>the competitors are having a hard time because Uber can keep undercutting them

They keep undercutting Uber, should Uber ignore that? Besides, Uber doesn't set prices significantly below the competitors, it relies on being a superior service with lower wait times and higher vehicle utilization. If you open Uber and Lyft you will typically see very similar prices, with the main difference that Uber can be lower because they are a more efficient service, but Lyft will make up for this by subsidizing rides even more than Uber (something you can see very clearly in their S-1 and quarterly earnings reports).