Fearsome Snowstorm Poses First Test of Uber’s Commitment to Cap Prices

taxi snow storm

App-based ride-hailing service Uber has vowed to keep its promise to limit prices during the massive blizzard now slamming into the northeastern U.S., in the first test of its new emergency pricing policy in New York, reports said.

Uber, which has been sharply criticized for jacking up prices at times of high demand, has told New York City customers that it will charge no more than 2.8 times the usual fare for trips during the storm that started hitting the city on Monday, Reuters said.

“Per our national policy, during states of emergencies, dynamic pricing will be capped, ” Uber said in a statement Monday, referring to its so-called surge pricing model, USA Today said.

“Due to the State of Emergency declared in New York City, prices will not exceed 2.8x the normal fare, ” Uber said in a later email to users of its app on Monday, Reuters said.

Tens of millions of people rushed to get home and settle in as the storm barreled in with the potential for hurricane-force winds and 1 to 3 feet of snow that could paralyze the region for days. Forecasters said the brunt of the storm would hit late Monday and into Tuesday, AP said.

New York, New Jersey, Connecticut, Rhode Island and Massachusetts all declared a state of emergency, Reuters said.

“We expect to have a serious problem on our hands, ” New York City Mayor Bill de Blasio said at a press conference on Sunday, according to Bloomberg. “We are facing one of the largest snowstorms in the recorded history of this city.”

He specifically mentioned car services as a possible flash point, according to New York Business Journal. “If you have any evidence of people taking advantage of this emergency to unfairly and illegally raise the prices of the ride, it’s important to call 311 and report it, ” he said. “Price gouging in the context of an emergency is illegal.”

“I think it would be immoral to charge people extra because there’s a natural disaster going on, ” he said when asked whether Uber and other car services should suspend the practice of raising prices at times of high demand, Reuters said.

Uber warned that some cars may be late arriving and may not be able to take passengers to their destinations if blocked by uncleared snow, the report said.

The ride-sharing company found itself in the crosshairs of regulators last year because of its surge pricing, which left stranded New Yorkers with sky-high bills during a January 2014 storm, USA today said.

Uber charged customers up to seven or eight times the normal fare during the blizzard, Capital New York said.

New York Attorney General Eric Schneiderman launched an investigation into Uber’s pricing model following the flurry of complaints, and in July the company agreed to cap prices during emergencies and disasters, a policy that it also extended nationally, USA Today said.

Schneiderman’s office “will be working with Uber to ensure last year’s price cap agreement is in full effect, ” said a spokeswoman for the attorney general, the report said.

Thousands of flights in and out of the Northeast were canceled, and many of them may not take off again until Wednesday. Schools and businesses let out early. Government offices closed. Shoppers stocking up on food jammed supermarkets and elbowed one another for what was left. Broadway stages went dark, according to AP.

 

 

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