Surge Pricing: This Uber rival wants to kill surge pricing: All the details

There are so many times when you want to book an Uber or Ola or any other cab for a commute and you see surge pricing. Ride-hailing apps often put surge pricing when there’s excess demand or during “rush hour”. One popular ride-hailing app wants to get rid of it, according to a report by TechCrunch.

David Risher, CEO, Lyft said that while surge pricing does offer incentives to drivers during peak hours, it can also be a demand suppressor. Often riders get put off by the high charges and either don’t hail a cab or wait for surge pricing to drop.
Risher was talking after the company’s quarterly earnings call and said that Lyft wants to “get rid” of surge pricing. “[Primetime pricing] is a bad form of price raising,” said Risher. According to the report by TechCrunch, Risher is clearly not a fan of the feature and says riders “hate it”. “It’s particularly bad because riders hate it with a fiery passion. And so we’re really trying to get rid of it, and because we’ve got such a good driver supply…it’s decreased significantly,” he said.

What is surge pricing?

Surge pricing is a pricing strategy used by ride-hailing apps like Uber and Lyft to increase prices during times of high demand. This can happen when there are a lot of people requesting rides in a particular area, such as during a sporting event or concert. Surge pricing, as Risher mentioned, is designed to incentivise more drivers to get on the road and meet the demand for rides.
The amount of surge pricing can vary depending on the demand for rides and the number of drivers available. In some cases, surge pricing can be as high as 5x or even 10x the regular rate. This can make it very expensive to get a ride during a surge, but it can also be the only way to get a ride if there are no other cars available.
Surge pricing is a controversial practice, and some people believe that it is unfair to charge customers more for the same service. However, ride-hailing companies argue that surge pricing is necessary to ensure that there are enough cars available to meet the demand for rides. Lyft does plan to kill but will it succeed and others like Uber follow suit? Wait and watch.