Uber Defends Surge Pricing

A research carried out by Uber's researchers has defended surge pricing.

Uber has taken a step to address the concerns of its users. Uber news affirmed that it would fail to provide a credible facility if it failed to carry out surge pricing. Surge pricing refers to a rise in tariff that takes place when the demand for the cab service has reached higher levels, but not a sufficient number of operators are available on the road.

Uber news today revealed that its researchers, Cory Kendrick and Jonathan Hall, posted on the company’s blog, “We found that, without surge pricing, Uber is not really Uber - you can’t push a button and get a ride in minutes”. To explain this, Kendrick, Hall and Chris Nosko (Assistant Professor of Marketing in University of Chicago Booth School of Business) gave a justification that the company’s policy to increase prices is there to serve the passengers. They experimented by considering the number of operators available after a pop concert took place in New York City’s Madison in March and during the latest New Year’s Eve in NY.

Uber technologies reported that during the event, surge pricing strategy was implemented but not for New Year Eve (NYE). Naturally, for the concert, increases in fares were able to attract more driving partners towards the road within an adequate span of time.

Later, the high demand for the service declined. However, on NYE, the company’s surge charging technology stopped functioning for 26 minutes of high demand because its cab operators were not provided any incentive to drive their vehicles, which could have kept them away from enjoying the event. Thus, the company lost control of the situation.

The speed at which rides are provided – how the transporter determines the rate at which the market reaches equilibrium and its success – rapidly decreased during those 1560 seconds, as revealed by the report. At the maximum, one fourth of the cab services were provided during that period.

Projected arrival time, which is considered to measure the time span that a passenger requires to wait has risen, as revealed by Uber CEO and founder, Kalanick, in 2013. That adversely affected client's interest in the service and forced him/her to stop hiring it. At its highest level, waiting time span was 480 seconds during which surge pricing was not carried out.

It is probable that the findings of the research would improve Uber’s relationship with its customers. Its executives should promote the research’s conclusions to retain its position in the highly competitive market.

Uber Intends To Expand Rapidly

The American high-tech taxi service has decided to expand its operations.

The American taxi service, Uber, has decided to expand its operations. Uber news reported that the company plans to hire services of 2,000,000 driving partners. It is expected that the drivers would be recruited in different parts of the world. Its chief executive officer, Travis Kalanick, has taken the hiring decision.

Uber news today informed that Mr. Travis has recently addressed his staff, media, and drivers at the organization’s headquarters in San Francisco. In his speech, Mr. Kalanick stated that the company intends to provide its service to thousands of cities. He recall the time when two cars used to serve the company and further stated that the company would share its transportation data with city planners and in return, acquire approval.

The company believes that its customers would save their precious commuting time, as they will not find them stuck in traffic. It expects that it would help the city authorities to save money disbursed on the development of garages, parking lots, and public transportation system. Uber technologies affirmed that the transportation regulators of Italy, where it has been banned, have targeted its Pop service, UberX.

The service basically resembles with the conventional taxi service and stakeholders of the industry claim that it should abide by the same laws. Industry sources have revealed that in his speech, the CEO has shared details of the transporter’s most recent service, UberPool. He disclosed that the new ride hailing service would let two passengers enjoy the transportation service in a single vehicle.

The said recent service would reduce the number of cars on roads. Experts presented the view that if the company’s new initiative succeeds, then it would minimize the pollution levels of the world as well.

Apart from the hiring decision, Uber has also decided to take steps to contest in a battle against the Australian authorities, who have decided to act against the transporter’s interests. Government sources stated that Mr. Travis has asked the company’s Australian drivers and passengers to lobby their political leaders on the company’s behalf. 

CEO’s orders have been issued to deal with the powerful anti-Uber stakeholders in the region, which he believes are responsible for its failure in Australia. Industry experts believe that its aggressive hiring policy would provide job opportunities to a significant number of people.

Uber has faced tough times in the past, surrounded by many accusations and allegations. It is highly recommended for it to develop strategies and take steps to speed up its hiring process in the best possible manner.