Uber, Grab explain price surges: Ensure riding options, supply-demand balance

App-based transport services Uber and Grab on Thursday sought to explain the price surges amid the high demand for services and heavy traffic over the holiday season.

In a statement sent to GMA News Online, Uber said fare price surge only happens when demand is high and there are insufficient cars in the area.

“During these times, dynamic pricing will automatically go into effect in these locations to encourage more drivers to get out on the road,” Uber said.

But as more cars free up, rates will go back to normal, it added.

“The objective of dynamic pricing is to ensure that you will always have a choice to get a ride, and not get stuck with no options left,” Uber said.

Meanwhile, Brian Cu, Country Marketing Head of Grab, said its fares are system-generated without human intervention.

“Price increases happen based on several variables such as passenger demand, app usage, road conditions and traffic," Cu told GMA News Online in a text message.

"The system finds a supply-demand equilibrium price to make sure we meet the needs of both our drivers and passengers,” he added.

Cu added that passengers are informed about the fares even before they confirm the booking, so that they can decide whether to take the trip or not.

“Fares are guaranteed to stay the same, fixed, throughout the trip,” he said.

A report by GMA News’ Cedric Castillo showed that the fare prices of Uber and Grab vary depending on traffic condition and time of the day.

According to the report, an Uber ride from GMA Network Center in Quezon City going to Batasang Pambansa at 8 a.m. will cost the passenger P279, while P322 using Grab Car.

From MRT-3 GMA-Kamuning Station to Makati City Hall at 8 a.m., an Uber passenger will have to pay P461, while a Grab passenger will pay P327.

From Monumento in Caloocan to Las Piñas at 8 a.m., an Uber passenger will be charged P882, while P913 will be charged from Grab passengers.

However, going to the same routes from 12-1 p.m. will cause a fare price decrease of about P66 to P219 in Uber and P73 to P363 in Grab.

Meanwhile, the Land Transportation Franchising and Regulatory Board said they wanted to know the basis for the price surges, the report said.

The agency also said they have already asked the operators of the two app-based transport services for a proposal to lessen the price surge. —NB, GMA News