Ride sharing is becoming the new taxi service, with people ordering a lift for their friends from an app on their phone and then having someone come and pick them up in their car. Uber is the biggest example of ride sharing, with the app even being considered as the end of taxi services. The problem Uber has is that it is fully in control of their fee’s and tend to adjust them based on demand, but thanks to the DC metro shutting down Uber are capping this increase and say they won’t raise prices more than 3.9x.
The algorithm used to calculate Uber’s rates has been targeted as a bad example when it raised prices by over 4x in Sydney when people began fleeing a hostage situation in 2014. While Uber refunded these and even offered free rides to others, the company wants to ensure that it doesn’t suffer this embarrassment again.
With the DC metro closing, Uber is enforcing a cap on the price hike at 3.9 times the original. While they encourage people to share the rides and split the costs, it would seem that the initial impact of the metro shutdown only raised the price by 1.7 times its normal price.
Do you think companies should be able to raise prices like this? should there be a limit on how much they can raise their fees during busy times?