In what appears to be a strategic attempt to add more drivers to its most popular platform, the lower-cost uberX, Uber has stopped accepting new UberBLACK and UberSUV drivers in Boston.
On the night of Wednesday, Dec. 10, an uberX driver of a Nissan Altima told me he’d recently contacted Uber Boston and inquired about registering another one of his personal vehicles as an UberBLACK car or UberSUV. In an email, the driver said, a member of Uber Boston support wrote that the rideshare company wasn’t accepting new black car or SUV drivers onto its platform.
It appears Uber hasn’t been accepting new black car or SUV drivers for a while now, even as uberX has steadily become the company’s most popular – and controversial – option. “Boston hasn’t been accepting new black/SUV for almost a year now,” a “Well-Known Member” of the popular UberPeople.net forum wrote in a thread last Thursday.
On June 30, Uber Boston implemented per-minute and per-mile fare hikes on black car trips. The minimum $15 fare and $7 base charge for UberBLACK rides wasn’t changed and has remained steady since.
Weeks before Uber raised its Boston black car rates the company slashed uberX prices 25 percent, making an uberX trip nearly 50 percent less than a taxi. In a June 13 blog post announcing the price cut, Uber urged riders to take advantage of the lowered rates, suggesting uberX trips would remain cheap as long as there was high demand.
“The more you ride, the more likely they’ll last,” Uber wrote in its June post.
Two months later, Uber announced a permanent 15 percent uberX price-cut, making Uber 40 percent cheaper than a Boston cab. “From East Boston to Wellesley and everywhere in between, uberX is now the most affordable ride on the road,” the company wrote in an email to Boston users August 16.
Cheap rates – when surge-pricing isn’t in affect – have not only made uberX the most popular option, it’s forced Uber to change its marketing and recruiting tactics.
The more luxurious UberBLACK – the original private-driver service offered by the company – has taken a back seat to lower-cost alternatives like uberX and uberXL; in general, when someone says he or she is going to take an Uber, that means he or she is hailing an uberX. And as the single uberX offering has become more and more synonymous with Uber the company, sharing-economy investors have been emptying their pockets to get a piece of Uber’s $40 billion valuation.
As long as uberX stays dirt cheap (and manages to avoid city regulations), it will remain riders’ go-to option. Even though Uber says it only takes a 20 percent cut from drivers’ fares, as long as it remains relatively effortless to register one’s personal vehicle on the platform, the sheer volume of cars on the road and the number of trip requests accepted should make uberX a goldmine.
But Uber drivers have taken exception to low, low rates, insisting it’s become increasingly difficult to make a living shuttling people around in their personal vehicles for such little return. On a flyer announcing a recent global Uber drivers protest, Teamsters Local 986 and the California App-Based Drivers Association (CADA) stated:
“UBER owns ZERO cars, and employs zero Drivers. UBER makes billions on the backs of Drivers. We own the cars, we pay for gas, we pay for maintenance, we suffer depreciation, and we take ALL OF THE RISKS.”
In theory, drivers could opt to register as UberBLACK or UberSUV drivers to take advantage of higher rates. But, with uberX demand soaring, Uber has focused on beefing up supply of its cheapest and most popular product.
In cities like New York, for example, UberBLACK and UberSUV drivers were allowed to opt into a program that allowed uberX trip requests to be sent to their Uber phones. But in an email sent out at the beginning of September, Uber announced that high demand for uberX and uberXL meant black car and SUV drivers would automatically be sent uberX requests.
Here’s a shortened version of that email (see PandoDaily for the full version):
More than 1,000 partners have been using this option regularly and it has been a success: drivers who opt-in to receive uberX/XL trip requests make on average 35-50% more per hour after commission than those who do not, equivalent to $1,600 more per month or up to $20,000 per year in net revenue. While there are additional costs associated with these extra trips, the results are clear: drivers who receive more trip requests make more money, even after accounting for any additional expenses… Based on these results, starting now, all BLACK and SUV partners will automatically receive uberX / uberXL requests.
In Boston, the base fare for an uberX is just $2, with additional $0.21 per minute and $1.20 per mile charges tacked on throughout the trip. The base fare for UberBLACK ($7) and UberSUV ($14) trips, meanwhile, are 3.5 and 7 times that, respectively. But drivers looking to sign up to drive for higher rates on these expensive platforms are getting turned away.
And suddenly it makes sense why these supposedly economy-class uberX cars are always so nice.
Screenshots via Uber.
