Uber’s loathed surge pricing left even its own CEO with sticker shock.
A journalist who took an Uber from downtown Manhattan to interview the company’s boss Dara Khosrowshahi on the West Side paid $51.69, including the driver’s tip, for the 2.95-mile trip.
“Oh my God. Wow,” Khosrowshahi exclaimed when he was shown the eye-popping fare by Wired editor-at-large of Steven Levy, who revealed their conversation Tuesday.
In his sitdown with Khosrowshahi — which happened in May at Uber’s annual product event Go-Get — Levy asked the executive to guess the cost of the trip.
“Twenty bucks,” ventured Khosrowshahi, whose company announced it turned its first-ever operating profit when it released second-quarter earnings Tuesday.
Levy informed the ride-share boss how far off he was and told him: “Five minutes earlier, the price was $20 higher.”
Khosrowshahi attributed the head-scratching fee to “surge pricing,” according to Levy.
“A surge makes no sense,” the journalist replied. “It’s 10 a.m. on a sunny weekday, and it’s not like the president’s in town.”
“Everything is more expensive,” Khosrowshahi said bluntly, citing that the effects of inflation have caused rates to go up along with the cost of time and labor.
However, a report by Forbes concluded that Uber’s prices in the US have increased at four times the rate of inflation from 2018 to 2022.
Fares rose a total of 83% over the nearly four years ending in Q3 of 2022, according to Forbes.
In the past, Khosrowshahi has attributed soaring prices to a shortage of drivers during the pandemic, though Uber reached a record-high 5 million drivers in August 2022 — up 31% from the year prior, the company noted in its Q2 2022 earnings report.
The Post has reached out to Uber for comment.
The higher prices may have played a role in Uber’s stellar second-quarter performance.
The company recorded a profit of $394 million in the three-month period ending June 30 — a massive improvement from the $2.6 billion loss it posted this time last year.
Operating profits came in at $326 million for the quarter — the first profitable quarter since Uber’s founding in 2009.
The company predicts it will see additional operating profits by the end of Q3, on Sept. 30.
Meanwhile, revenue rose 14% year-over-year, to $9.2 billion, and total transactions on its app grew 16% from 2022, to $33.6 billion.
Despite the positive figures, Uber’s stock fell nearly 6% Tuesday.
The company also announced that Uber’s chief financial officer, Nelson Chai, will leave the company on Jan. 5, 2024, and “a search for his replacement is underway.”
Chai, who stepped into the role in 2018, led Uber’s initial public offering in 2019, and oversaw the company’s $2.65 billion acquisition of Postmates in an all-stock deal in 2020.
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