Uber Technologies is testing a new driver earnings algorithm in 24 US cities that allows drivers to view payments and destinations before accepting a ride, while increasing driver motivation to take the ride. short in an attempt to attract more drivers.
The changes, which are currently in beta, mark the most extensive updates to Uber’s driver-pay algorithm in years and come at a time when the company is still trying to win back drivers. The driver left when the pandemic broke out. Fares paid by consumers are not affected.
Drivers have long asked for the ability to view fares and destinations before accepting a ride, but Uber declined, saying it could open the door for drivers to choose cherry-picked or differentiated rides. treat drivers in difficult areas.
Uber already has a similar program in California, launched after a state battle in 2020 over the right of contract workers to prove their drivers are independent contractors.
But the company says its latest fare test in the United States has nothing to do with employment contract regulation. Testing has been rolled out in cities across Texas, Florida and the Midwest, where contract reforms are not on the agenda.
“Gig’s work is very competitive, not only with Lyft but other platforms, and we think this feature really enhances our platform’s competitiveness over others,” said Dennis Cinelli, Uber’s head of mobility in the US and Canada said.
Cinelli said wage changes at this point would not affect consumer prices, adding that the changes were “not of a financial character.”
Uber declined to comment on the financial impact of the changes on the company, which could mean it incurs higher costs for short rides.
Cinelli said the company hasn’t seen any driver discrimination in California since the policy was introduced there in 2020.
“Otherwise, we wouldn’t be rolling out this feature at this time,” he said, adding that Uber has the ability to deactivate drivers who repeatedly turn down rides for racing or collection reasons. low input.
Cinelli said providing drivers with upfront details means the company has to reduce earnings on longer trips to prevent drivers from avoiding short trips.
Uber says data from a number of prepaid cities has shown a 22% increase in driver earnings on average for trips where the distance to the pick-up location is longer than the ride itself.
Driver feedback has been mixed on several online groups. Some complained that the new algorithm seemed arbitrary and no longer allowed them to calculate payments on a per-mile (per-kilometer) basis.
“My income has been destroyed by the high gas prices and now Uber is taking more of my money on long trips,” said Kevin Hernandez, a driver in Houston.
Other drivers in online groups said the information about the prepaid fare allows them to choose only higher paying rides, with some drivers sharing screenshots of their increased income since the ride. change algorithm is introduced.
Expansion will depend on the driver. “If we don’t see it attracting and retaining drivers, we won’t deploy any more,” Cinelli said.
