Uber Says New York Demand is up 30% Since Prices Were Cut

Thinking Highways
By Thinking Highways March 1, 2016 12:46

Uber Says New York Demand is up 30% Since Prices Were Cut


Uber has taken a lot of flack from some of its drivers since it lowered fares in January, but the ride-hail company argues that the cheaper rides are having the desired effect. 

In New York City, for example, where fares were cut 15 percent on January 28th, demand for uberX rides in some neighborhoods has risen over 50 percent in the three weeks since the cut, compared to the previous three weeks, the company says. Trips in Soundview in the Bronx and Jamaica in Queens, both working-class neighborhoods, rose 55 percent and 51 percent, respectively.

Uber did not release trip data for the entire city, but in a separate blog post it provided a borough-by-borough breakdown of demand in the three weeks after the fare cut. When averaged together, demand for uberX rides rose 31.4 percent in the first three weeks of February. But by highlighting the outer boroughs, Uber appears to be responding to critics who say the cut hurts drivers, many of whom live in those very neighborhoods.

Uber hasn’t released similar analyses of other cities where the fare was also reduced, like San Francisco; Los Angeles; Boston; or Washington, DC. Indeed, the blowback from drivers has been loudest in New York City, where some critical groups have tried to organize a boycott of Uber, to little effect.

Uber also analyzed anonymous trip data to determine where its customers were going, and the results are not that surprising. Around 33 percent were taking Uber to work or home, indicating that a third of customers use the ride-hail service to commute. Twenty-nine percent take Uber to a transportation hub, mostly an airport, and 16 percent ended their trips at a hotel.

The Standard Hotel, next to the High Line in Manhattan, was the top hotel destination for Uber passengers. Goldman Sachs Tower in Lower Manhattan was the top office destination, while LaGuardia Airport and Grand Central Station were the top transportation hubs. The top bar was Lavo and the top restaurant Vandal, both of which were designed and owned by the same team of nightclub investors. Aside from LaGuardia and Grand Central, all of these destinations are for well-off people, which suggests that despite its attempts to position itself as the ride of choice for the outer boroughs, Uber is still a premium product.

The new numbers were released just as Uber faces a number of modest bills in the New York City Council. One measure would prohibit Uber drivers from exceeding fare estimates to riders by 20 percent. Another would create a universal license for taxicab and for-hire vehicle drivers. Uber did not send anyone to testify at a hearing for the bills Monday.

A plan floated by Mayor Bill de Blasio to drastically reduce the number of new Uber drivers allowed on the road has been abandoned. And disability rights advocates have assailed the council for neglecting to take up legislation that would force Uber to make half its fleet wheelchair accessible, like yellow cabs in New York must do by 2020.

Thinking Highways
By Thinking Highways March 1, 2016 12:46