Uber drivers, already feeling rising cost-of-living pains, say there will be a mass industry exodus if base rates don’t increase to sustainable levels.
Les Johnson, the secretary of the Ride Share Drivers’ Association of Australia, said fees and charges had “gone through the roof” in recent months resulting in high driver cancellation rates.
“Guys are starting to realise if I drive 12km to pick up a job and it’s only a five-minute trip, they’re losing money,” he said.
“Everyone is saying fuel is the big cost, it is, but … fees and charges have gone through the roof. Where once you could get into rideshare for $150… now you’re looking closer to $800.
“Drivers are stopping driving.”
Johnson said since the association formed in 2016, the price of fuel had doubled while there had only been marginal pay increases.
On Saturday, a temporary fuel surcharge Uber introduced to combat surging petrol prices lapsed. The measure added about six cents per kilometre for drivers.
Last month, Uber made changes to rates based on driver feedback to increase earnings while maintaining an “affordable experience” for riders.
Johnson said the impact had been “absolutely minimal”.
“Each jurisdiction seems to have a slightly different rate depending on what they can get away with … but in outer metropolitan Brisbane it went up about seven cents per kilometre,” he said.
“The rates need to be increased at least 25% to make it viable for drivers, and there has to be more disclosure of the tariff and what the job entails.
“Otherwise, the turnover for drivers is going to increase more and more.”
Regional areas have been particularly hard hit.
Uber base rates are decided based on supply and demand for a particular location, with recommended rates varying across regional and metropolitan markets.
The total rate for a trip then factors in estimated time and distance of the route, current demand in the area and tolls, surcharges and fees.
A rideshare driver based in the New South Wales Shoalhaven area said driving Uber outside metropolitan regions felt like “slave labour”.
The driver, who wished to remain anonymous, said while demand for Ubers may not be as high in the regions as in cities, the service was essential.
“Taxis don’t exist in most of these regional areas or you just can’t get one,” he said. “[But] in the past three years as a driver, Uber has only recently increased fares to help in these troubled times.
“Uber is so out of touch with regional areas and fares, it’s almost like they don’t care that some drivers really need the job … there’s little work and ridesharing used to be something they made a small profit from. It’s become unprofitable for drivers now.”
The driver said Uber was yet to compensate for higher fuel costs and longer commute times in regions.
“Fuel prices can be $0.50 a litre higher than in the city … yet Uber’s prices base fare is less. That makes no sense, [and] the driver has no idea where the rider is going to until they actually pick up the rider and start the trip,” he said.
He said after Uber takes its 27.5% commission and counting fuel costs, short trips of around five minutes usually left drivers with a regular payment of $5.88.
He said long trips came along “once in a while”; however, as drivers were only paid for one way on the trip, he rejected more trips than he accepted.
“I can’t afford to go pick up the rider if I have to travel any distance,” he said.
“If a rider is more than five minutes away from me, they just don’t get an Uber. That’s sad … regional areas have very limited Ubers in their town, [because] new drivers coming on board quickly learn there is no money to be made.
“They disappear as quickly as they came.”
Michael Kaine, the national secretary for the Transport Workers Union, said transport workers had been left “in the lurch” and needed the protection of a tribunal to enforce rates.
“Fuel costs are surging again, but there’s still no targeted relief … pushing many to the brink,” he said.
“Without [a tribunal], workers are forced to bear the brunt of costs outside of their control. It’s not sustainable.”
Sandy Nagesh has been driving part-time for Uber for two years. Based in Parramatta, he mainly targets the Sydney CBD and eastern suburbs on weekends when traffic is busiest.
He said Uber was “all for themselves”.
“When everything else is increasing: expenses, fuel, rent of vehicles, the base fare should increase as well but it’s been the same since I started driving,” he said.
“The same time last year I was paying just over a dollar for a litre of petrol and now I’m paying $1.80.
“Uber’s still keeping me going but if I were to drive on the weekdays, it wouldn’t be profitable.”
Nagesh said to make the service viable, Uber should reduce its commission in line with similar apps like DiDi, which takes 13%, and Ola, which takes 15%.
“Uber takes 27.5%,” he said. “It’s a big cut … fair enough, they’re running the company, but that’s about it.
“Everything else is on us.”
A spokesperson for Uber said the company had been listening to driver feedback that fares needed to be higher.
“We considered this … in addition to the impact on the demand for trips from riders, to determine the new recommended fares,” the spokesperson said.
“We haven’t made broad ranging changes to pricing for a number of years, and for cities launched more recently, we haven’t revisited pricing since launch of those cities.
“These changes have been driven by our desire to deliver the best rideshare platform for driver-partners to earn on and for riders to enjoy a safe, reliable and convenient way to get from A to B.”
