Uber warns of higher prices and longer wait times following Toronto’s decision to freeze new licences
This article is more than 6 months old
This article is more than 6 months old
New drivers should be prepared to pay higher prices in the months ahead as a result of Toronto city council’s decision to freeze new ride-hailing licences.
The city could take another drastic step to save money by introducing a cap on daily rides under its new vehicle operating and licensing system (VOAS), a move that could have dramatic consequences for Uber, which currently operates a fleet in Toronto and several other cities.
Uber has already cut its number of vehicles to about 1,000 globally — mostly in the United States and some other cities — to comply with a city bylaw that forbids drivers from being available for more than 25 per cent of operations, or 1,000 rides in a year.
That cap will be lifted in Toronto in June, and Uber says the move will result in higher prices and longer waits on its app. To keep the company operating, the city wants new drivers and riders to pay the same rates that are in place for UberX. But since Uber has eliminated fares for UberX and is charging more through the app, that will eat into Uber’s earnings.
Uber Toronto said UberX rates had increased in recent weeks, with rates for UberPool and Uber Eats rising more than 50 per cent.
Riders should have to decide whether to pay higher prices for Uber or UberX, in line with what they have to pay in ride-hailing companies in other cities, it said.
The company said the decision to freeze its current vehicle fleet in Toronto could see it shed 200 drivers, with more than half coming from the United States.
But it’s not the only company under pressure to cut its Toronto fleet.
Last month, Uber’s Toronto fleet was the lowest in the city, with only 1,100 vehicles. That is far lower than the 9,000 or so vehicles in other cities Uber operates in, according to the company.
Uber and Lyft have announced plans to cut their Toronto fleets to 200 vehicles in the next year, and they are in talks with various public transit agencies to operate their services.
Toronto is far from alone.
Last month, Chicago said it would freeze new driver and
