Yes, Ubers will be more expensive due to rising gas prices
Yesour next Uber ride will likely cost 50 cents more — and soaring gas prices are to blame.
Ride-sharing and delivery giant Uber is trialling a fuel surcharge, starting March 16, to help its army of drivers cope with soaring gas prices.
According to Uber’s announcement, the new fees will range between 35 and 55 cents, depending on location and whether it’s a drop-off or ride-sharing. The entire fee will go to the driver, Uber says.
“We know prices have gone up across the economy,” Uber’s head of driver operations Liza Winship wrote on the company’s blog, “so we’ve done our best to help drivers and couriers without placing too much additional burden on consumers.”
Uber says the new gas surcharge will be temporary, “for at least the next 60 days.”
“Over the next few weeks, we plan to listen carefully to feedback from consumers, couriers and drivers,” Winship added. “We will also continue to monitor gas price movements to determine if we need to make any additional changes.”
Uber’s announcement follows soaring gas prices across the country.
According to the AAA Automobile Club, average prices for regular unleaded gasoline recently hit a record high and cost $4.32 as of Monday, up 26 cents from last week. In some areas the prices are much higher. For example, average gas prices in California are currently $5.74.
Meanwhile, consumer prices are rising. In February, prices rose 7.9% from a year earlier, the biggest increase since 1982, according to the Labor Department.
The exorbitant costs of gasoline and vehicles are responsible for much of this increase. Over the same period, the Department of Labor said gasoline prices rose 38% and new and used vehicle prices rose 12.4% and 41.2%, respectively. . Worse still: since these inflation figures relate to February, they do not fully reflect the impact of the Russian-Ukrainian war on oil prices.
“We know the unprecedented spike in gas prices and rising energy costs have affected the amount of money you take home,” Uber sent in an email to drivers. “We hope this support will help your bottom line as gasoline prices are at record highs.”
Uber drivers are not employees. They are considered independent contractors, and typically when gas prices rise, they are expected to take the hit to their take home pay as a cost of doing business.
Uber Fares: How Much Will Additional Rides Cost?
Uber says the surcharge for ride-sharing services will be between 45 and 55 cents per ride. For Uber Eats, the fee will range from 35 cents to 45 cents per order.
The surcharge does not apply to drivers or customers in New York, Uber said, citing a 5.3% increase in the “minimum income standard” for Uber drivers that went into effect earlier this month .
UPDATE: Lyft will also implement a similar fuel surcharge “in the coming days,” a spokesperson confirmed to Money on Monday.
“Given rapidly rising gas prices,” Lyft said in an emailed statement, “we will be asking passengers to pay a temporary fuel surcharge, which will go entirely to drivers. We will share more details. soon.
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