Uber pricing got frightfully high on Halloween

Years of student activism calling for the town to better regulate taxis has been thwarted by the ride-sharing service Uber.

For students who turned to companies like Uber and Lyft instead of local taxi companies on Halloween, the holiday turned from a festive celebration into an expensive evening.

Ian McDonald, a second-year dental student, needed a ride home from Top of the Hill restaurant on Halloween evening, so he used Uber for a ride. Typically, this trip costs McDonald around $28, but on Halloween evening he paid $277.

This substantial price increase is due to Uber’s surge pricing, which is also known as dynamic pricing.

Surge pricing acts like a multiplier. In McDonald’s case, he was required to pay 9.8 times the regular fare.

In 2013, the Chapel Hill Town Council approved an ordinance for taxis that set a flat rate between $6 and $8 for a 1.5 mile radius in the Chapel Hill Central Business District, a fixed rate of $2.50 per mile outside of this area and a $5 flat rate during special events like football games.

Liala Edwards, Tar Heel Taxi employee, was very surprised to hear that Uber uses dynamic pricing.

“On game nights, we may charge four or five dollars extra,” she said. “But usually no more than that.”

Mitch McKinney, administrative lieutenant at the Chapel Hill Police Department, said companies like Uber and Lyft aren’t required to comply with the flat rate ordinance because there is federal law preventing the regulation of the companies as taxi services.

“They won’t fall under the flat rate taxi fee because by law they’re considered a digital dispatch service, and by law we can’t hold them in compliance with that ordinance,” he said.

According to Uber’s website, surge pricing occurs to get more drivers on the road. Once enough drivers are on the road, the pricing is supposed to go back down to normal levels.

Lyft, a company similar to Uber, has a related charge called Prime Time.

Kaitlin Durkosh, Uber spokeswoman, said that dynamic pricing purely depends on the consumer demand and the supply of vehicles on the road.

“Dynamic pricing allows us to be a reliable choice even on the busiest nights of the year,” Durkosh said.

“We think its better for a user to open the app, see that the dynamic pricing is in place and have the choice about whether or not to proceed than to open the app and see that no cars are available.”

Sophomore Erika Lewy said she’s been using Uber since August. On Halloween, a trip from North Columbia Street to Morrison Residence Hall cost her $44. That trip would normally cost between $5 and $7, according to Uber’s website.

“I’m bummed because it really hurt my wallet, but in the end I understand business is business,” Lewy said.

McKinney said that although there is no current legislation to regulate the prices of Uber, it’s only a matter of time before that changes.

“I absolutely think that we’re all looking at how they’ll be legislatively regulated, I just don’t think there is an agreement right now with how that should happen,” he said.

Currently, dynamic pricing is capped during disasters and relevant states of emergency.

Durkosh said that surge pricing typically only reaches one or two times the normal rate and is temporary.

“It’s complicated because they’re a digital business, and they can operate so easily from basically anywhere they have an Internet connection or through a wireless media like your cellphone,” McKinney said. “And that’s just the emerging technology, and people are taking advantage of that to create a business.”

city@dailytarheel.com