New Surge System Revolt Cleveland, OH

Wes

1602 Rider Driver

Posted 5 years, 10 months ago

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Wes Kretzer (Wes)

1602 Rider Driver

Ride Apprentice from Aurora, OH

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Did you catch the national news story out of Cleveland, OH? The new surge system just rolled into town and amidst much misinformation there is a large collection of very unhappy drivers with a "meeting at the hub" planned for tomorrow from what I'm hearing.

So what has the reaction been in your market once the new surge system arrived?

It would seem to me (as a driver) that while we all want to maximize our incomes and few drivers have any concern for the dozens of other drivers that may have been waiting for a ping within the surge market - which would have disappeared without a surge ride before, but with the new system, EVERY driver in a surge area is guaranteed a surge ride on their next ping; (even if the customer isn't paying surge rates)... it seems very fair when you view it through the lens of " sharing the distribution"... and even more when you can see that they DO pay you additional surge dollars beyond the $3-4 dollar surge adder on long trips. In fact you could make MORE with the new system if you were to do several short rides in a row which nobody wanted previously during a surge.

What was it like in your market area when the new surge method arrived?

Featured Answers

RedANT

1072 Rider Driver

Old system:

$25 trip @ 2x surge = Passenger pays $50 (driver made approx 65% of the total = $32.50, and Uber/Lyft made approx 35% of the total = $17.50)

New system:
$25 trip @ 2x surge = Passenger still pays $50 (Driver makes 65% of $25 = $16.25 + a $2.50 fixed "surge" = $18.75 earned by driver. Uber/Lyft collect the balance of $50 - $18.75 paid to driver = $31.25 = approx 63%) Driver pays for 100% of their car payment, insurance, gas, and maintenance. Uber/Lyft does nothing but change policies and adjust app settings to increase their share. Passengers get fleeced.

* Please note that all numbers are approximate, and will vary greatly depending on the area you're in.

** Driver pay was previously paid based on a per minute rate + mileage rate + surge multiplier.

Pay is now based on a per minute rate + mileage rate + a flat surge fee that is a fraction of the former multiplier payout. This change effectively increases Uber and Lyfts share of the fares significantly, taking money out of driver pockets and increasing company revenue. Regardless, I'd bet that Uber and Lyft will still post huge Q1 losses as they head into their respective IPOs.

This is why drivers are pissed. (And rightfully so)

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momof4
8198 Rider Driver
5 years ago
Since the surge changed to flat fees I have seen an average of $2 to $8.00 Mostly $4.00 or less. Once in awhile during a storm or holiday it may go to $15.00/20.00. The storm back in November hit 30.00 in Center City first and last time I seen that. Yes its nice to hit a surge and be able to hold on to it until next ride but I am not real excited over 2.00.
What I am curious about a few months back my daughter called me about 2:15 am to pick her and her friends up because Uber was asking for 122.00 from Center City to Far Northeast Philly. Normally with no surge ride for XL would be $45/$50. I went on my driver app it was showing a 10.00 surge for driver. Where was rest of the money going? Not in drivers pocket. Of course riders think thats where its going. So why tip us if we are making all that money for a 25 min ride? Just Uber screwing over driver yet again.

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BenRosen
86 Driver
5 years ago
Just for the record (perhaps to the non-drivers out there), while the multipliers are gone, the surge bonuses are adjusted dependent on demand. The $2.50 can certainly happen, but you can still get $15~20 on each ride, and they don't care how short it is.
Check out the surge map in New Orleans last weekend.

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DonutDrivers
246 Driver Driver
5 years ago
Drivers no longer even see multipliers, you know. I think this is one of those things the passengers have no idea about. The world has been turned upside down for drivers, but the world blissfully keep on going.

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chawes
756 Rider Guru
5 years ago
What is the point of this?? I thought the purpose of surge pricing was to encourage drivers to go to areas that need more drivers. Now that incentive is gone. So this seems like a boneheaded move on Uber's part!

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  Wes
  OP 1602 Rider Driver
  5 years ago
  It is definitely the intention of Uber to get more drivers into a surge market area. They are encouraging this by guaranteeing ANY driver in ANY surge area that is positioned within the surge WILL DEFINITELY get the surge bonus on their next ping even if the ride comes from outside the surge area. So from that view, it's a great program. And on short rides it's a WIN. But on LONG rides it seems you only get additional surge dollars (on top of the promised surge dollar amount) if the rider is actually paying a surge price and it is a long ride. (That's what seems to be happening). Otherwise you only get the bonus dollar amount. That factor is not written in stone based on anything I've seen or heard Uber say, but I've seen dozens of examples where drivers DID get additional surge dollars on top of the fixed dollar amount on LONG rides, and I've seen examples where the driver only received the bonus amount. It…
  
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  It is definitely the intention of Uber to get more drivers into a surge market area. They are encouraging this by guaranteeing ANY driver in ANY surge area that is positioned within the surge WILL DEFINITELY get the surge bonus on their next ping even if the ride comes from outside the surge area. So from that view, it's a great program. And on short rides it's a WIN. But on LONG rides it seems you only get additional surge dollars (on top of the promised surge dollar amount) if the rider is actually paying a surge price and it is a long ride. (That's what seems to be happening). Otherwise you only get the bonus dollar amount. That factor is not written in stone based on anything I've seen or heard Uber say, but I've seen dozens of examples where drivers DID get additional surge dollars on top of the fixed dollar amount on LONG rides, and I've seen examples where the driver only received the bonus amount. It seems (but this is just my opinion) that if the passenger is indeed paying surge rates they share it with you. If not, it appears you still get the bonus but no additional dollars. Love to hear if anyone has experienced anything differently.
  
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dianeJH
71
5 years ago
I don't understand this. Uber is now paying surge rates out to drivers EVEN when riders are not paying surge?! 1. How can they afford this? 2. Why would drivers be mad?

What am I missing?

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  RedANT
  1072 Rider Driver
  5 years ago
  Old system:
  $25 trip @ 2x surge = Passenger pays $50 (driver made approx 65% of the total = $32.50, and Uber/Lyft made approx 35% of the total = $17.50)
  New system:
  $25 trip @ 2x surge = Passenger still pays $50 (Driver makes 65% of $25 = $16.25 + a $2.50 fixed "surge" = $18.75 earned by driver. Uber/Lyft collect the balance of $50 - $18.75 paid to driver = $31.25 = approx 63%) Driver pays for 100% of their car payment, insurance, gas, and maintenance. Uber/Lyft does nothing but change policies and adjust app settings to increase their share. Passengers get fleeced.
  * Please note that all numbers are approximate, and will vary greatly depending on the area you're in.
  ** Driver pay was previously paid based on a per minute rate + mileage rate + surge multiplier.
  Pay is now based on a per minute rate + mileage rate + a flat surge fee that is a fraction of the former multiplier payout. This change …
  
  Read more...
  
  Old system:
  $25 trip @ 2x surge = Passenger pays $50 (driver made approx 65% of the total = $32.50, and Uber/Lyft made approx 35% of the total = $17.50)
  New system:
  $25 trip @ 2x surge = Passenger still pays $50 (Driver makes 65% of $25 = $16.25 + a $2.50 fixed "surge" = $18.75 earned by driver. Uber/Lyft collect the balance of $50 - $18.75 paid to driver = $31.25 = approx 63%) Driver pays for 100% of their car payment, insurance, gas, and maintenance. Uber/Lyft does nothing but change policies and adjust app settings to increase their share. Passengers get fleeced.
  * Please note that all numbers are approximate, and will vary greatly depending on the area you're in.
  ** Driver pay was previously paid based on a per minute rate + mileage rate + surge multiplier.
  Pay is now based on a per minute rate + mileage rate + a flat surge fee that is a fraction of the former multiplier payout. This change effectively increases Uber and Lyfts share of the fares significantly, taking money out of driver pockets and increasing company revenue. Regardless, I'd bet that Uber and Lyft will still post huge Q1 losses as they head into their respective IPOs.
  This is why drivers are pissed. (And rightfully so)
  
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  drwife46
  57 Rider
  5 years ago
  
  Wow, this is so informative, thanks for posting this. One question - I thought Uber only took like 25% of each fare, you have it at 35%?
  
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  Wes
  OP 1602 Rider Driver
  5 years ago
  The new surge system is a fixed amount. For example a $3-4 dollar adder in lieu of the traditional rates rather than paying a large surge for the entire ride. (However on very long rides they DO give you an additional surge amount). The disadvantage is it can be less earnings on a medium size ride. The good news however is that EVERY driver that crosses through a surge area will get the surge price on their next ride even if it's out of the surge area.
  Uber technically won't lose overall as the surge pay to an individual driver is less (still more than standard rates) but it is ALSO given to EVERY other driver in a surge market area during the surge on their next ride.
  
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  dianeJH
  71
  5 years ago
  
  Huh, very interesting, so it is like they are spreading the surge wealth amongst all drivers. If I was a veteran driver who could predict surges well I would be pretty upset too.
  
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  Wes
  OP 1602 Rider Driver
  5 years ago
  They are "sharing" the surge now. So ALL drivers in a surge area WILL get the "adder surge" in addition to the regular rates. BUT, the surge will ONLY be the dollar amount in addition to regular unless it's a LONG ride in which case Uber seems to be sharing the surge dollars but no one (including Uber) has explained how this works! So yes, on a long ride it could be a loser (compared to the old system) for the driver, BUT, Uber is spending those dollars to the benefit of ALL the drivers in a given surge area.
  Some day we'll get our hands on documentation on how this actually works.
  
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