Uber to review South African price cuts

Internet ride-sharing app Uber will decide on June 6 if it will keep its winter price cuts or hike fares again.

Last month, the company cut UberX fares by up to 20% in Johannesburg, Pretoria, Cape Town and Durban to try boost demand during the quieter winter period.

Uber said the move was designed to bolster its driver-partners’ earnings and that the company would offer “minimum payment guarantees for driver-partners”.

Uber drivers and car owners are not employed by the internet app but rather partner with the service and take a percentage of each fare.

Several Uber driver-partners and car owners last month told Fin24 of lower earnings and longer hours owing to the price cut.

But Uber, thus far, is sticking to its guns over the move.

Uber rider sign ups vs no first trip May 2016

“As we’ve said all along, we will put guarantees in place,” Lits told journalists in Johannesburg on Thursday.

“We stand behind these price cuts,” he added.

Lits further said that Uber driver-partners have asked the service for “a definitive date as to when we’ll make a call as to whether the price cut has been a success or not.”

“So, what we have communicated to driver-partners is that on June 6 we will be communicating a decision whether prices will revert to normal price (or) will stay where they are or maybe end up somewhere in between,” said Lits.

“But by that date we will make a decision around the price cut.

“The only factor that we look at regarding the success or not of the price cut is are drivers’ earnings higher than they were before the price cut. That is how we define success of the price cut. If that’s not the case, then we would obviously look to roll pricing back,” Lits added.

Lits further revealed to Fin24 on Thursday that the service has over 4 000 partner-drivers in South Africa. Uber launched in South Africa in 2013.

Fin24

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Uber to review South African price cuts