. I needed a pickup at 430am so I booked two days in advance. The cost one way was $94 dollars!!! More than my plane ticket!!! On top of that the uber driver canceled 10 minutes before pick up causing me to miss my flight. What good is it to charge such a high cost for an advanced reservation if the driver will not show up??? I think there needs to be more competition in this market!
Saturday 4th of June 2022
On May 31 in Puerto Vallarta, Mexico, Uber was 25% higher than taking the taxi (no surge billing with Uber). I took the taxi. The ride with Uber was more than double the week before. I’m back to checking with taxis in PV now as they are flat rate, agreed prices. That said I like the payment system uber has and the car and driver tracking.
Saturday 4th of June 2022
Well, you got one thing wrong, Uber had a 25% commission fee, and lyft a 20%, and they still managed to make losses; which is mind-boggling if you ask me.
Now the roles have changed, and uner amd lyft are taking anywhere from 50 to 75% of the money, and drivers are quitting left and right, because they can't make a decent living, despite driving more than twice to trice the amount cab drivers did.
What's more, inflation also plays a big role in all this. Home prices increased by 100% not in 4, but just 2 years in Florida.
Gas prices rose by 50% in 6 months.
Friday 3rd of June 2022
@ Donald, you just nailed it,, Uber doesn't care about drivers, and the article somehow I don't agree about Uber raising their fees,, in Cape Town, SA, and since Uber launched in 2013 the fare are still the same UberX, XL & Uber Black (premium),surging prices cannot be counted as price increase because it normally happens for a few minutes after an event/function, & their commission will rise as well during that surging period so it's not Drivers incentives, Instead U et actually reduced prices when they introduced UberGo in these difficult times of inflation from fuel to groceries and they don't care, worse as a driver some trips reduces the fare whilst enroute ,only to be surprised with a low fare upon arriving,, it's a shame!!!
Wednesday 1st of June 2022
What overhead the people that are customer service that barely answer the phone.
Saturday 4th of June 2022
@Melissa, Apparently the cost of renting amazon was servers to keep their services online 24/7 fast and super reliable, is huge!
Also, renting airport strips, and parking space for drivers is a prime real estate that costs tons of money. Aside from that, Uber and Lyft management and CEOs, don't come home earning the same pay as their drivers. Not even 10x what their drivers make, if they worked the same amount of hours. I think many of then earn a disgusting 100x what their drivers make. And that is a problem that needs to be addressed. Make $1 a year, and the rest in stocks.