Uber offers on-demand rides in vehicles that vary in their swankiness. Fares on its lower-priced UberX option are about to go up with a "Safe Rides" fee tacked on to your receipt.
The company said in a Thursday night blog post that the $1 fee is its way of demonstrating "continued commitment to safety." The $1 per ride goes toward background checks, DMV checks, driver safety education, insurance, and the app's safety features. The fee applies only to UberX, which is the company's ride-sharing service offered by regular drivers in normal cars. The higher-priced black cars and SUVs will be unaffected by the fee.
Those safety measures sound like the cost of doing business for a transportation company. So why doesn't Uber just raise prices on UberX if offering safer rides require more money on the back-end? Because price hikes don't go over well with users, while public safety pledges might be more palatable. Also, Uber recently slashed UberX rates in a handful of cities to compete with competing ride-sharing services like Lyft and Sidecar, so it can't exactly backtrack. Lyft charges a similar $1 "Trust & Safety Fee."
Uber's stance on safety was tested in the wake of a fatal accident this past New Year's Eve. An Uber driver struck and killed a child, but because he was in between fares, Uber backed away, claiming its insurance policy covers drivers only when Uber passengers are in the car. The company has since extended its insurance coverage to drivers who are between rides but available to accept passengers in the app. Lyft offers similar coverage.
Uber also had to beef up its background checks after dealing with unsavory drivers with criminal records who managed to pass rudimentary checks. The company now contracts with an independent, multi-state screening service instead of using existing state and local checks.
Fees can make users feel nickel-and-dimed--like they do when they have to pay exorbitant rates for checked baggage or hotel Wi-Fi--but Uber does need to cover its behind when it comes to safety. The new fee might not be the best way to accomplish that, but at least it proves the company is making an effort.