I noticed something strange earlier this month when I pulled up the Uber app and requested a ride.
- I had my monthly $15 American Express Uber credit in my account
- The price for the ride was displayed net of this credit (rather than full price, just showing the Uber credit as a payment method later)
- And the fare seemed higher than usual. It was also much higher than Lyft.
My hypothesis was that Uber seemed to be picking a higher price because I had credits in my account. I might be willing to spend more because my ‘real’ out of pocket cost was less, and those credits were trapped anyway.
I decided to use my Uber credits for Uber Eats instead. That pricing seemed normal. I need to keep my eye on this.
Reader Charles says he noticed something similar.
- He regularly pre-books rides with Uber – between the same locations at the same time of day – and generally finds the price to be stable ~ $20 and a bit cheaper than Lyft.
- He bought Uber gift cards at Costco for a 20% discount to face value. That’s when things got weird.
Loaded first $50 card in my uber account, everything behaved normal. I loaded another $200 before taking Uber to airport, then was surprised to find uber won’t allow payment with uber cash loaded in the account this way for rides scheduled ahead of time.
…then stranger things happened: for same ride I book regularly increased from about $20 to $30! Just as a sanity check, Lyft is still ~$20 for same ride.
He went a step farther and did something I didn’t: he checked Uber prices “with someone else’s phone” who did not have a balance in their Uber account – and Uber was pricing the route at the usual $20 for them.
I don’t know exactly what’s happening here, but something seems strange and – unsurprisingly – not in a customer-friendly way. At the same time, I’m also not the first person to experience (or think they experienced) this. Have you seen anything like it? I’d be curious your experiences, especially once you get Uber credits in your account. My theory, and it is definitely just that, is this is something they’re testing on a subset of users to learn how customers respond.
Remember when Uber brought in Dara Khosrowshahi from Expedia to be their new CEO, to become kinder and gentler and friendler? At the time I figured things would get worse because he was literally in charge at Expedia. But drivers now seem to earn less, even though (because of) tipping. It’s more expensive to customers, too. And there’s no more “surge pricing” – they just charge you higher and higher amounts without telling you they’re doing it.
If Uber charges more for a product of there are cash-equivilent credits that is ripe for a class action or a multi-state AG action. V dumb on their part. No one “likes” Uber as a company so it would be politically popular.
Uber has a robust, academically minded, in house team of economists who are no doubt researching questions of willingness to pay. A small audience of users has probably been chosen as the test group for higher pricing with gift cards.
Uber 100% does this.
Was booking an employee from Fort Lauderdale to Orlando on Brightline. If you book their Premium fare, it includes a $10 Uber voucher to help get you to the station.
Applying the $10 voucher caused the rate to increase $12 (maybe $17) so using the voucher cost MORE than not using it. Total marketing lie.
This appears to be true in my experience. I personally find that if I change the payment option to a credit card and re-price the fare, it becomes cheaper (!) than using the wallet/gift card balance.
I work around it by charging the fare to my credit card, and then having Uber switch the payment method to the voucher after the fare settles. They refund my CC and charge the voucher.
This frustrates me immensely and makes me further glad that we have Lyft as a competing service.
This is not the only cheating that Uber does. They also discriminate heavily on your pick up/drop off location. Try putting in a 5 star hotel and then try setting the destination across the street instead. Almost definitely a big difference.
If you are going to the airport, try different terminals (especially EWR or JFK), the difference can be $30-40.
Uber has basically institutionalized the cheating taxis used to do informally.
My partner has the Amex plat and I always get better pricing then him.
I found that instacart does the same thing; I was regularly getting discount offers and the moment that I bought a gift card at costco, the deals disappeared. Shortly after using the gift card, deals started coming back.
I decided to stop using both apps; they are super shady.
It’s getting so who wants to travel anymore? Hotels treat customers like crap and all too often aadd on phantom service charges. Airlines are constantly stranding passengers. Car rentals have their customers arrested. And now Uber has institutionalized cheating. It’s best to just stay home.
Looks like applying the “credit” made the total fare go up $15.87 from $7.05 to $22.97.
@gary: I have the screen shots to prove it but couldn’t find an email address / other contact point to send them to you.
Ever since Uber eats gift cards showed up at Costco, the slickdeals people have noticed this. In my experience going out on weekends Uber and lyft would be a similar price. Uber sometimes up to $5 cheaper or quicker pickup if the same price. Now that I’ve put gift cards in my account uber is 10% or more than lyft.
It’s called individualized pricing. DL gives a different price to upgrade from economy to Delta One to different people on the same flight at the same time. They base the price they offer you on the data they have collected on you, and basically boils down to how they think you can or will pay. https://www.wbur.org/onpoint/2024/08/14/surveillance-pricing-harm-consumers-ftc-data?fbclid=IwY2xjawE3a0lleHRuA2FlbQIxMAABHeE7pUaR360nTzuJav61ohT_kuDAjcTvOFBSPyxxcLq1bX3MBxS0xd9bmA_aem_jeTMFT7Wl9OlE9r2Kqrn-Q
Ugh… I just loaded $200 in gift cards to my account. Makes sense now because I always found Uber more expensive than Lyft (where I have no credit balance) for rides, so I would just book with Lyft. Wonder if this also applies to fees they charge on Uber Eats.
I can’t be sure of the timing but I did load a large gift card balance ($350) and found I wasn’t using it because Lyft is so much cheaper.
This is my just deceptive , it’s the fraudulent selling of gift cards which aren’t worth face value directly in them pricing/psymeny algorithm.
Didn’t Uber also charge more if it knew your battery was about to die?
It really need not be said, but Lyft does this exact same sort of price discrimination. Standing right next to my partner with her phone out, my Lyft Pink account that came free a while ago with a Chase Reserve was pricing out at about 15% higher ($35 vs $30) even after “discounts.”
I’ve consistently had worse experiences with Lyft including a driver that took an hour to pick me up from MDW after being told it’d take 10 minutes. Support told me to pound sand when I asked about cancelling and that I’d still be assessed the fee even though the driver was just doing his own thing. Literally any time an Uber driver has tried to pull that scam, Uber support acknowledges it and comps the fee and sends a new driver.
Using my Amex Platinum from my apartment to the airport, I regularly saw Uber fares to be about $15 more than Lyft. Yes, they do it.
That would surely also be against their contract with Amex, right? If they’re doing this, Amex is on the hook for offering a benefit that really doesn’t exist, right?
Not sure about higher pricing when I have credits. However, I have a personal account as well as a business account. The ride to the airport right now is $42 if I select a business trip. If I switch the trip to personal, it applies a “15% flash sale” promotion. I have seen this regularly. I guess the thinking is that people are expensing their work trips and not price sensitive? The $15 Amex credits also only show up on the personal side.
Incidentally this can be avoided by saving the business credit card under the personal account.
I started loading gift cards a while back and noticed pretty much all the shenanigans talked about here. Final nail was when I was overseas and couldn’t use my uber balance. I finally burned through the rest of my credit and cancelled my last Amex card with the uber coupon. Good riddance.
Absolutely Uber cheats! Happened to me twice, once from SFO to downtown, then again from ATL to a Top Golf location. Basically, because I occasionally got UberBlack car service, the prices they quoted me for a regular Uber were *higher* than the person next to me in the same line getting a regular Uber. Never again, which is why I only use Lyft and simple, regular Taxis. I believe it’s also why Disney World uses Lyft as well.
Uber- IMO- simply exists to charge a toll between drivers and riders, and to maximize that toll as much possible, instead of maximizing the value the customer can receive. In my experience, there is only *ONE* other company that does the same thing, and that is GoFundMe, as they have figured out a way to charge 10% more to certain segments of donors who are either too naïve, (or more likely) not paying attention when making a donation online. It’s crazy.
This is literally a company whose entire business model was to just ignore existing taxi regulation. Why would you ever be surprised that they are doing unethical things to get more money from their users?
Good to know. I occasionally use Uber. Charges to and from LAX are higher than to and from nearby LAX. The hassle of dealing with bags and waiting makes putting in an extra stop not worth it. In a week I will be doing a one way Enterprise rental since it has about same total cost and it will get me to my destination quicker than my usual bus to Van Nuys FlyAway and an Uber or taxi from there.
I ride Ubers too infrequently to notice this, but I have been duped by a ride’s quoted price’s turning out to be the leftover cost after my credits are applied.
So Uber can’t be trusted for an honestly priced ride. That’s enough impetus for me to refuse to use them at all for rides, except in places such as rural Puerto Rico where it’s cheap and there’s no public transportation. Uber Eats is still reasonable when I collect food from places with special offers.
Seth
Uber also does some opaque accounting with UberOne credits earning and usage.
I typically have an UberCash balance on my account.
The balance before my ride minus the (fare + tip) should equal the new balance…but it doesn’t.
What I figured out was that I “Earned 1.97 with UberOne” but in the fare calculation I used “Uber One Credits” of 1.30…a difference of .67 cents (which was the amount my balance was off).
They need to make clear line items for UberOne earnings and UberOne usage (fare credits).
Bottom line: I too have been watching Uber closely for charging practices mentioned in this blog.
The rider nor the driver matter to Uber it’s all about their pocket and their investors. They are one of the most crooked companies in the world. I know I’ve been driving for them for 8 years and I know they’re screwing everybody. It’s a fact!
I have been thinking this. It almost certainly does with Ubereats. My meal is always the same cash price regardless with or without credit. The fees increase when I have credit.
I wonder the same thing about their promotional “deals.”
Sounds to me like an extremely unscientific conclusion based on random anecdotal DPs biased by people’s feelings and hatred of various companies. Prices change by the minute, hourly and daily. Attributing that to one factor, your balance, is rather silly. No doubt they do experiments with pricing between different users to maximize profit, but I seriously doubt until proven otherwise that your balance has any impact whatsoever. You all are just fantasizing about a conspiracy theory as if it’s established fact, as occurs often in today’s society.
It’s 25 data points just for me if you look at the change in Uber vs Lyft pricing. Went from sometimes Lyft lower, sometimes higher, to always Uber 15% higher.
Old news that Ubers new dynamic pricing is to charge you as much as they think you will pay.
I had a thread on it as well. Uber 100% does it. Have never been able to use the $15 Amex credit.
Another thing, for rides to the airport Uber charges me an extra hidden fee which Lyft never charges. Same airport, same origin location.
When pricing is opaque, customers will and should presume trickery.
From now on I will load gift cards after a ride, not before, and only one card at a time.
Uber needs to nip this in the bud with a strong public promise before major damage is done to its brand.
FWIW, I got a good price last week even with a balance of $100 or so. This week the price was higher but the wait was so long that I canceled (for free).
My other gripe with these services is that they consistently lie about when you will be dropped off. If the timing is at all close to their estimate, you should cancel and find another way. As I just did.
This is not surprising. Uber practices both “price discrimination” for passengers and “wage discrimination” for drivers. Where they charge passengers the highest the algorithm says they will accept and pay drivers the lowest they’ll accept. Just google “Uber price discrimination”. There’s plenty of reporting about and even some academic research papers
If this happens to anyone in CA, screenshot the evidence (price it on 2 phones) and file a complaint with the CA AG. They have strict gc rules and this amounts to a fee for using the gc which is illegal under CA law.
Yes, Uber will “maximize” both the customer & driver payments.
The best way around this is to only use your Uber account sparingly (for rides, UberEats restaurant prices/promos tend not to change, and only brand new accounts get the good blanket discounts anyway). Similarly for drivers, I’ve heard from various drivers that if they don’t drive for a while, Uber will give them lucrative promos to start driving again. It’s harder for drivers to game this, but as a passenger, you absolutely should set up multiple uber accounts. This requires different phones (and phone numbers) however.
My favorite example of Uber gaming the system is selecting different airline drop-offs for the airport. The drop-off spot is the EXACT SAME PLACE for the 2 different airlines, but one cost $10 more, b/c it was the dominant airline at the airport. I actually haven’t seen it so egregiously priced recently, I think people wised up.
I personally don’t use Uber that much, mostly for trips to/from the airport. I also have a rough idea of what the pricing should be. I don’t see a difference between my accounts with an uber cash balance and accounts without an uber cash balance.
However I’ve been caught out when Uber knows I need a return ride, and prices it a lot higher (sadly, still lower than what a taxi would cost…).
Finally, if you use Uber a lot, you should have at least 2 accounts!
Couldn’t understand why Lyft was about $15 less than Uber the last two times I went to airport and back. Now I know why.
Uber is cheating riders and drivers. I have been driving with uber I see customer gets charged 40 and driver gets 12. This is a crime where uber makes more money than a driver just by connecting rider with a driver.
I know I discussed this with Gary months ago, but it was Lyft charging 2-3x what Uber wanted . Now that I have an Uber gift card in my account and $1200 in instacart I’ll retaliate by only ordering instacart from “ same price as in store “ places or from Costco where I know they are marking stuff up 9 pct if I link my Costco account. I can also check the instacart price v ordering. Y mail from the Costco site. My retaliation started with ordering 500 Powerade zeros from Kroger when instacart was only marking it up from 77c to 88. They only delivered 50 but it was worth me not going to the store
I encountered this situation 3 months ago and contacted Uber support regarding the lack of pricing transparency after noticing the total price was the price displayed in the app + my $15 credits. Here’s what they said: “I have checked the details and would like to inform you that this is a new feature, in which if you have any Uber Cash balance in your account, then you will be shown the remaining charge of the trip and it will be applied to your default payment method.”
It definitely seems like they’re discriminating the price based on the Uber Cash balance, or at least making the pricing less transparent which feels misleading.