Uber is lowering its prices in 48 U.S. cities. Unfortunately, it's all cities that Uber is relatively new to, so Washington, D.C., Boston and Chicago are not on the list. The new price cuts bring the cities closer to the prices in its earlier markets, which saw permanent price cuts in the fall. Uber may not have planned its price change to come at the same time as the ridiculously cold weather hitting large parts of the country, but it definitely won't hurt it for people to decide that the cheaper prices make it worth getting a ride to avoid frostbite. And D.C. may not be on the list of cities getting cheaper Uber rides, but anyone traveling to Baltimore, Richmond or Hampton Roads should be happy.
In D.C. and in Boston, Uber dropped prices by 15 percent, but there's no reason to think that will apply universally. But while price cuts normally make drivers grumble about losing income, Uber is taking the unusual step of promising that the lower prices will actually boost how much drivers earn. More rides and more demand from lower prices translates into more money for drivers according to Uber.
"In the past, Uber has implemented price cuts without a guarantee for drivers," Uber wrote in a blog post. "However, this time around, we're trying a new approach. We’re so confident in the earnings gains drivers will see that we’re making earnings guarantees in every city where we're cutting prices. We feel that it is important for drivers to have this kind of certainty and comfort going into a price cut."
And Uber claims its data backs it up. The company put together charts for New York and Chicago to show how the cheaper prices actually increase driver earnings. Chicago is the cheapest place to use Uber, so presumably Uber believes if this is how price cuts work there, it will apply anywhere.
It probably isn't a bad idea for Uber to earn some goodwill after its recent public relations catastrophes too. But get ready to see plenty more taxi company protests, which seem inevitable if Uber lures in new customers.
