Business

Uber begins undercutting taxis in New York with 20% price drop

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Image Credit: Uber

Updated 12 p.m. with comment from Uber confirming that drivers are now paid less per ride in New York.

Uber today announced that it is “now cheaper than an NYC taxi,” after lowering fares in New York by 20 percent.

As we wrote last week, Uber is no stranger to price cuts and hikes. In April, it raised the price of its mid-level service in New York, and in June it lowered prices in LA. Most recently, Uber cut the price of its UberRush bike courier service in New York. Now UberX, Uber’s low-end car service, is marginally cheaper than New York cabs, as detailed in the graphics below:

Screen Shot 2014-07-07 at 4.50.35 PM

Uber states that the current prices are “only in effect for a limited time.” This warning somewhat alludes to the common monopolistic strategy of dropping prices and raising them back up after achieving market control — a strategy recently suspected of Amazon.

“The more you ride, the more likely we can keep them this low,” Uber says. In a statement to VentureBeat, Uber confirmed that New York drivers will make less per ride they provide: “NYC drivers will continue to earn up to 80% of the lower fare,” the company said.

More information:

Uber Technologies Inc is known as Everyone's Private Driver. Uber operates an on-demand car service used all over the world. With the touch of a button from your phone, you can experience your own private driver. Sign-up quickly, get p... read more »

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