Important Uber change in Orlando and Tampa

[JimMIA]

Just a quick heads-up for Uber "frequent flyers" at WDW.

On Tuesday, Uber made an important change in Uber driver pay in the Orlando and Tampa markets which may affect availability during busier periods.

The change does NOT affect rider fares during peak times -- surge will continue to be applied to your fares, just like it always has been.

However, Uber is radically reducing driver pay during peak times. Basically, they continue to charge the rider the normal "surge multiplier," but now pay drivers a much lower flat-fee for surge rides...with Uber pocketing the difference.

To give you an idea, under the old system a rider might pay triple during a surge, and the driver would typically get 2.5x-2.7x the normal driver pay. So, on a ride that would normally pay the driver $10, the driver would make $25-$27 on surge.

Now, the driver's flat fee may be less than $3 extra in many cases -- so $13 instead of $27.

The importance of this change to YOU as a rider is that availability is likely to be affected during peak periods like theme park closing hours.

Many drivers will choose to either not drive park closings at all, or turn Uber off and only drive Lyft (depending on what Lyft is paying). If that happens, Uber riders will pay an even higher surge and availability will be difficult.

If you find yourself at a park closing and unable to get an Uber -- or unable to get a decent fare because of surge -- there are only a few options:

• Use Lyft
• Use a Disney MinnieVan
• Take a bus
• Take a taxi

 

[joelkfla]

Wow - and everyone had thought (or hoped) things would get better after Travis left.

 

[bastraker]

Thanks! This makes my decision easy. We'll be renting a car - especially since we will be there over Thanksgiving. We usually rent a car anyway, but I was trying not to this time since we'll be staying at the Poly and figured we would be "ok" without one.

 

[JimMIA]

Wow - and everyone had thought (or hoped) things would get better after Travis left.

Things are better post-TK. But Uber is focused on profitability and an IPO in 2019. The only way to do that is to charge more and pay out less. I just hate that they did this to the lowest-paid drivers in the US.

 

[NH-to-FL]

I am sad to hear this. I have not found myself in need of Uber like services for many years but now will not consider them if the need arises. I find it disappointing that more and more companies do not share the wealth they create with the workers that make it possible.

 

[JimMIA]

I am sad to hear this. I have not found myself in need of Uber like services for many years but now will not consider them if the need arises. I find it disappointing that more and more companies do not share the wealth they create with the workers that make it possible.

Well, Uber has plenty of company in that regard, and they are probably far from the worst. All companies are under pressure to maximize revenue and minimize expenses -- that's what business managers get paid to do.

And Lyft may very well copy this surge plan if they can figure out the code -- both companies copy each other shamelessly.

Uber is not forcing any driver to take any ride. We have total control as independent contractors -- they offer us a ride, and we accept it or not. Our choice. So, to me, if a driver accepts a ride they don't like, that's the driver's bad, not the company's.

Drivers can and will adjust, and there are lots of ways to do that. But the most obvious adjustment is to drive somewhere else, rather than a WDW theme park at closing -- and that may inconvenience Disney visitors.

 

[Lewisc]

Just a quick

• Use Lyft
• Use a Disney MinnieVan
• Take a bus

Taxi is an option. Uber is defeating the stated purpose of surge pricing. New policy is price gouging.

 

[JimMIA]

Taxi is an option.

Right...fixed it above. Thanks.

Uber is defeating the stated purpose of surge pricing.

You're absolutely right!

Surge pricing is justified by the theory that it draws drivers to busy areas, thereby restoring efficiency to the system...which provides better service and lower fares. However, if you just charge more and pay drivers less, only the dumb and/or desperate drivers will drive to the busy area.

 

[joelkfla]

Drivers can and will adjust, and there are lots of ways to do that. But the most obvious adjustment is to drive somewhere else, rather than a WDW theme park at closing -- and that may inconvenience Disney visitors.

But if this applies to the entire market, driving somewhere else in the market won't help the driver when the demand is centered at WDW. It's a self-sacrificing protest. They'll just wait longer to get a call and be making the same or less. They've got you either way.

It may have an even bigger effect on the bar scene. Surge was a key reason why some drivers chose to put with rowdy drunks while driving late nights.

 

[JimMIA]

But if this applies to the entire market, driving somewhere else in the market won't help the driver when the demand is centered at WDW. It's a self-sacrificing protest. They'll just wait longer to get a call and be making the same or less. They've got you either way.

That's true to a degree, but we already run into this decision without the surge change -- does it make more sense to go somewhere else with productive rides, or stay here in this monster traffic jam and try to wade through it?

Surge or no surge (and I drive almost exclusively non-surge times and places), I have that dilemma every Friday, Saturday, and Sunday I drive. My experience has been that I do better away from the traffic jams.

There is also a technical change with the surge system itself. I don't want to turn this thread into "inside baseball," so I'll PM you about that.

It may have an even bigger effect on the bar scene. Surge was a key reason why some drivers chose to put with rowdy drunks while driving late nights.

The technical difference is what will make the bar scene more attractive.

 

[Lewisc]

I assume this being done to allow uber to introduce their monthly plan, pay a monthly fee in exchange for a small discount and no surge pricing.

 

[mom2rtk]

I assume this being done to allow uber to introduce their monthly plan, pay a monthly fee in exchange for a small discount and no surge pricing.

BLECH! I'm so SICK of every company on earth wanting you to subscribe to a monthly plan.

 

[JimMIA]

I assume this being done to allow uber to introduce their monthly plan, pay a monthly fee in exchange for a small discount and no surge pricing.

No. It has nothing to do with that. What the rider pays has no effect on driver pay -- drivers are paid purely based on time and distance. Subscription rides will still pay the driver the same -- a surge multiple in my market (so far, so good), maybe $3 in the Orlando market.

It's simply a complicated pay cut for drivers.

BLECH! I'm so SICK of every company on earth wanting you to subscribe to a monthly plan.

You can thank Netflix for that!

With Uber and Lyft, be sure to READ the small print on subscription offers. Usually they offer a free ride up to a certain amount, and you pay any excess. They're not usually going to include your WDW - Port of Miami ride for a cruise!

Subscription plans will work well for people who commute a reasonable distance back and forth to work/classes with Uber, but not for everyone.

 

[joelkfla]

Uber has announced another change in the Orlando market, which will put drivers into tiers based on how many rides they've completed during a previous time period. At some point, it sounds like riders will be able to see which tier a driver is in. Drivers in the higher tiers will receive preference in the assignment and selection of rides, and will receive a few per cent more in pay, as well as some discounts on things like gas and repairs.

This will benefit full-time highly active drivers, but IMO may discourage part time and casual drivers (including moonlighting Disney cm's) to the point of giving up.

At this time it's in pilot stage in Orlando, with about half of drivers being included.

 

[Missyrose]

Uber has announced another change in the Orlando market, which will put drivers into tiers based on how many rides they've completed during a previous time period. At some point, it sounds like riders will be able to see which tier a driver is in. Drivers in the higher tiers will receive preference in the assignment and selection of rides, and will receive a few per cent more in pay, as well as some discounts on things like gas and repairs.

This will benefit full-time highly active drivers, but IMO may discourage part time and casual drivers (including moonlighting Disney cm's) to the point of giving up.

At this time it's in pilot stage in Orlando, with about half of drivers being included.

Is Uber actively trying to make the pool of drivers smaller in that market? Good lord.

 

[JimMIA]

Is Uber actively trying to make the pool of drivers smaller in that market? Good lord.

NO. Uber depends on a huge number of drivers spread across the landscape to make the system efficient.

They have nothing to gain by drivers quitting, and driver retention is actually one of the biggest problems they have. Most drivers quit before driving for a full year, and there is a cost associated with each driver coming on board and also with maintaining a full-time staff of employees to recruit new drivers.

Uber is constantly experimenting and testing new ideas. If they work, fine; if not, they are dropped. They have numerous experiments that failed and were never mentioned again.

I'm not sure what the objective is in the test program Joel mentioned above, but I guarantee they're not trying to chase drivers away.

 

[gottalovepluto]

Wow - and everyone had thought (or hoped) things would get better after Travis left.

Maybe someone took a better look at the books after he left...

 

[cobright]

Just got back from a 5 day trip where we used Uber extensively. I gotta say, we had no issues with availability. Like ever. Single digit wait times picking up from park and DS. I don't think ever much over 10 minutes anywhere except maybe a 15 minute wait time to get pick up from Walmart.

I know this issue gets extremely partisan even among the Uber Driver community, so I don't mean to ruffle any pseudo-political feathers. But the quality of my Uber experience increased compared to previous trips, even as recently as July. Drivers and cars were better. Admittedly a statistically tiny sample size, About 25 rides in each of last two trips, to make a comparison ... but it's my experience. I also experienced driving for Uber in the Detroit market back in 2015 shortly before a similarly drastic change in payscale and structure. I'm generally inclined towards paying the drivers more even at the expense of a little higher fare.

That said... Uber rates in Orlando were some of the lowest in the country and driver pay was, and is, much better than in other markets. Uber is raising fare price 14 cents per mile and 3 cents per minute. According to one source drivers are getting a bump of 1 cent to their per mile and per minute pay. So, 7% of the increase in per mile charge and 33% of increase in base minute goes to the driver. (edited to remove a misquote)

Uber is defeating the stated purpose of surge pricing. New policy is price gouging.

Surge pricing is justified by the theory that it draws drivers to busy areas, thereby restoring efficiency to the system...which provides better service and lower fares.

One thing we learned back in 2016 is that Uber hates surge anything. They hate surge pay to drivers and, though they hate it much less, they hate surge pricing to customers. The system arose out of a need to do two things:

1. increase supply of drivers by attracting them during high demand times with higher pay
2. decrease demand by charging more. This sounds counter intuitive, but demand that outstrips supply degrades the product.

In Detroit, it was ridiculous. Nobody drove unless there was a surge. There was just no money in it. They needed to get more drivers out there working normal hours. So they raised our per mile pay a fair bit and lowered our per minute pay a little I think and in the end we got more drivers onto the road and we dramatically reduced the Surges. Put it this way, in 2015 I picked up a couple of guys from the Ozzy concert on a 13X surge. Drove them 5 miles to their hotel and made $75 on the ride. That's great for that ride. But for the rest of the time, when no one is driving through the day and wait times are huge for customers, people find other ways to cope.

What this sounds like in Orlando is Uber is still planning on using Surge pricing when needed to reduce demand at very busy times, while relying on their other driver incentive systems to increase supply when needed. The goal overall is to have a stable and predictable price for the customer. To that end, on my wife and I's recent trip, most of our trips were during traditionally high demand times and rarely had a surge multiplier. We had 1 or 2 but neither were above 2x.

 

[joelkfla]

That said... Uber rates in Orlando were some of the lowest in the country and driver pay was, and is, much better than in other markets. Uber is raising fare price 14 cents per mile and 3 cents per minute. According to one source drivers are getting a bump of 1 cent to their per mile and per minute pay. So, 7% of the increase in per mile charge and 33% of increase in base minute goes to the driver. $1.05 a mile doesn't sound like much, but in Detroit we were making 60 cents a mile.

What is the $1.05 number you're quoting? I haven't driven in a few months, but unless it's changed drastically, drivers in Orlando get somewhere in the range of $0.50 a mile. Orlando has historically had among the few lowest pay rates in the country.

ETA: I just checked: $0.53 plus some fraction of a cent.

 

[cobright]

What is the $1.05 number you're quoting? I haven't driven in a few months, but unless it's changed drastically, drivers in Orlando get somewhere in the range of $0.50 a mile. Orlando has historically had among the few lowest pay rates in the country.

ETA: I just checked: $0.53 plus some fraction of a cent.

Mea Culpa. I misread and misquoted the article. Started writing then ended up coming back and leaving several times and just laid the post out badly. Should have caught it.

The article is at ( https://www.miamiherald.com/news/business/article205383224.html ) and the 1.05 was the new fare price.

When I started in Detroit it was 30 cents a mile and 30 cents a minute. When I stopped in 2016 it was 60 cents a mile and 15 cents a minute.

One thing that stood out for me on this trip is that the quality of ride was markedly improved over previous trips. I know this sort of observation can sometimes be racist dog-whistle speak, I don't mean anything of the kind. I mean competent drivers with good customer service skills. I generally tip a dollar for every ride that doesn't scare or offend me and tip higher from there based on better service, and every driver this trip got a 3-7 dollar tip.

I pay casual attention to the Uber situation because I'm down there often enough but don't really want to buy a car to keep down there. I think there is a lot of work to make things equitable for the drivers, but what I'm afraid of is that the supposed driver interest groups will lobby a little too hard in that direction. There's already enough pressure from the cabbies. If one of these groups scores a victory and gets a minimum fair of $2.70 or $3.00 a mile put in place, then Uber will just pack it in and shut down.

In terms of driver pay, a driver can choose to work for Lyft. They pay a little more in most markets. But Lyft has fewer users on its network so drivers end up making fewer rides. That's what Uber's take from the fare is, the driver's fee to pull rides from Uber's network. There's no comparison, Uber has a more valuable network, it should cost a driver more to use it. How much more, and with what protections for basic worker rights and safety is a more complicated question. I personally would like to see Uber give a little more and then let the market handle the rest. But perfect worlds are hard to find.