How Uber uses AI to charge you more
Uber once sold riders on a simple promise: Order a car right from your phone for less than a taxi. Since then, prices have risen dramatically.
Uber once marketed itself as offering cheaper rides compared to taxis, but the truth is far more complex. The company now relies on sophisticated algorithms and a host of real-time variables to determine both the cost to riders and the earnings of drivers. This shift has led to a significant increase in fares over the years. Between 2018 and 2022, average Uber fares in the US climbed by 83%, more than quadrupling the annual inflation rate.
Even when Business Insider employees requested the same UberX ride at the exact same time, they found a staggering variance in prices, with the highest fare being nearly 21% more expensive than the lowest. A broader Consumer Reports study comparing Uber and Lyft found even wider price discrepancies on certain routes. Many critics have accused Uber of leveraging artificial intelligence and algorithms to maximize profits from consumers while keeping drivers' earnings at their lowest.
Uber, however, maintains that it does not use personalized data and attributes the surge in prices to higher operational costs and a post-pandemic driver shortage. The burning question then is: how exactly does Uber calculate your fare and what's the true reason behind the exorbitant cost of Uber rides?
Written by urgent.news from Business Insider's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
