Who’s Still Driving For Uber After The Latest Rate Cuts?

Who’s Still Driving After The Latest Uber Rates Cuts?

For the third straight year in a row, Uber has slashed prices of fares. The winter season typically brings with it a decrease in business, from retail outlets to cab drivers, so it’s no surprise that companies like Uber would cut costs to save money. Although lower uber rates are better for riders, the same cannot be said for drivers who are trying to earn a decent income to support themselves and their families.

I would say that I’m an understanding person. I tend to take life in stride, just let whatever comes my way roll over me. It’s a fairly stressless existence, but sometimes there are things that just irk me. I’ve wanted to write about Uber rates and its system of price cuts for some time now, but I couldn’t justify going on a rant until the time was right. Now that Uber has slashed its prices for the third year in a row, I have just a few things to say about Uber drivers and what they’re going through.

 

More Drivers, Less Money

Uber’s ranks have been growing steadily over the past few years. As the company has gained in popularity, more and more drivers are applying to drive for Uber, and driver sign ups have soared. Drivers like the freedom that Uber brings because they can choose which trips they want to make, and when and where they want to work. Uber lets many drivers be their own boss, but policies are still in place to make sure drivers are thoroughly vetted and qualified to work as an Uber partner.

However, the increase in the number of uber rates cuts has left many without a decent amount of money for their services. Making money through companies like Uber depends entirely on the amount of demand there is for a particular service. With seasonal economies suffering from a slow in business during the wintertime, it stands to reason that Uber partners would have less work. Pretty soon, you have drivers just sitting around, waiting for a job to fall into their lap.

 

No Job Security

Uber rates cuts aren’t the only big issue for drivers – all of Uber’s drivers are considered contractors, meaning they have no benefits packages, workers compensation or guarantee of a steady paycheck. It’s a trade-off that all self-employed people have to make, but with Uber’s latest price cuts, even busy drivers may not be able to make ends meet.

Well-established drivers might just find themselves working longer hours for less than what they’re worth, which has made both experienced and new Uber drivers angry. You have Uber on the other hand that claims by lowering the uber rates, the drivers will make more. How’s that working for you Uber drivers?

For those whose livelihood depends on Uber income, the option to stay with the company may not be an option. Many drivers have expressed their frustrations by quitting. Those who haven’t quit have participated in strikes. On February 1, 2016, Uber drivers in New York went on strike at Uber’s headquarters in Long Island City, Queens. The protest drew hundreds of Uber employees in New York City, and many held signs expressing their views on the types of cuts the company is making.

Some claim that Uber is cutting fares for drivers without dipping into their own share of the profits. When Uber first started out, the commission rate was only 10%. Eventually, it increased to 20%, and Uber is now seeking another 5% increase on new drivers. Meanwhile, Uber is claiming that the fare price cuts have increased drivers’ profits by 20% due to a higher volume of riders. While some drivers are happy about the increase in business, others plan to stop working with Uber to seek other opportunities.

 

Coming And Going

The question now is: who’s left driving after these uber rates cuts? As if a 15% cut wasn’t enough, some cities are seeing an astounding 45% price cut for winter. Cities like Detroit have seen Uber slash its prices so much that drivers don’t have money to cover their fuel costs. One Detroit driver complained that he felt like he was “working for free.”

These cuts come at a time when Uber is planning an expansion into countries like China and India, as well as Southeast Asia. Uber is already present in countries other than North America, but the United States is still the big moneymaker out of all of them. Still, the plans for expansion amidst a chorus of outcry over price cuts seem to be in poor taste. India, for example, already has several companies that provide services like the ones Uber has.

 

Then, There’s The Competition.

Lyft has also lowered its prices for fares in the last year to stay competitive in the new gig economy. Drivers who have considered switching to Lyft to increase their earnings are finding out that the grass isn’t greener on the other side. A competitive market that sees its companies cut prices and increase demand may soon buckle under the strain. Some Uber drivers hope to win rights for minimum wage and be considered official employees of Uber, while some want to organize a union.

 

A Fruitless Effort

Unfortunately for those protesting, Uber is unlikely to back down from their decision. Many have quit over the uber rates cuts and penny-pinching policies Uber has, but other contractors are waiting in the wings to take their place. These aren’t the seasoned drivers Uber has counted on for several years – the ones that are adding their names to the list of available drivers are new to the gig economy. Many are unaware of previous price cuts and actions taken by Uber.

Frankly, no matter what volume of drivers quit the business, there will always be those willing to participate in a gig economy that is turning into a “race to the bottom.” As uber rates lower, drivers will have to work longer hours to keep up with expenses, many of whom have car payments for vehicles that were purchased to provide Uber services. The endless cycle has to stop somewhere, but it certainly seems like Uber and other companies like them are spiraling toward rock bottom, and it’s unlikely to stop before impact.

I don’t know about you guys, but it seems to me like Uber is screwing a lot of hardworking drivers out of decent pay. Being self-employed or working in a rideshare business is supposed to make you more independent, not drag you under a tidal wave of debt. Uber claims by lowering the uber rates, the drivers will make more, so why increasing their “ride fees” by 90% instead of lowering them?

 

 

  • YSii Showroom

    love this driver. He’s fantastic!

    • RideOrDriveUber

      Thank you… You’re a great one too, but with the fare cut it’s a rare thing to do nowadays lol

  • PumpToDump

    I am very upset about the whole Uber thing too. I am ready to quit. The rates are much better in CT, going there today.

    • PumpToDump

      Who wouldn’t be upset with those ridiculous rate cuts? It’s unbelievably cheap here in Tampa FL, $0.65/ a mile…

  • Maddie Mahoney

    Very interesting. Unfortunate that this happened! Uber needs to get it together.

  • Jr.

    People have been saying this is a race to the bottom all along but Uber lovers defend this company to the death for some reason. There’s only one way these companies continue to survive and that’s if the driver pool never runs dry. Uber’s showing how desperate they are for drivers by changing their model to allow criminals to drive in California as long as they weren’t violent or sexual crimes.
    There are a couple things in the article that need correcting. Drivers are not thoroughly vetted. The background checks are very laxed and Uber fights any regulations to tighten them up, especially fingerprinting. Austin has been trying to implement fingerprinting because of 27 sexual assaults in 2015. 5 by taxi drivers and 22 by rideshare drivers. Uber will win that battle. Uber was sued by DA’s because Uber was claiming that they were setting the standard for background checks, claiming their checks were more stringent than regular taxis. You haven’t heard that for awhile because it was part of the settlement that they couldn’t lie to the public any longer. For a company that touts safety the way they do, claiming their rating system doesn’t allow for bad stuff to happen, it seems their system has some very serious flaws.
    It’s also a myth started by Uber that the winter months are slow periods and that’s why they need to cut rates. Winter has always been the busy season for any transportation, especially taxi businesses. People don’t like to walk, or stand at a bus stop or what have you in the winter. Uber is lying about winter being their slow period, but then what hasn’t Uber lied about.

    • RideOrDriveUber

      @ Jr. I have to agree with that Winter had nothing to do the rate cuts, and that Uber simply wanted to drop their prices. I mean, here in Florida, it’s busier than ever during winter season, I don’t see why Uber had dropped the price to 65 cents a mile. In fact, we have the best weather here in Florida during Winter season, more people going out, as you stated it’s clearly a myth.

      • Jr.

        Yes, it makes no sense whatsoever for prices in Florida to drop because it’s winter as that’s when you would have many tourists.

  • ZoZzo

    Drivers man-up and unite: Stop Uber for Super Bowl Sunday in solidaroty with our SF colleagues. More fare cuts are coming for the game. Spread the word by all means possible. We are not gonna die for not driving – but we can make history and hit hard at Uber’s pocket. Lets all watch the game by ditching Uber.

    ZoZzo from Wash., DC

    • RideOrDriveUber

      It would be nice if all drivers could boycott Uber on Super Bowl, but we both know it’s not going to happen.

  • ZoZzo
  • WESHARERIDE

    I’m not surprised to see many drivers are still driving for Uber. Many of them are brand new drivers, they don’t really know how it was before the price cut. Drivers like us who’ve been driving for a longer period of time may see this big difference clearer than them. I don’t think Uber will ever be short of drivers, even us can still make money driving for Uber if we do it smart. Great post by the way!

    • RideOrDriveUber

      @weshareride, sooner or later new drivers will realize that driving for Uber is not worth it. You’re probably right, there will always be drivers for Uber, but they won’t stay for long when they realize driving pax around for 30 to 65 cents a mile just won’t do. Thanks for stopping by.

  • Chad

    Listen , you are a self employed entity you drive for Uber . Being so you need to manage your costs and expenses based on your income being generated . If you don’t know what it costs per mile for expenses like fuel and vehicle maintenance vs what you earn per mile than you have no business being self employed! If the ends don’t justify the means then you don’t do it . Ridicules article . Complain about not making enough money to cover your expenses.. LOL. You have the option to not drive !

    • @Chad, I disagree with your statement “you have have the option to not drive!” Not everyone has a choice, to some it’s the only gig to support their family… I’d rather make minimum wage and in some cases less than minimum than NOTHING at all… Anything to support my family… I understand it’s easy to say not to drive, but that doesn’t fix the problem, we must address it, not running away from it…