In another move aimed squarely at San Francisco's maligned taxi cab industry and comparable rideshare services, Uber has dropped the rates on their UberX hybrid car service to undercut standard taxi fares.
Although the two services have been comparable in price for the past six months, starting today UberX rates begin with a $3 base fare, plus $1.50 per mile after that or $0.30 per minute waiting in traffic. Yellow Cab's city-mandated meter rates start at $3.50 just for getting in the cab, plus $2.75 per mile or $0.55 per minute spent in traffic. To put that in practical terms: assuming there's no traffic, a four mile UberX trip will cost $9 total (including tip) while the same trip in a cab with a city medallion will cost $13.95 total before tip. Keep in mind, however, that UberX is still susceptible to the dreaded surge pricing during busy hours.
In the past, Uber's high fares and pricing schemes have positioned the company as a luxury service for customers with hefty expense accounts or pockets lined with VC cash, and users gladly paid extra for the convenience of hailing a ride from their smartphones. Although the town car and SUV options still cost a premium (as does hailing a city taxi through Uber), catching a ride in a privately-owned hybrid car is now noticeably cheaper. In other words: city taxis legally cannot compete with car service rates that low.
Late last year, Uber also began expanding its network of drivers by offering to help finance new vehicles for anyone who signed on as an Uber partner.
Finally, in related news, Uber has been catching plenty of bad PR lately. Price gouging accusations and boycott threats aside, a driver of a Honda Pilot SUV was searching for fares through Uber's service when he struck and killed 7-year-old Sophia Liu in the Tenderloin on December 31st. That driver has since been removed from Uber's system, but the case raised additional questions about liability.