Uber’s New Surge vs. Old Surge

Uber has had recent changes to their surge pricing in various markets across the country. If it has not come to you yet it will soon enough. Below are explanations of the old surge and new surge systems

Old Surge [Multiplier]

The way surge pricing works is by multiplying the normal cost of a ride by the active surge multiplier. For example, if a normal ride from Point A Apartments to Point B Bar is $10.00 with a 1.4 multiplier like the one below the true cost would be $14.00. Whoop-ti-do, right? That isn’t a huge incentive but it’s still more then you would traditionally get which is good. Surge becomes a big deal is when you get a super high multiplier like a 7.9 multiplier. With that 7.9 surge pricing a $10 ride becomes a $79 ride. Now that’s big money.

Surge pricing happens at seemingly random intervals but it is triggered by surges in demand. Surges typically happen at different times depending on your market. Typically times are in the mornings, afternoon rush and mainly on the weekends. This is when people are going to work or need a ride home from the bar.

New Surge [Flat Rate]

 New surge pricing works off of flat rate additions to drives. This may flat rate may be an extra $1.50, $5 or even $10 extra. But regardless of the distance traveled the surge pricing and overall pricing for you as a driver does not increase. 

Uber says this new surge was instituted so drivers would be able to get a more consistent and frequent surge. As with the new surge if you just drive through an area with a high surge you will get that surge. So if you accept a +$2 surge but drive through a +$10 surge you will get the latter more expensive one applied to your pay. 

Surge Comparison

Many drivers are mad about this new change and with just reason as it does really change up the formula. 

Under the old surge, you as a driver were rewarded for taking long trips as even a low multiplier would have a great effect over a long drive. Under the new surge, short quick trips are preferred as the flat rate surge will give the same extra amount regardless of distance. 

Since I did a review earnings review of Uber before and after I can put pen to paper and say how the old vs new surge has worked in Toledo and it’s actually not bad. In fact, with the new surge and late fees, I was able to make over $3 more per hour.

I believe a large part of this stems from the fact that the new surge method makes surges more frequent and consistent. However, the money has to come from somewhere.

My Guess On How The New Surge Works

My guess is that surge earnings are being socialized amongst all drivers. I speculate that when you take a surge ride in a super high demand area you are not getting paid nearly what you should. But at the same time when you drive through a high surge area and get that applied to your drive, you are getting more than what you deserve. I believe the person paying for the surge pay increases in the cases of both drivers is the person paying for the extremely high surge price. So instead of that one driver getting that pay it is now split between both drivers.

So to put that in numbers for you to understand. A customer that is paying a 4.0 surge on a $10 drive will pay $40 total and $30 extra. When you pick him up you may be only getting $6 more from that ride. The extra $24 you would be getting are going to make sure 4 other drivers are getting $6 for their surge for simply driving through the area.

Is this fair? Not really, because veteran drivers make more because of what they do. Most study traffic patterns and adapt their nights to get that highest surge. At the same time a majority of Uber Drivers, most will see a likely increase in surge payments.