Internet-based ride-sharing service Uber is cutting prices for its entry-level UberX service in Cape Town, Johannesburg and Durban by up to 20% to spur demand in the winter months, the company said on Wednesday.
“During winter, riders tend to venture out less and this can be tough for driver-partners as this time spent idle is time they’re not earning,” the company said.
“Over the years, we’ve learnt that the single most effective way to help driver-partners get more trips is to cut prices for riders,” it said, citing examples from Lagos, Warsaw, Istanbul and Perth. “The increase in demand meant payments to driver-partners using Uber went up.”
The company said that although the price cuts benefit those using Uber, they’re “ultimately designed to help Uber driver-partners”.
“We know that this period is considered a slow time for driver-partners and through experience, we know price cuts help both riders and driver-partners,” said Uber sub-Saharan Africa GM Alon Lits in a statement.
Lits said that while each city “adjusts to the new prices”, Uber is putting in place “minimum payment guarantees” for driver-partners. “If the amount driver-partners make on the road isn’t what we expect, we’ll reassess this price change.” — © 2016 NewsCentral Media