Uber Cuts NYC Rates, Escalating Price War With Lyft
Uber announced today a 25 percent price cut for UberX and UberXL, its lowest-cost services, in San Antonio and 79 other cities. But New York Uber’s general manager says the reason they decided to lower prices is to make it more affordable and assessable for riders. Rates for UberX have dropped by 15%.
“When prices get lowered overall, it’s lower for Uber and for the driver”, an Uber spokesperson told CNNMoney.
First reported by the New York Post, the price drop means that a ride from Midtown to LaGuardia Airport that may have once cost $43.67 will now cost $37.12. But the rates – which went into effect 7 a.m. Friday morning – aren’t just a promotional stunt. That’s one of the prime complaints among Uber drivers: sometimes you have to wait a long time between fares.
The new prices will probably make Uber even more appealing in comparison to the city’s yellow cabs, which have already been sidelined by the rise of ride-hailing services.
Uber’s hope is that lowering prices will increase demand, which has lagged during the winter months; the company says it has noticed a similar shift takes place during the summer, when people leave the city. The minimum fare is now $7 instead of $8. Now that Uber has cut rates in the Big Apple, it will be interesting to see if Lyft follows suit.
Uber has also implemented a new hourly guarantee for drivers – $30 to $40, depending on the time of day.
Uber – which was launched in 2009 and operates various ride-sharing services in 68 countries- connects riders to drivers through its apps.