Uber, Lyft drivers manipulate fares at DCA causing artificial price surges • Hacker News Board

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#141

Post by icebraining » Mon, May 20, 2019, 3:17 PM UTC

kdot wrote: post #65

What's the rational for percentage based fees? The technology cost for a 4 mile ride is the same for a 50 mile ride.

> The technology cost for a 4 mile ride is the same for a 50 mile ride.

Technically no, the real-time tracking requires constant data streaming to and from their servers, proportional to the duration of the ride.

But a more likely answer is that a fixed amount per ride makes short rides prohibitive or at least less appealing.

And if you think about it, much of the costs are probably fixed (across all rides), so you could say they should charge $millions to the first ride, then just charge marginal costs for the others. Dilution of costs across purchases is an indispensable part of doing business.

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#142

Post by zentiggr » Mon, May 20, 2019, 3:17 PM UTC

CPLX wrote: post #79

When low paid workers coordinate their efforts to increase their pay it's called an "artificial price surge" and allegations of fraud are thrown around. When highly paid executives, investors, and board members coordinate their efforts to increase their pay what does the media call it?

VC driven exit strategy

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#143

Post by yifanl » Mon, May 20, 2019, 3:17 PM UTC

bena wrote: post #120

mikeash wrote: post #108

Earlier quoted context omitted.

When these services first introduced surge pricing, they told us that it was a good thing because it encourages more drivers to get on the road and take care of demand. It’s working exactly as designed.

The drivers are already there though. They've already committed to taking these passengers. Imagine walking up to a taxi and having them say "wait 5 minutes until I can charge you more".

... If that was how their pay structure worked, how could you expect them NOT to ask you to wait 5 minutes?

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#144

Post by papln » Mon, May 20, 2019, 3:17 PM UTC

mattkrause wrote: post #87

fucking_tragedy wrote: post #81

Earlier quoted context omitted.

FICA tax rate for self-employed under $128k/yr is 15.3%. Effective tax rates for self-employed workers can reach close to 50%.

50% total, or 50% marginal? There’s a world of difference between the two....

In a state/city with high income tax, you'll pay 13.5% social insurance tax, up to 10% state/local tax, and 10-25% Fed income tax, but you'll only hit the high end of those rates in total tax when you gross upwards of $300K/yr.

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#145

Post by mikeryan » Mon, May 20, 2019, 3:19 PM UTC

radcon wrote: post #59

This seems like it could also torpedo their Contractor vs. Employee argument. Contractors get to set rates, employees don't. So you can't say they're contractors AND accuse them of committing fraud when they try to set their own rates. Now if only someone would develop an app that does this for entire cities. The app could be their version of a union.

Contractors get to set rates, employees don't. So you can't say they're contractors AND accuse them of committing fraud when they try to set their own rates.

This isn't how it works? Rates of pay are mutually agreed upon between an employer and employee regardless of classification.

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#146

Post by papln » Mon, May 20, 2019, 3:19 PM UTC

awake wrote: post #132

I’ve heard about this tactic from people working at Uber years ago. I think they’re aware that it happens. The way it was described to me is the Ubers are in a line at the airport and each car signs off except the very first. That way rides keep coming and the first person in line gets surge pricing

This seems easy to fix on Uber/Lyft's side --- to recognize that they don't need to maintain book depth. At the airport, since passengers are effectively queued up.

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#147

Post by thebradbain » Mon, May 20, 2019, 3:19 PM UTC

codedokode wrote: post #102

leereeves wrote: post #90

Earlier quoted context omitted.

Under the theory that Uber/Lyft employees are contractors and allowed to set prices, wouldn't coordinating ("conspiring") to do so en masse be considered price fixing? Personally I think they should be considered employees, but a pro-management federal prosecutor could make some trouble for them.

I don't think they are allowed to set prices. Furthermore, they are probably somehow punished if they don't accept the orders that app offers.

Uber and Lyft don’t let their drivers set rates, but the argument (and law) is that they should — since Uber won a judgement saying their drivers were contractors, not employees, their drivers, then, are legally entitled the right to charging their own rate. For a lot of intents and purposes Uber/Lyft wanted drivers to be classified as contractors so they wouldn’t be subject to laws re: minimum wage for employees, but it seems also don’t want to be subject to all laws re: contracting (price negotiation).

Barring some extreme measure of lobbying for and passing a law that carves out an entirely new employment classification for the gig economy, Uber/Lyft/etc have to comply with at least one of the existing classifications.

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#148

Post by eropple » Mon, May 20, 2019, 3:19 PM UTC

bena wrote: post #128

eropple wrote: post #114

Earlier quoted context omitted.

> Where did I say this was a good or bad thing? Nowhere. You didn't. But nobody perturbs that many electrons if they don't have an opinion on the topic (and I'll be real, I've got one too but I'm not trying to cloak it in neutrality). And then we get this: > In some way, the passenger is being taken advantage of. This is nonsensical. It also proves out the hunch I expressed from my last post, so thank you for doing t…

> This is nonsensical. It also proves out the hunch I expressed from my last post, so thank you for doing the legwork for me. How is it nonsensical? Is the end-consumer just supposed to sit and watch drivers and the company fight to see how much money they can extract from their wallet? Stop trying to make outside forces seem like some sort of sinister scare tactic. It betrays _your_ bias. The agreement is that Uber/…

> How is it nonsensical? Is the end-consumer just supposed to sit and watch drivers and the company fight to see how much money they can extract from their wallet?

Who says the consumer has to take an Uber or a Lyft at all? They have exactly the same right as the driver to not take a ride. The demand curve is elastic; demand goes down as price goes up. Consumers are not locked into Uber or Lyft. Taxis exist. DCA is connected to two train lines.

> Stop trying to make outside forces seem like some sort of sinister scare tactic. It betrays _your_ bias.

Betrays? You get that I'm totally owning my bias, yes? And that I am not the one who is coloring driver action while ignoring Uber and Lyft's internal price fuckery?

Price fluctuations because Uber's internal model knows that I'll pay more for a ride than my girlfriend will are no more legitimate than this, and yet you just let those slide and focus, for some reason, on those "outside forces".

> But they sit at the airport and pretend to not be waiting for fares so they can force a surge. Then they turn on the app so they can both be readily available and get the surge.

So?

That is their only lever for expressing their willingness to work at a given price. If Uber and Lyft provided mechanisms for declaring price levels--"I am only willing to take rides at $X or more"--then this wouldn't happen. But that would reduce the cheap, high-volume rides that make Uber and Lyft their money, so of course they are uninterested in doing it. So drivers have their lever, and they are using it.

I'm gonna be real for a sec: what you're saying amounts to "they need to work for the rich people at the rich people's price because only rich people get to make decisions."

> Are the passengers also not part of the "poor people"?

Compared to Uber and Lyft: sure! Compared to drivers: generally not; of course, there are exceptions...but probably relatively few exceptions leaving DCA via Uber or Lyft).

But they don't have to use Uber and Lyft to leave DCA. Consumers have other options that they can leverage. If nothing else, taxis are a nearly hard upper bound on pricing.

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#149

Post by papln » Mon, May 20, 2019, 3:21 PM UTC

lr wrote: post #52

blakesterz wrote: post #19

I don't quite understand this: "The lot fills with 120 to 150 drivers sometimes for hours, waiting for the busy evening rush. " Are they saying drivers site and wait for hours to do this?

Some people actually do not want to be at home (I once had a taxi driver who drove us from Manhattan to Brooklyn, then waited for us to go home, hours later, all the while texting his family that he had to keep working). Also, leaving the car turned off and waiting in a lucrative parking lot saves gas, wear and tear on the car, and drastically decreases the opportunities to get into an accident. All in all, it is not…

The driver could be doing elance and mechanical turk work while waiting for your ride home!

Re: Uber, Lyft drivers manipulate fares at DCA causing artificial price surges

#150

Post by chrismeller » Mon, May 20, 2019, 3:21 PM UTC

wlesieutre wrote: post #12

News flash: if you go out of your way to classify your entire workforce as contractors, you don't get to decide when they work or not. It turns out this has consequences on both sides. If Lyft wants to decide when their drivers are working, there's a process for this: 1) Hire employees 2) Give them a schedule 3) Pay them hourly plus mileage

I find it hard to agree. Hear me out...

They are contractors because they do not have any set obligation for time. Rate of pay or overall pay has nothing at all to do with that. According to the IRS they do not have a set schedule and they are contractors (that is 1099, not W2).

So they are contractors. What does that have to do with pay? Absolutely nothing. You want x and are willing to pay y. Maybe there’s an opportunity for me to negotiate for z, maybe not. Either way none of that has anything to do with the actual form of employment. Even if I were a salaried employee working 40 hours a week the company has a budget of $40,000 a year and that’s all they will pay. If I demand $45,000 they’ll just tell me no - they simply don’t have the money.

In this case Uber offered you $x. You agreed to $x. You have no schedule, which is the perk of the job vs driving a cab, where you will have a schedule. Need to take the kids to school or a doctor’s appointment? Well, work that around your work schedule.

And as for your third point... Uber already charges me for both time and mileage. I don’t see any problem with them paying their drivers based on both... but from the drivers I’ve talked to they already do. I can’t speak for any other service at all.