Uber’s surge pricing has once again raised eyebrows, even startling the company’s CEO. During an Uber ride to an interview, a journalist paid a staggering $51.69 for a 2.95-mile trip, including tip. When shown the fare by Wired editor Steve Levy, Uber CEO Dara Khosrowshahi exclaimed, “Oh my God. Wow.” In a conversation with Levy, Khosrowshahi guessed the cost to be around $20, highlighting how far off he was. Khosrowshahi attributed the exorbitant fee to surge pricing, which Levy found puzzling given that it was a sunny weekday morning with no special events. However, Khosrowshahi cited inflation as the reason for increased prices, claiming that everything, including time and labor costs, has become more expensive. Contrary to Khosrowshahi’s statement, a report by Forbes revealed that Uber’s prices in the US have increased at a rate four times higher than inflation between 2018 and 2022, with fares rising a total of 83% over that period. While Khosrowshahi has previously attributed price surges to a shortage of drivers during the pandemic, Forbes’ report contradicts this, as Uber reported a record-high 5 million drivers in August 2022. The higher prices may have contributed to Uber’s impressive second-quarter performance, with the company recording a profit of $394 million, a significant improvement from the $2.6 billion loss reported a year ago. Operating profits for the quarter reached $326 million, marking the first profitable quarter since the company’s inception in 2009. Uber expects to see further operating profits by the end of the third quarter. Despite these positive figures, Uber’s stock fell by nearly 6% on Tuesday. Additionally, the company announced that its CFO, Nelson Chai, will be departing on Jan. 5, 2024, and a search for his replacement is underway. Chai, who took over the role in 2018, oversaw Uber’s IPO in 2019 and the acquisition of Postmates in 2020.
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