In what world would that make business sense?
Apparently they already lose money (counting marketing costs and incentives) per ride, how can they expect to operate a going concern by striving to increase expenses?
Apparently they already lose money (counting marketing costs and incentives) per ride, how can they expect to operate a going concern by striving to increase expenses?
If you take care of your drivers, they will want to drive for you more frequently, and your rides will have more drivers available. Sure, the price of rides will be a bit higher, maybe a lot higher, but it'll be sustainable.
And here's me speculating... there's only one case where lowering driver pay makes sense, and that's lowering your prices to drive someone else out of business. If Uber is facing so much competition from Lyft & others, they won't be around once people get sick of giving them money. And by pissing off their drivers, they're creating a spot in the market for a higher end competitor to come in. Once a socially responsible, fair trade competitor gets established, it'll be hard for Uber to raise their rates again, because they have a bottom of the barrel reputation.
Of course I'm not in charge of running a ride sharing company, and there are plenty of people who have good intentions at suck at business. Maybe I'm one of the people that naturally walks the path of good intentions that leads straight to hell. Who knows.
My guess is Uber has actually done enough legwork and figured out that contrary to these sob stories in the press, there are more than enough drivers that 1) have efficient vehicles that are cheaper to operate and 2) are willing to work for that profit in quantities to cover demand.
If the rates Uber is providing drivers are so dismal they're protesting in the street, frankly, they should quit. No one is forcing drivers into a money-losing proposition. I'm especially unsympathetic given that they're paid on a per-transaction basis and there are alternative ridesharing companies out there.
Those drivers can go work for a company that charges more for rides, and passengers who care about that can choose that option. The fact that passengers currently seem unwilling to pay for that (somehow we never consider it "socially responsible" that passengers are provided cheaper service...) makes me think that will be unlikely in the short term.
Source: white middle class male in San Francisco couldn't get a job for most if 2009, eventually ended up homeless.