Will Uber Bring Cheaper Rides?
As ride sharing service slashes rates, Milwaukee Common Council mulls changes in rules.
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.’”
“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.