Uber and the NSW Government have struck a deal to cap fare prices when public transport breaks down.
The NSW Government’s deal with Uber will limit surging prices to double the price of a normal fare during public transport disruptions. It’s an Australian first.
Some quick background
Uber’s algorithm means demand heavily influences the fare price offered to passengers.
Currently, fare prices can rise to four or five times the standard price in some circumstances.
There have been significant public transport disruptions in the past 18 months in Sydney, including sudden train shutdowns and worker strikes.
The deal between Uber and the NSW Government
The NSW Government and Uber will now work together when an unplanned transport disruption occurs.
Prices for passengers will now be subject to human intervention, rather than derived just from an algorithm.
The NSW Government will not subsidise the losses in fares for Uber. They said Uber would be gaining “reputational protection” from the deal.
The Government plans on negotiating similar pricing agreements with other operators, such as DiDi and 13cabs.
The deal with Uber was struck this week, but was first deployed as a trial following a fire at an abandoned Sydney building last week.