Uber introduces Uber Hourly for long trips as it explores new revenue sources
Uber Technologies Inc. is launching another new service in its ride-hailing app as it experiments with ways to offset the impact of the coronavirus pandemic on its business.
The service, which is expected to become available in some U.S. cities on Tuesday following a limited international pilot, allows passengers to book rides by the hour. It caters to users needing to take long trips such as errand runs that may involve multiple stops along the way. Uber Hourly, as the offering is called, allows users to specify the length of their ride in the app interface and add up to three stops including the designation.
The service will launch in 12 U.S. cities at first with more expected to be added to the list over the coming weeks. The initial roster is set to include Atlanta, Chicago, Dallas, Houston, Miami, Orlando, Tampa Bay, Philadelphia, Phoenix, Tacoma, Seattle and Washington, D.C.
Uber Hourly is rolling out following a report that Uber rides were down as much as 80% in some cities during April. Demand for ride-hailing services has plummeted worldwide amid the coronavirus pandemic, which has forced Uber to lay off 6,700 employees over the last few weeks. Its ride-hailing business is currently operating at partial capacity with safety policies that include mandatory face masks for drivers and passengers, among other precautions.
Uber has been prioritizing other areas in a bid to make up for some of the lost revenue. The company moved into the delivery business last month, launching two new services that enable consumers to send items to one another and businesses to deliver online orders. Uber is reportedly also in talks to acquire publicly traded rival GrubHub Inc. to expand its Uber Eat food delivery division, which recorded a 53% revenue surge last quarter.
The newly launched Uber Hourly service is priced at $50 per trip hour not including tolls and surcharges. Users need to specify the number of hours their trip will last in advance and are charged at a per-minute rate if the limit is crossed, with a 40-mile cap on trips in some cities.
Niraj Patel, Uber’s director of rider operations, hailed the service in a statement as “an additional earnings opportunity for drivers as we move forward in this ‘new normal.'”
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