Bruce Murphy
Back in the News

Will Uber Bring Cheaper Rides?

As ride sharing service slashes rates, Milwaukee Common Council mulls changes in rules.

By - Jul 14th, 2014 11:42 am
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Brandon Knight who was rider zero in Milwaukee.

Brandon Knight was Uber rider zero in Milwaukee.

The revolution in alternatives to the taxicab, which we first reported here, continues across the nation and beyond. The ride sharing service Uber recently announced it will slash prices for its UberX service in dozens of cities in the U.S. and abroad, as the New York Times has detailed. UberX is the company’s cheaper, more entry-level transportation offering, versus its Uber Black service, which uses licensed limousine drivers and more deluxe cars.

“The price cut amounts to 20 percent in New York and 25 percent in San Francisco and Los Angeles,” the Times “Upshot” columnist Neil Irwin notes. “By the company’s math, that leaves the price of a ride lower than that of a taxi in New York, and in other cities the price is now significantly lower.”

“Essentially, Uber is betting that lower prices will induce people like me to use the service far more often — for the commute to and from work, to business meetings during the day, and so on,” Irwin writes. “‘The whole point of price cuts is to get UberX pricing below the cost of owning a car,’ Uber’s chief executive, Travis Kalanick, told me. ‘Let’s say you take three or four trips a day on average. If we can get the price of UberX low enough, we can get to where it’s cheaper to take Uber than to own a car.’”

As for Uber’s competitor Lyft, it “seems to be inching away from some of its warm and fuzzy, friends-giving-a-ride-to-friends, Kumbaya elements, which both differentiate it from Uber and make it less primed to be used for the full range of trips, including business travel,” Irwin notes. “Its New York cars will eschew the giant pink fuzzy mustaches normally placed on Lyft front grilles, as will a new high-end S.U.V. service it is experimenting with in San Francisco.”

“The market for rides will be cheaper, with more availability of cars, than it ever has been before,” Irwin predicts. “Whether from Lyft, other new entrants like Sidecar, or even from traditional taxi companies improving their pricing to compete, it is clear that this is going to be a brutally competitive arena.”

The Milwaukee Common Council is still considering a proposal backed by Ald. Bob Bauman to provide some controls over the ride sharing services, which we reported here.  His proposal now has nine co-sponsors. The full council will meet July 22, when it is expected to amend or approve Bauman’s proposal, which will likely include eliminating any cap on the number of taxicabs in the city.

The ease of using ride sharing services has resulted in an 11 percent drop in drunk driving violations in Philadelphia, Streetsblog has reported, with most of the decline coming in violations by those aged 30 and under.

Meanwhile, the mayors of both Atlanta and New Orleans have predicted that Uber will ultimately win out in the competition with the traditional taxicab industry. Certainly for Milwaukee, which has long been one of the worst-served cities when it comes to taxi availability, the ongoing revolution could transform its transportation scene.

Categories: Back in the News

11 thoughts on “Back in the News: Will Uber Bring Cheaper Rides?”

  1. PMD says:

    I don’t really know much about Uber. I’ve never used it and I don’t know anyone who has. My wife recently took a cab from Shorewood to Glendale, and I was curious if Uber or the cab is cheaper. According to the fare generator on Uber’s site, the taxi is cheaper. My wife said it showed up a few minutes after being called and was very clean. Of course that’s just a single anecdote.

  2. npatter says:

    I have used Uber a handful of times now since last weekend. Not only was it cheaper than a taxi, the driver actually spoke to us and carries on a conversation. The cars were also very clean.

  3. PMD says:

    So are rides in the city cheaper than in the suburbs? How much cheaper was Uber compared to a taxi in the instances you used it?

  4. Andy says:

    Stan, your problem with Lyft and Uber is the threat of breaking the monopoly your industry has had and the corruption behind the scenes to maintain power isn’t powerful enough to fight the popular uprising against the crappy taxi services in cities across the country.

  5. npatter says:

    Just for sh!ts and giggles, we took Uber to Summerfest from Shorewood, and a cab from Summerfest back to Shorewood. Uber enderd up being a full $10.00 less. We did the same thing to a wedding downtown this past weekend, and Uber still ended up being $10.00 or so less than a cab.

  6. PMD says:

    Maybe the fare generator on their site isn’t accurate, I don’t know. Oh well.

  7. Larry Best says:

    Uber drivers communicate at this independently created forum – http://uberpeople.net

    Loads of info straight from the source of the drivers around the world.

  8. partypanther says:

    Anecdote: I took a cab from Water and Chicago St. to the North end of Bay View around 1am after Summerfest and my fare was $7.50 plus obligatory $2 tip. I took an UberX this past Saturday from the same location at the same time of night with similar traffic and my total was $5.33 without an obligation to tip. I don’t really prefer one method over another–cabs are bigger and the drivers are more hit-or-miss in regards to driving style and whether they’ll talk to you. I’ve had three UberX drivers now and they’ve all been very nice and polite, however their cars are definitely a bit smaller(although sometimes nicer).

  9. Paul Miller says:

    I’ve used Uber in Chicago, where I live currently. In my experience, the drivers are more professional and courteous (for instance, they don’t talk on their cell phones the whole time). The pricing varies because Uber rates go up a bit at peak times, so there a demand element. Of course, in Chicago it can be faster to street hail a cab in many areas, unlike Milwaukee, where most of the time you need to call. So if anything, that makes Uber even more attractive as a comparison choice in Milwaukee versus a cab.

  10. T says:

    If you are in an Uber or Lyft vehicle as a passenger, are you covered by insurance if you are injured in an accident? I know cab companies are required to have such insurance.

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