Uber rich tax: Does the car company charge more for living in a wealthy locality?

Uber may charge an amount you are willing to pay, says report.  It could calculate a higher price depending upon the route and time of the day. The fare could be higher for a wealthy location compared to a not-so-affluent one.   

Uber's new fare rate is called 'route-based pricing' that charges customers depending upon how much they are willing to pay, as per the report. This is unlike earlier when Uber calculated the fares taking into account the geographical location, mileage and time. It could mean that if you have been taking a ride at a higher price, it may continue to charge you at the same rate. On the other hand, if a user has been cancelling high-price rides, then it may show this user the price he or she is willing to pay.

We wonder if this practice is applicable in the Indian market too. Further, the report adds that Uber may calculate a higher price depending upon the route and time of the day. It explains that those travelling from a wealthy neighbourhood could be charged more than someone going to a not-so-affluent neighbourhood. For instance, a ride from Lavelle Road, Bengaluru could cost you more than a rider who is travelling to Ejipura. These prices would differ, irrespective of the same distance, demand and traffic in these routes. The machine learning takes into account factors like the time of the day you are taking the ride. 

The increasing gap between what the passenger pays and how much Uber pays the driver has been an issue. Uber has claimed to maintain transparency. However, it may tell the driver the overall price a customer has paid, but not reveal further breakup.

The report suggests that as Uber experiments with new pricing ways, newer challenges could stem out of the issue. The wait times at these not-so-affluent areas could increase. It is to be seen how Uber plans to move forward, without hurting customers as well as drivers.