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Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

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Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#61

Post by ballpoint »

awwstn wrote: post #36

Here's what I think led to this: UberX was priced appropriately for the market, but Uber wanted a larger cut of revenue. (Say average ride was $12, Uber gets $2.40.) In January, Uber announced a 20% decrease [1] in UberX prices. (Continuing hypothetical, average price could be $9.60, and Uber gets $1.92) This week, Uber adds the $1 safety fee, of which drivers get none. Now, continuing my hypothetical averages, the a…

I'd be really surprised if Uber thought the short-term value gained through the extra income would be larger than the long-term loss of value through goodwill caused by adding this charge. All of Uber's rhetoric is about the long game.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#62

Post by iancarroll »

delinka wrote: post #55

Sounds like a PR move to me. With all the legislation attempts around the country targeting Uber and those opposed to Uber complaining about lack of oversight, lack of insurance, lack of background checks, etc. This looks to me like a "yes, we do perform background checks and verify (or provide) insurance" statement.

A badly executed PR move, charging your customers more.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#63

Post by sizzle »

tomkarlo wrote: post #48
erichurkman wrote: post #13

Earlier quoted context omitted.

Or, when you get a driver that makes you fear for your life because they are spending more time paying attention to their three GPS devices instead of traffic, do you get a $1 refund for the un"safe" ride?

The last time I took an Uber to SFO, the driver stepped out of the Prius without pressing the "Park" button. Maybe I would have gotten my $1 back.

sorry I haven't used uber, what does the driver not pressing the 'park' button do?

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#64

Post by r00fus »

tomkarlo wrote: post #48
erichurkman wrote: post #13

Earlier quoted context omitted.

Or, when you get a driver that makes you fear for your life because they are spending more time paying attention to their three GPS devices instead of traffic, do you get a $1 refund for the un"safe" ride?

The last time I took an Uber to SFO, the driver stepped out of the Prius without pressing the "Park" button. Maybe I would have gotten my $1 back.

Did they have the parking brake on? Not a big deal if so, though inadvisable.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#65

Post by cbsmith »

awwstn wrote: post #36

Here's what I think led to this: UberX was priced appropriately for the market, but Uber wanted a larger cut of revenue. (Say average ride was $12, Uber gets $2.40.) In January, Uber announced a 20% decrease [1] in UberX prices. (Continuing hypothetical, average price could be $9.60, and Uber gets $1.92) This week, Uber adds the $1 safety fee, of which drivers get none. Now, continuing my hypothetical averages, the a…

My understanding from talking to drivers is that when they announced the price change for UberX, they cut their commission from 20% to just 5%. So that means Uber now gets $1.60 and the driver gets $11.40 from a $13 fee. If this is a margin growing scheme, everyone at Uber needs to take remedial arithmetic.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#66

Post by uptown »

bertil wrote: post #47

I don’t think Uber is trying to do this to pay for check: they are asking its users to contribute to safety. It's a branding move — confusing as many have pointed out, but fairly clear when you consider psychology/behavioural economics. The amount is minimal, and the motive too vaguely in the right direction not to be agreed with. You can’t even not select the option. The idea is the same as adding a ‘green’/ecoLabel…

Except all it takes is one bad incident with some negative publicity to spoil the perception that adding this fee ensures you'll be safe. People will ask - why were we paying this when it didn't seem to prevent "X" from happening.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#67

Post by jasonwilk »

For the amount of time I spend in an Uber, it doesn't make sense to pay $1 for EVERY ride. Pennies per ride would make more sense.

If I was Uber, I would charge a $1 per year membership fee to ride UberX to take care of insurance and background checks. Based on the amount of users, that should be more than enough to cover insurance and background checks on every ride I take. Would also be nice subscriber revenue for Uber even though it will be trumped by their overall bookings number.

Just my two cents.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#68

Post by seryoiupfurds »

sizzle wrote: post #63
tomkarlo wrote: post #48

Earlier quoted context omitted.

The last time I took an Uber to SFO, the driver stepped out of the Prius without pressing the "Park" button. Maybe I would have gotten my $1 back.

sorry I haven't used uber, what does the driver not pressing the 'park' button do?

The [park] mode of a Prius's transmission is button-activated.

Re: Uber adds $1 “Safe Rides Fee” to UberX rides for background checks, insurance

#69

Post by aetherson »

cbsmith wrote: post #65
awwstn wrote: post #36

Here's what I think led to this: UberX was priced appropriately for the market, but Uber wanted a larger cut of revenue. (Say average ride was $12, Uber gets $2.40.) In January, Uber announced a 20% decrease [1] in UberX prices. (Continuing hypothetical, average price could be $9.60, and Uber gets $1.92) This week, Uber adds the $1 safety fee, of which drivers get none. Now, continuing my hypothetical averages, the a…

My understanding from talking to drivers is that when they announced the price change for UberX, they cut their commission from 20% to just 5%. So that means Uber now gets $1.60 and the driver gets $11.40 from a $13 fee. If this is a margin growing scheme, everyone at Uber needs to take remedial arithmetic.

They raised the commission back up to 20% at the same time they added the $1 "safety" fee. Here's a reference:

http://www.geekwire.com/2014/uber-adds-1-safe-rides-fee-pass...

My read is that they thought they could keep Lyft from taking their market-share by losing money on every ride and relying on their deep pockets, but then Lyft got a comparable amount of money to Uber, and Uber was like, "well, guess we won't be waiting them out."

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