Uber Announces Surge Pricing on New Years Eve—No One Gets A Free Ride.

Uber is the on-demand private driver service that’s now in 19 cities in the U.S. and Europe, and has taxi companies shaking in their boots. You can request a ride from a Black sedan (Town Car style), SUV (Escalade style) or Taxi, at any time using an iPhone or Android app. Before you know it, a private driver arrives at your location. And because everything is managed over the app, you don’t need to pay or tip the driver directly. Your credit card on file is billed automatically the second you arrive at your location.

Sound like the perfect plan for ringing in the New Year in style?

Well, Uber knows from past experience that demand on New Years Eve is tremendous. There will be many sleek black Uber cars on the streets of San Francisco, New York, Amsterdam and Paris this year. Uber knows that on New Years Eve, their service gets over burdeoned every year. So, since demand is highest between  8:30pm - 9:45pm and 12:30am - 2:45am on New Years Eve, Uber will be increasing its prices “in order to maximize the number of cars on the road during peak times.” A notice was sent out to customers in San Francisco, for example alerting riders that the average NYE price multiplier is 2X. During extreme spikes an Uber rider could expect a $100 minimum fare in addition to mileage and time charges. Prices will decrease when cars become available. They say they do this to make sure Uber is always a reliable ride. Customers, they say, will be informed of any price increase prior to booking a ride.

While none of us like the idea of a $100 minimum fare (the regular minimum is $8) I think Uber is on-brand and customer-minded by alerting customers to the price hike in advance, and using a supply-and-demand thinking when creating their pricing structure.

They have a bunch of NYE tips in a blog post and are making their executives available to talk about their surge pricing in a live Q&A on Monday, December 31st.

It is nice to see they’re being transparent, and being clear that no one gets a free ride.

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