Uber trips will cost less in 100 cities in 2016 under a new pricing structure announced by the company.
Uber said it is offering the price cut to boost ridership in typically sluggish winter months.
“It’s January, and for most people that means bad weather, staying in, and saving money,” the company wrote in a blog post on its website.
{mosads}”Yes, seasonality affects every business, and Uber is no exception because when people hunker down at home, demand for rides drops,” the post continued. “Fewer trips are tough on drivers, many of whom want to save money and pay off their holiday credit card bills now that January is here.”
Uber said its research has backed up the assertion that passengers are less likely to hail rides in winter months.
“Five and a half years in, we’ve learned that the single most effective way to boost demand during the winter slump is to cut prices for riders,” the company said. “Starting [Saturday]—just like last year and the year before—we’re cutting prices in more than 100 US and Canadian cities, giving riders one more reason to head out of the house, ditch their keys, and avoid parking.”
Some Uber drivers have complained that the price cut will impact their profits, but the company said the increase in passengers would make up for the reduced travel price.
“Higher demand means more time moving people, less time spent waiting around and more money for drivers,” Uber said. “And if drivers aren’t busier, prices will go back up again. In addition, we are guaranteeing earnings for drivers to ensure that no one is disadvantaged. That’s 24/7 incentives to put drivers at ease.”