With Metro’s coming maintenance overhaul, SafeTrack, and the accompanying end of late-night weekend rail service, Uber and Lyft users may be wondering what will keep prices from skyrocketing.
Lyft dubs its version of surge pricing “Prime Time” but the meaning is the same: cranking up fares at times of high demand. You might notice it next time you’re trying to hail a ride in the rain or at a bar around last call. The app might prompt you to confirm that you’re willing to pay the higher rate.
Just this week commuters found out what the ride-hailing companies plan to do to mitigate the effects of surge during SafeTrack: nothing.
Unlike the January blizzard and the March 16 Metro shutdown, the companies say they will not impose a cap on surge pricing during Metro’s yearlong maintenance overhaul when usage is expected to increase. It’s supply and demand, say the companies, which are already under pressure to beef up their supply of drivers to fill the void as Metro riders seek other options.
Lyft said this week it will not be capping “Prime Time” during SafeTrack, which is set to launch Saturday with a 13 days of continuous single-tracking from Ballston to East Falls Church. Cranking up the price is the most effective way to move drivers when and where they’re needed, and make sure that passengers get rides, the company said.
Uber struck a similar chord last week, saying it sees surge pricing as a vital tool.
(Washington Post owner Jeff Bezos is an investor in Uber.)
“We find that surge pricing is a really helpful tool in ensuring reliability,” Uber East Coast general manager Meghan Joyce told reporters outside the company’s D.C. headquarters last week “It means that those times when many of us would rather be at home in bed like a rainy Saturday night at 2 a.m., the drivers have incentive to get out on a road when they’re needed and the riders can get a ride when they need it as well.”
It’s worth noting that SafeTrack and Metro’s emergency shutdown are beasts of a different nature. The one-day shutdown was systemwide and threatened to paralyze traffic across the region. SafeTrack’s surges sometimes entail single-tracking over only two stations, but they’re expected to create ripple effects down the lines — and likely severe ones. A June line segment shutdown from Eastern Market to Minnesota Avenue and Benning Road, and an October one from NoMa to Fort Totten, may be indiscernible from the March 16 shutdown for commuters in those areas.
Uber said last week it was investing $10 million in ensuring affordable rides and guaranteeing that there would drivers on the roads where needed. Lyft said this week it had invested $15 million in its D.C. operations this year, partly to do the same. So the question was asked: if drivers are receiving incentives — including location-based bonuses for drivers targeting surge areas — why would surge pricing be needed?
“We find incentives can also be a helpful tool as well to ensure that drivers know when rides are needed and where they’re needed,” said Uber’s Joyce. “We’re open to using whatever tools it takes to ensure that people can get affordable rides when they need them.”
Uber and Lyft’s decisions to cap surge pricing during the January blizzard (Lyft scrapped it altogether), seen by many as an act of goodwill, were actually part of the regulations binding local ride-hailing services.
“(13) During a state of emergency as declared by the Mayor, a company that provides digital dispatch that engages in surge pricing shall limit the multiplier by which its base fare is multiplied to the next highest multiple below the 3 highest multiples set on different days 15 ENROLLED ORIGINAL in the 60 days preceding the declaration of a state of emergency for the same type of service in the Washington Metropolitan Area;
Translation: Uber enacted a surge cap of 2.9 times the usual fare because a state of emergency was declared. In March, during the Metro shutdown, the company decided to impose a cap of 3.9 times the normal fare, but due to lighter-than-expected traffic, the prices didn’t reach that high for most. Uber said its average surge that day stayed below 1.7 times the normal fare.
As for SafeTrack? It’s clear that many commuters will turn to Uber and Lyft — especially with the end of Metro’s late-night service. Lyft said this week it already gives 72 percent more rides than normal during the three-hour period from midnight to 3 a.m. on weekends; that was before Metro’s late-night service ended.
For many riders, who are used to paying Metro’s “peak fares” for late night service, surge pricing could become the new normal.