How to avoid Uber surge pricing when searching for a ride on Halloween | Business News

How to avoid Uber surge pricing when searching for a ride on Halloween

31 Oct 2015 | Author: | No comments yet »

How to get around Uber’s surge pricing.

Users know that Uber’s surge pricing is in effect when ordering a car from their smartphone and their app reports: “Demand is off the charts! It’s not a trick but it’s not really a treat either: Uber is warning its customers they may have to pay more if demand for a ride is greater than the number of vehicles available on Halloween.

During busy times, such as rush hour or holidays, the company enacts surge pricing — something that can be beat with a few simple strategies, according to a new study. Fares have increased to get more Ubers on the road.” But it doesn’t always work that way, according to researchers at Northeastern University who studied the car-hailing service in New York and San Francisco.

The study also cited anecdotal evidence of “collusion.” That is when drivers in a specific area purposely go offline to set up a supply “shortage,” which in turn creates a price surge. But researchers Le Chen, Alan Mislove, and Christo Wilson found that while surge pricing – which updates prices every 5 minutes – is responding to supply and demand, it isn’t working exactly as Uber intended. They then tested their methodology on a publicly-available database of New York taxicabs, eventually combining their own Uber data with the company’s studies and publicly available data. Uber argued the researchers’ findings didn’t show the full picture. “Contrary to the findings in this report — which is based on extremely limited, public data — we’ve seen this work in practice day in day out, in cities all around the world,” Uber spokeswoman Molly Spaeth told ProPublica in an e-mail. Compared to San Francisco, Manhattan’s density was an advantage for Uber riders, as its smaller surge areas meant shorter walking times to cheaper rates.

Part of the issue, the researchers say, is that Uber has manually divided many cities into distinct surge areas – Manhattan has 16, London has 19, Boston has 9 – where prices are set independently of each other.

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