When Abby Kelley came home to Durham after spending Halloween night in Raleigh with friends, she didn’t expect to pay $432.34 for a ride.
It wasn’t until the next morning when she saw a receipt from Uber that she realized she had paid that much.
“There was no notification when we requested (a ride,)” Kelley said. “And the driver didn’t say anything to us; we had no idea.”
Uber, a ridesharing service that uses a smartphone application to connect passengers with hired drivers, has a surge pricing policy for busy times.
“Uber ensures a safe, reliable ride, wherever and whenever, and dynamic pricing allows us to remain the reliable choice, even on the busiest nights of the year,” Uber spokesperson Taylor Bennet said in an email. “Our in-app features ensure dynamic pricing is repeatedly communicated and approved before any trip is confirmed.”
Under the policy, Uber says it notifies customers in “big, bold print if surge pricing is in effect before (a passenger) confirms a ride.”
However, as of Monday, the N.C. Consumer Protection Division had received 3 complaints about high Uber pricing during Halloween, said Noelle Talley, public information officer with the N. C. attorney general’s office.
Uber has been widely touted since its 2009 inception as a cheaper alternative to taxis, but unlike taxi companies, it is not subject to certain price-controlling ordinances.
Husam Hasanin, of Durham’s Best Cab Company, said he cannot raise rates above $2 a mile, even during busy times or driver shortages.
Raising prices above this amount, he said, would break Durham ordinances and result in license revocation.
In a post on Harvard Business Review, Rafi Mohammed writes that Uber is capitalizing on an uneven pricing field.
“Uber and fellow ride sharing services (such as Lyft and Sidecar) can easily advertise big discounts and regulation-laden taxis are unable to respond,” he writes. “Conversely, during peak times, Uber can dynamically raise its prices while taxis are tied to the same static one-size-fits-all rates.”
Lyft has a similar policy to that of Uber’s price surging.
The policy, called “Prime Time,” kicks into effect “when passengers greatly outnumber drivers on the road,” according to a Lyft release.
“The Prime Time amount will vary based on demand and you will always know the percentage before confirming your request,” the release says.
According to Kelley’s receipt, the Uber surge price was 8.4 times the normal fare of $51.35, which was calculated based on the distance, time and a base fare of $1.55.
Kelley said she complained to Uber and expects to receive a 25 percent refund on the $432.34 total, but that isn’t enough for her to use the application again.
“I already deleted off my phone,” she said. “My family is never using it; my friends are never using it.”