Uber is one of the most popular demand car services out there, but it has also become known as being a little expensive, and confusing. With increased competition out there, from services such as Hailo, Uber needs to remain competative in what is becoming a more crowded space.
In order to do that, the company made two big announcements regarding its San Francisco fleet on Friday: Not only will it will be lowering prices on its standard Uber Black car service by 10%, it also said that it is going to be expanding UBERx, its hybrid fleet, to the entire city.
San Francisco is where Uber first launched, and is also where the company is headquartered. It is also the most expensive place in the country to get a taxi.
"San Francisco has the highest taxi fares in the country… and the most expensive Ubers," Uber wrote. "We can’t do anything about the former, but we’ve decided to address the latter head-on by decreasing prices for the first time in Uber history."
In an effort to provide "more transparent pricing," the new Uber Black will have lower time and distance charges, plus a lower base fare. It will also now have the same per-mile rate whether a user is traveling in the city or beyond its borders. Also, since users are now responsible for all bridge and other tolls incurred on a trip, drivers are more likely to go outside the city.
The new fare rates will be effective Monday, January 21.
In addition to lowering rates, Uber is making another effort to lower costs in its home city, by taking UBERx out of beta and making it available to all of San Francisco.
UBERx, which first launched in July 2012, is a fleet made of mostly hybrids, as well as some smaller sedans. It is a lower cost option to Uber's standard Black service. This is how the two service compare, price wise:
"Last year, we started testing UBERx, a lower-priced alternative to our Black Car service. We found that riders who relied on premium cars for business travel and nights on the town also embraced a more affordable choice for everyday use," said Uber.
Uber warns users that, though it expects UBERx "to be as convenient as Uber Black," users should know that there is the possibility of "slightly longer arrival times and drivers who are more dependent on GPS."
Uber is making a smart move by lowering its rates, and making them clearer, since that is how it will stay competative against other competing services like Lyft, Zimride, Tickengo, and SideCar, which raised a $10 million Series A round of fundraising in October.
Uber's service, while popular, has also become known as both confusing and expensive. The more competative its prices can be, the better it will be able to fend off rivals such as Hailo, which was reportedly set to raise a $30 million Series B round at a $140 million valuation last month. The new round would have put Hailo's total funding above $50 million, just slightly ahead of Uber.
Since launching in 2009, Uber has expanded operations across the country, and to other parts of the world. The San Francisco-based company has operations in Amsterdam, Atlanta, Boston, Chicago, Dallas, Denver, the Hamptons, London, Los Angeles, Minneapolis, New York City, Paris, Philadelphia, Phoenix, San Diego, San Francisco, Seattle, Sydney, Toronto and Washington D.C.
The service is also available in Napa, Orange County and Vancouver but the website says this is for "secret Ubers only," whatever that means.
Uber also hinted that it might soon be expanding its operationt to Sacramento, Silicon Valley, and Oakland, and urged its users to "stay tuned for more information."
Uber also has a taxi service that it recently expanded to Washington D.C. In December it announced that the New York Taxi and Limousine Commission had voted to allow a year long pilot program that will let people in New York to use their phones to connect with yellow cab drivers.
Uber raised a $32 million Series B in December, led by Menlo Ventures, with participation from Amazon's Jeff Bezos, Goldman Sachs and Benchmark Capital, bringing its total raised to around $45 million.
(Image source: http://blog.uber.com)