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Comment by npace12 | Hacker News Reader

Last year, I traveled from DC to NY overnight, and it was 2.5x surge pricing. When i got to my destination, I stuck around in the car to see what the driver app was saying. I paid close to $900, driver took ~$250, the entire surge pricing difference went to Uber. I was thinking, that's an crazy markup over their AWS bill but really it's just a robbery.

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Greyhound nyc to dc is like $20 and has a dozen buses a day. Plus you have Amtrak. Why take an Uber?

I would also like to know this. Even a flight would have been cheaper!

Or even renting a car one way!

speed would be my guess. Especially at night. Everything else from renting to even trains is slower and harder to coordinate.

I live in Japan but was thinking of taking a Greyhound for a 2-hour or so ride during a US trip but a friend strongly advised against, the presumably exaggerated analogy was getting herpes just riding it. Another friend more familiar than me with the recent US generally concurred.

So I assume that's one reason to take an Uber? I was going to look into a charter anyways based on that advice.

Amtrak I'm more familiar with but at least in California it's just incredibly slow.

Greyhound is cheap, so yeah you are getting more poor people riding it. I would say its generally fine. I've ridden it dozens of times and never had issues, at least in the north east. Its usually the most cost efficient way between two cities that are nearish. The one hiccup in the north east is often that its hub and spoke which might take longer. If you are going from one small city to another small city, you are probably going to go to nyc first.

My flight got diverted due to some issue in EWR and landed in DC around midnight. There were no other flights that night and no amtrak until the morning. I didn't even think to check Greyhound. I just wanted to go home to see my kids before they head to school.

Because with those other services, you have to be around other people. Americans hate that.

Amtrak at night is quiet, generally pretty empty, and very civilized. Nothing at all like an intracity bus or subway. But I think many Americans would never even give it a chance. Maybe that's why it's so nice...

I've tried to give Amtrak a chance. But I don't live in the northeastern part of the USA. So I would have to drive a few hours to get to a train station, then spend 24 hours longer on the train than I could drive in a car. And it would cost me a lot more to ride the train than to drive myself.

I think there is more than one reason that Americans "never give it a chance".

Well I'm talking in the context of the NE, I'm well aware that the routes are sparse elsewhere. Amtrak is very good for DC to NYC but most Americans wouldn't give it a chance even in this context.

The main issue with Amtrak is the delays. Freight is prioritized over passenger trains on a lot the lines so you can quickly fall behind schedule. This is compounded over the distance so can add up.

If you don't need to be at your destination for a particular time then Amtrak is nice a way to travel if the route works, especially if you get a cabin.

No? Lots of "Americans" use Amtrak and buses. Not sure why you have to denigrate Americans as being uniquely hating being around people.

Is that really the cost or figurative? Because I would take the bus from NYC into PA and it was like $70 twenty years ago.

$20-30 is the code nyc to dc. Philly to nyc was $11 before the pandemic, might be more more now.$70 sounds more like state college or Pittsburgh. Greyhound is you’re only hitting major cities in the north east is super cheap and fast

Highly depends on when you buy the ticket and which bus line.

About 15 years ago I took a bus from Philly to DC and it cost $5.

No amount of the surge pricing should go to Uber. They're already earning more due to the increased number of rides. It's almost akin to taking the tips.

I don't understand why people think this. Uber isn't a charity. Of course they are going to try to take advantage of demand shortages.

If drivers want to take in the profit from things like this, they should form a co-op, not be contractors.

The original (stated) point of surge pricing was to encourage more drivers to start work because of higher rates.

It says this on the Uber website:

> In these cases of very high demand, prices may increase to help ensure that those who need a ride can get one. This system is called surge pricing, and it lets the Uber app continue to be a reliable choice.

The fact that only a fraction of the fare increase goes to the driver is misleading at best.

https://www.uber.com/us/en/drive/driver-app/how-surge-works/

It sounds like they are saying - we increase prices so that less people use the app so we can service all the people who do.

It is only a misleading statement if you put words in uber's mouth beyond what they say. I don't see anything here suggesting they increase prices to increase supply instead of decreasing demand.

Your interpretation is far too generous to Uber.

> prices may increase to help ensure that those who need a ride can get one

Why are you using the app if you don't need a ride? I agree that it's purposely vague, which makes it intentionally confusing.

Here's another link: https://www.uber.com/us/en/marketplace/pricing/surge-pricing

> This encourages more drivers to serve the busy area over time and shifts rider demand, to maintain reliability and restore balance.

> Surge pricing is a relief valve for the rideshare marketplace. Without it, when demand for rides exceeds the number of available drivers, riders would wait longer (or might not be able to get a ride at all). Drivers would have less incentive to accept requests in busy areas. Surge pricing helps restore balance to the network. By waiting a bit longer, riders can avoid the surge price.

They can buy Uber stock

You took an Uber overnight from DC to NY? That's wild.

Indeed, I'm not sure whether it was in an emergency situation (or if they're referring to NYC versus NY state when they talk about NY) but I regularly travel from DC to NYC and vice versa on Amtrak and it costs me around 100 bucks each way, even in the middle of the night which has some pretty good deals.

If it had not been surged price, it would have been a hell of a deal.

The NE regional is cheaper than that; my round-trip tickets are usually well under $250.

> With Uber, the vast majority of your fare is going to your driver

Surely the CEO wouldn't lie to us /s

Isn't (at least part of) the point of surge pricing to bring more drivers out onto the road? Or was that just a lie.

Would you drive someone 4.5 hours from DC to NYC for $250? The drive back would be $0, so $250 / 9, minus gas and mileage. It's very little. Meanwhile Uber got $650. I wouldn't do it.

on the one hand, you're right, and what's worse that if we apply the IRS mileage reimbursement to the whole round trip, that alone is not worth it, plus like 50 bucks for gas.

On the other hand, $250 cash in hand, now, without having to run around or idle for customers could be a lot of money for someone. People who drive these things don't work for fangs...

The driver asked me if his friend could also come because she was on the crew of the same flight and was also going to NJ. She offered to pay for part of it, but I was happy that I made it home and felt bad for the driver taking 1/4 of the money I paid, so I didn't take it.

It’s a complete lie. On a $116 surge price trip, drivers get an extra $5.[0]

THIS is how Uber finally turned a profit. None of that Kalanick bullshit about how only self driving cars can make Uber profitable.[1][2] It’s jacking up prices and pocketing the difference.

Never trust a tech bro. They’re all grifters and liars.

[0] https://www.tiktok.com/t/ZT8LCks4j/

[1] https://www.usatoday.com/story/tech/news/2016/08/19/s-self-d...

[2] https://www.cnbc.com/2020/01/28/ubers-self-driving-cars-are-...

It’s a complete lie. On a $116 surge price trip, drivers get an extra $5

It would be helpful to have a better source than hearsay on TikTok from some rando whose gig seems to be ranting about tech bros. Even a an Uber driver on TikTok would be good.

How very brave you to dismiss screenshots and take obviously out of touch and responsible billionaire Dara Khosrowshahi over the drivers who have been saying this very thing for literally years now.

Seriously. What makes Khosrowshahi believable here, and why do you identify with him?

How about some secondhand hearsay? I've heard this same thing from Lyft drivers. Their customers are all pissed, the drivers ask why, it's because a $30 ride is costing them $100. Meanwhile, the driver still just gets the usual rate

> It’s jacking up prices and pocketing the difference.

Obviously the way to make profit is to charge more than you spend.

Literally the definition.

Hotter take: Pocketing the excess value of someone else's labor and capital is theft.

Only if you believe in the labor theory of value which has a lot of flaws instead of thinking that value is derived from supply and demand which has more predictive power and can be a better model.

Hottest take: As a worker, only you can free yourself from your chains. It ain't the corporations' job to start the revolution on your behalf.

Don’t wait around for revolution either

who knows? they have a ton of data that we don't have, and can infinitely tweak the pricing and the take-home based on their needs at the moment

I hope he found someone doing the way back, that must have been a horrible time.

With this one comment, and about $50 million in advertising and $50 million in development, you can erase Uber. (the 50MM in advertising is the budget to make ads that convince Uber drivers to get paid the $900 instead of the $250) And the $50 is the app dev budget.

Yeah, it is a crazy markup and it's why they were able to increase their ARR by 58% this last year. I think the more frustrating thing is lack of serious competition in the space to keep them from jacking up the prices down so much. Lyft should be drastically undercutting Uber in order to force them to lower prices or out of the market but they aren't, instead they are on average charging more. Need better startups in the space

Wouldn't that effectively be asking Lyft to jump on a grenade for the greater good?

Drastically undercutting the competition means you leave money on the table. Let's just assume a 5% discount isn't enough to win riders but 15% is, should the cut fares but anything over 15% just to screw Uber? And does this risk setting a low enough market cap on Lyft that they could be compelled to take an acquisition offer simply because they so drastically under cut their potential revenue?

Startups' job isn't to fix a broken market, it's to either become self sufficientquickly or to 10x investor capital depending on the funding model. The only business model that can really justify cutting fares drastically would be a non-profit, maybe some kind of collective run by the drivers themselves.

> Startups' job isn't to fix a broken market

An aside...why are we still referring to Uber and Lyft as startups? They are 14 and 11 year old, extremely well established, multinational companies. They are no longer the little guys disrupting an entrenched market.

When do they stop getting the excuse of being startups?

Totally fair, I tossed startup in there pretty loosely as I was thinking about their goals when they originally opened. I definitely don't consider them startups today.

Big Insurance/Banking companies is around a hundred years old. Uber is still a new business trying to prove it works.

I’m sure it’s the software development cost that’s eating Lyft’s profit margins. Would love for someone on the inside to share insights on that.

Receipt: https://imgur.com/nZ9cjQP

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