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Uber: Surge Pricing Is Good For The Soul (And Capitalism)
By
Ben Yakas
Published Jan 13, 2015
Modified Jan 13, 2015
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By
Ben Yakas
Published Jan 13, 2015
Modified Jan 13, 2015
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The Taxi and Limousine Commission (TLC) and Uber have been butting heads regularly over the past year, most recently over electronic trip records. This week, the TLC heard arguments about a City Council bill that would cap surge pricing on e-taxi apps to 100% of the normal rate—and sided with Uber for now. Because siding with Uber is siding with apple pie, white picket fences, sharing HBO Go passwords, Kid Rock anthems and everything else great about American capitalism.
"Uber’s dynamic-pricing model benefits both consumers and drivers," Uber public-policy expert Colin Tooze said at a City Council committee hearing, according to the Post. "If prices were artificially capped within the normal course of business, consumers would be unable to utilize our safe, convenient transportation option because demand would simply overwhelm the available supply. When fares have increased, we repeatedly communicate that fact to the user."
"If it looks like price-gouging, if it sounds price-gouging, it is probably price-gouging," countered City Councilman David Greenfield, who sponsored the bill. Currently, Uber is able to hike fares up 900 percent "when demand outstrips supply," leaving people with insane bills for rides taken in inclement weather and during peak drunk weekend hours.
Earlier this year, the company agreed to limit fare hikes during emergencies and natural disasters. An Uber spokesperson told us at the time, "Uber worked closely with the New York Attorney General earlier this year on a policy that balances the goal of transportation availability with community expectations for ride affordability during disasters and remains compliant with New York State law on pricing."
TLC Commissioner Meera Joshi said that she agreed in spirit with Greenfield's concerns about price gouging ("It is essential that the City help ensure that consumers have true transparency about the prices they will be paying"), but she had problems with the language of this particular bill (i.e., drivers could be hit with fines rather than Uber/Lyft/whatever e-hail apps).
Uber said in a statement: "Dynamic pricing ensures Uber remains a reliable ride in communities during times of peak demand. Our in-app features are designed to communicate the pricing repeatedly and require approval by the user before any trip is requested."
Other taxi apps are also mobilizing to compete with Uber: sources tell Buzzfeed that other apps are considering "forming a global alliance of regional players" to create a "potential global taxi alliance" (the details of which are as globally vague as it regionally sounds).
Tagged
capitalism
surge pricing
taxi limousine commission
tlc
uber
Ben Yakas
Ben Yakas is a former Gothamist reporter.
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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