Uber is denying an NPR report from earlier today that described the company’s plans to eliminate its controversial surge pricing technique.
NPR interviewed a top Uber engineer and noted that “killing surge rates is top of the list” for the company’s short-term priorities.
But in a statement sent to GeekWire, Uber said that the NPR story is “not accurate” and that it has “no plans to end dynamic pricing.”
“Uber is always looking for ways to better predict supply and demand in a city. But this story is not accurate: we have no plans to end dynamic pricing. While we understand that no-one likes to pay more for the same trip, it’s the only way to ensure that passengers can always get a ride when they need one.”
Surge pricing a controversial technique used by Uber and Lyft that increases the price of a ride when demand is high as a way to encourage more drivers to get on the road and provide customers with service as soon as possible.
Uber has consistently defended the surge pricing practice with a basic economics argument, noting that it simply helps supply meet high demand. Benchmark partner and Uber investor Bill Gurley offered this detailed analysis in 2014 for why Uber’s model differs from that used by airlines and hotels.
The NPR report showed how Uber wants to use machine learning to better predict demand and supply, therefore reducing the frequency for when surge pricing is implemented. However, while it aims to reduce surge pricing, the company does not plan to completely eliminate it — that might only happen when Uber’s self-driving cars arrive.
This is good news for riders, who can avoid the rate hikes. But it’s not as beneficial for drivers — or Uber’s revenue — who make extra income during busy times thanks to surge pricing.
Editor’s note: We updated this story to include Uber’s statement.
