While Uber Australia was busy encouraging people to order “live” emojis on Thursday in the ride-sharing app’s latest publicity stunt, the US tech giant was sending a very different message to its UberX drivers in Brisbane, Noosa and the Gold Coast, where fares were cut by 20% today.
The company hopes to build market share and previously made similar price cuts in other capitals before. A Queensland parliamentary inquiry is currently investigating the service, but not due report until the second half of 2016.
While the ridesharing service has been legalised in NSW and Canberra, it remains illegal in Queensland.
Uber claims that despite the cut, its drivers will be better off, saying that when it reduced uberX prices in Perth and Melbourne last year, increased demand saw drivers make more money and hourly earnings increase.
It says it will review prices over the coming month, especially if drivers are not busier and has guaranteed gross hourly earnings during busy periods over the next month, but did not specify when those periods are.
Despite the cut in fares, UberX is best known for surge pricing – when fares increase by a multiple of the base rate, often making a private car more expensive than a regular taxi.
Here’s what the company says about its 20% cut:
After 22 months in Queensland, Uber has learned that one of the best ways to increase driver-partner earnings is to boost demand for rides. And one of the most effective ways to boost demand is to cut prices for riders.
So today Uber will begin trialling a 20% reduction in uberX prices to get more riders on the road taking more trips, and in turn increase driver-partner earnings.
But the change has not got down well with some UberX drivers, with Fairfax Media reporting that a number are threatening to turn off the service on the weekend in protest.
While Sydney UberX drivers work on a $2.50 base fare, and $1.45 per km and $0.40 per minute rates, the Brisbane base fare is now $2, with $1 per km and $0.35 per minute costs.
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