Uber is well known for its focus on inventing new ways to make money—often not to the benefit of drivers. The company’s latest offering could be different, however, and that makes it especially intriguing.
Effective June 2, 2020, Uber will make it possible for customers to order rides by the hour. This new offering, according to the rideshare giant, stems from the idea of customers taking their “second first ride,” which is the Uber CEO’s catchphrase for people coming back to rideshare after being confined to their homes since mid-March.
Hiring (and being hired) by the hour can make things more convenient for customers and drivers, but there are downsides as well. In this article, we’ll address the following issues:
- What is this new offering for hourly rides?
- Where will it be available?
- How much is Uber charging?
- How much will drivers earn?
- Is it mandatory for drivers? Do drivers have to meet requirements?
- Why would this appeal to customers?
- What’s in it for drivers?
Uber by the hour— what is it?
The premise is pretty simple; one you might already have encountered if you’ve ever hired, or driven, a limousine. The customer orders the car for a set number of hours and pays a set fee. The car goes where the customer wants to go (thanks to the driver) for the rental time period.
This model works well in the post-COVID world because customers find it much easier to run their errands in a single car. More on that in a moment.
Uber wants people to know that their new service has been tested in other regions of the world, including cities in Australia, Africa, Europe, and the Middle East. In the United States it will be a flexible option, meaning we will continue doing single trips, rather than being restricted to the new hourly rides.
The Uber hourly ride can extend from one hour to a maximum of seven hours. That could bring long-haul rides into play, as well as those short hops for errands and appointments.
Where is this new service available?
Initially, hourly service will be limited to Atlanta, Chicago, Dallas, DC, Houston, Miami, Orlando, Philadelphia, Phoenix, Seattle, Tacoma, and Tampa Bay.
This is an interesting mix of cities. With the exception of Chicago and perhaps Philly, the cities seem to be localities where there wouldn’t be an overabundance of limousine or Town Car (aka, black car) services. But even in bigger cities, Uber might win out. When compared to what it costs to rent a limousine, Uber’s prices are extremely competitive.
How much will Uber charge for this service?
The cost to riders will be $50 per hour, with a one-hour minimum and mileage overages varying by location. In its press release Uber doesn’t mention tipping drivers, but we can assume—and hope—it will be offered as an option like it is for regular rides.
Uber’s new hourly service is far more economical than renting a limousine and driver, which costs (on average) $90 to $130 per hour, often with at least a three-hour minimum. Town Cars, at around $60 per hour, are more affordable than a limo but often carry a two-hour minimum or more—and they still cost more than Uber’s new service.
Uber seems to have stepped into a nice niche here. The price is within reason, and the service is something many riders will want. Also, the flexibility of ordering a car for just one hour will undoubtedly be appealing. Will it turn out to be a big money maker? At this point, no one knows.
No specifics have been released about Uber’s take of the $50 hourly charge, but we’re guessing it will be at least 20%, and maybe 30%. For you as a driver, that means earning between $35 and $40 per hour. You’ll have to figure out for yourself whether that’s better than what you’d get with single rides. Before you decide, though, let’s look at a few more issues.
Do drivers have to accept hourly rides? Do all drivers qualify?
Uber’s hourly service is optional for riders as well as drivers. There will be accommodations in the app for both groups to use when choosing whether or not to participate.
Here’s what the in-app experience would be like if you opt-in as a driver:
Here’s the sequence of screens, with instructions, for customers.
As you can see, hourly rides will be requested from a separate segment of the app, and the passenger will enter stops as part of the ride. So on your end, you’ll know upfront how many places you’ll be going, and for how long.
Before you get too excited, though, be aware that not all drivers will be eligible to give hourly rides.
In its May 20, 2020 press release about the new hourly service, Uber tells potential passengers: “You’ll be matched with a driver who has a more spacious and newer vehicle make / model of cars that are eligible for Uber Comfort.” In other words, if your vehicle qualifies for Uber Comfort (check this article to find out), it should also qualify for the new service. And of course you’ll need a high rating, a clean car, and a commitment to follow guidelines for protecting against the spread of COVID-19.
If you qualify, and the hourly service is coming to your town, there are some good reasons for opting in. One of these is its appeal to your potential customers.
Why will riders like (or not like) Uber’s new hourly option?
If you’ve ever taken a rideshare trip as a passenger, you know it’s as much of a crap shoot as driving is. Your driver could be fabulous, clean, and efficient—or ornery, smelly, and anything BUT a model motorist. Also, there are those long waits that make a short trip take a long time. This happens a lot nowadays, with so few drivers out on the road working.
What if you could avoid having a cramped car, make sure you get a highly rated driver, make multiple stops, and not need to call more than one car? If you were a customer, you’d like all those improvements. Here are some others:
- One car = one driver, and less potential for exposure to COVID-19
- No need to wait for a new Uber car after every stop
- No carrying everything from place to place; customers can leave dry cleaning in the Uber while they shop for groceries
- Ease in dropping off and escorting children or others who need to be accompanied to doctor appointments, music lessons, etc.; the Uber driver can wait until the person doing the escorting finishes the drop-off
- Airport runs and extended rides might be cheaper, depending on the time and distance involved
- Long-distance trips can be arranged in a way that might be more economical.
Why would customers not like the hourly service? Availability might be an issue. Because the requirements for drivers are relatively strict, there won’t always be a car within five minutes of the pickup point. Also, if a passenger gets a driver they don’t like, they’ll be stuck with that person for at least an hour.
That particular situation—being required to stay with one person for more than a short ride—goes both ways. Passengers won’t be the only ones with things to like and not like about Uber’s hourly service.
What’s in it for drivers? What’s not so good?
There are definitely things to like about the hourly option. Depending on your situation, it can be a lot easier than taking one rider after another. Here are some positives that immediately come to mind:
- One passenger = less exposure to COVID-19
- Single ride for one hour = one-time sanitizing process for your car
- Guaranteed hourly rate
- Less need to cruise around empty, hoping for pings
- Good possibilities for bigger tips; the longer they know you, the more they’ll like you
- Finding out up front how long the trip will take
But like everything else in life, along with the positives there are negatives, including:
- Dealing with parking while waiting
- The need to get along with a rider who seems unruly or unreasonable for a period of an hour or more
- The possibility of grocery bags and their contents spilling, and making a smelly mess in your car
- Missing out on surges at rush hour, events (after the lockdowns end), or the airport, where you might have a chance to make a better rate
What do you think?
Will this new service change your game, or will it be the same old stuff? We encourage you to tell us what you think in the comment section below. Also, if you haven’t already done so (seriously???) make sure to download the Gridwise app to track all your earnings. That way, if you decide to work the hourly way, you can get the hard numbers to tell you if it’s working for you or not.
And remember, you can find lots of information about making the most of your driving and delivery gigs on our driver-savvy blog. Find it in the Gridwise app’s Perks tab or on our website. And—be sure to tune in for Brandon and J’s fast-paced and fierce video podcasts!
