[US] Uber asks NYC taxi commission to adjust for cheaper fuel by lowering minimum pay

According to a letter to the Taxi and Limousine Commission (TLC) seen by Bloomberg, Uber is seeking to lower the minimum pay rate for ride-share drivers in New York City to adjust for the lower price of fuel, MSN reports.

Uber will ask TLC to lower the minimum pay threshold by 6.1 per cent to $1.277 per mile, together with a 3 per cent ceiling on future inflation-related adjustments or the average rate of the Consumer Price Index. 

The requested changes reportedly follow Uber CEO Dara Khosrowshahi noting a slowdown in the company’s core US business during its most recent earnings call, after it passed on higher insurance costs to riders.

According to Bloomberg, in his letter Uber senior counsel Nicholas Davoli stated that the reduction in the per-mile rate is intended to ensure that prices “no longer outpace inflation, and riders can continue to afford trips”.

The estimated 42 cent reduction in the cost of a journey is reportedly expected to translate into an increased demand for rides, theoretically offsetting the impact a reduced base rate would have on total driver earnings.

Statistics from the U.S. Energy Information Administration show that the price of a gallon of gas has dropped by 12 per cent since April and is down 35 per cent from its June peak of $5.032 per gallon. In addition to cheaper gas prices for drivers, Uber cites the lower cost of a used vehicle while new car prices have remained steady as a further argument for a rate decrease. 

Source: MSN

(Link and quote via original reporting)

According to a letter to the Taxi and Limousine Commission (TLC) seen by Bloomberg, Uber is seeking to lower the minimum pay rate for ride-share drivers in New York City to adjust for the lower price of fuel, MSN reports.

Uber will ask TLC to lower the minimum pay threshold by 6.1 per cent to $1.277 per mile, together with a 3 per cent ceiling on future inflation-related adjustments or the average rate of the Consumer Price Index. 

The requested changes reportedly follow Uber CEO Dara Khosrowshahi noting a slowdown in the company’s core US business during its most recent earnings call, after it passed on higher insurance costs to riders.

According to Bloomberg, in his letter Uber senior counsel Nicholas Davoli stated that the reduction in the per-mile rate is intended to ensure that prices “no longer outpace inflation, and riders can continue to afford trips”.

The estimated 42 cent reduction in the cost of a journey is reportedly expected to translate into an increased demand for rides, theoretically offsetting the impact a reduced base rate would have on total driver earnings.

Statistics from the U.S. Energy Information Administration show that the price of a gallon of gas has dropped by 12 per cent since April and is down 35 per cent from its June peak of $5.032 per gallon. In addition to cheaper gas prices for drivers, Uber cites the lower cost of a used vehicle while new car prices have remained steady as a further argument for a rate decrease. 

Source: MSN

(Link and quote via original reporting)