This blog post was originally published on April 8, 2021. On April 23, 2021, we added an update to this post, below.
You’ve told us that the reason you choose to drive with Uber is for the flexibility it provides. You decide when, where, and how long you drive so that work fits into your life, not the other way around. This flexibility forms the foundation of our platform. However, we know that your business—and ours—depends on riders taking trips.
A year ago, we rolled out features like fare multipliers (the ability to set your own price) and removed rider upfront pricing. Over the last year, rider cancellations have increased 117%. We’ve seen that most riders are simply not taking trips with fare multipliers above 1x or without an upfront price. As California reopens, we need to make changes so all drivers can get more trip requests and riders can count on getting a ride when they request one.
We’re removing the feature that enables drivers to set their own fare multiplier. We know this will come as a disappointment to the drivers who have used this feature, so we want you to know why we’re doing this.
Over the last few months, 80% of riders matched with a driver with a fare multiplier above 1x declined the higher fare and did not re-request a ride on Uber. Additionally, drivers who set a high multiplier received fewer trip requests.
You’ll continue to see surge areas on the map, where demand is high.
Rider upfront pricing and service fees
Last year we made a change that meant California riders no longer received an upfront price before requesting a ride; instead they saw an estimated range. This caused a substantial decrease in trip requests. So we’re changing pricing back to the way it was a year ago to encourage more rider requests on the platform. You can see what’s changing and what’s not in the table below:
|Before||Rolling out over the next few days||Change?|
|Riders see||Upfront range||Upfront price||Yes|
|Drivers earn||Base + time + distance + surge||Base + time + distance + surge||No|
|Uber’s service fee||25%2||Variable; it equals what the rider pays minus what the driver earns3||Yes|
|Prop 22 earnings guarantee1||Always earn at least [(1.20 x city’s minimum wage x hours) + ($0.30 x miles)] over a 2-week period1||Always earn at least [(1.20 x city’s minimum wage x hours) + ($0.30 x miles)] over a 2-week period1||No|
|Surge pricing||A multiplier (ex.: 2x) not shown on the heat map||A dollar amount (ex.: +$3) shown on the heat map||Yes|
We appreciate your patience while we work to improve trip reliability for drivers and riders. Thank you for all you do every day for your community.
1Hours are based on active time, which starts when you accept a trip or delivery and ends when you complete it. When calculating your earnings guarantee, we calculate 20% more than the pickup city’s minimum wage for your active time plus the number of miles you drove during that active time multiplied by $0.30 (unless you are a delivery person on foot or bicycle).
2The 25% service fee applies to UberX. A service fee of 28% applies to all UberXL, Uber Comfort, Uber SUV, and Uber Lux trips.
3Tips, tolls, fees, taxes, and surcharges are not included in what a driver earns.
Update: Clarifying time and distance rates on California trip receipts
4/23/2021 – A few weeks ago we wrote to let you know that we’re going back to providing an upfront price to riders in California. We explained that the way you earn (based on base rate + time rate + distance rate + surge) was not changing. However, we’ve heard that the way rates are now shown on your receipt might be confusing, so we wanted to explain what’s changed.
The most important thing to know is that base, time, and distance rates have not changed. The upfront-pricing update was not a rate cut. You will take home the same fare for the same trip, even though riders now see an upfront price.
Here’s what’s different:
Prior to the change, time and distance rates shown on your receipt included the service fee, which was deducted as a separate line item.
After the change, the base, time, and distance rates shown are your take-home rates. The service fee paid to us is no longer included in these rates. In other words, these are the exact rates you’ll earn for every minute and every mile you drive.
The service fee is now shown on the receipt in the “Paid to Uber” section and is variable, meaning it equals what the rider pays minus what you earn.1
See an example of how this looks on a receipt. In both cases, you’ll make the same take-home earnings.
Example trip (20-minute, 10-mile trip on UberX in San Francisco)2
|Time (20 min x $0.39/min)3||$7.80|
|Distance (10 mi x $0.91/mi)3||$9.10|
|Service fee (fare x 25%)||-$4.78|
|Time (20 min x $0.29/min)3||$5.85|
|Distance (10 mi x $0.68/mi)3||$6.83|
We want to reassure you again that your take-home rates have not changed. We apologize for any confusion caused by our initial communication.
1Tips, tolls, fees, taxes, and surcharges are not included in what a driver earns.
2Based on a 25% service fee prior to the recent changes.