Big news coming from Uber late Friday afternoon: Uber has announced a fuel surcharge for drivers and couriers, with 100% of the surcharge going directly to drivers.
What does this mean for drivers and couriers? When will it roll out? We’ll break it all down for you below!
Lyft Announces New Fuel Surcharge
On Monday, March 14, Lyft announced it would also be adding a new fuel surcharge to benefit drivers. According to Lyft’s blog post, beginning next week:
Lyft is adding a $0.55 fuel surcharge to each ride that’ll go directly from riders to drivers… This will help offset fuel costs, which also helps more drivers stay on the road. Drivers can expect these additional earnings for at least the next 60 days.
-Lyft blog post
More information from Lyft shares that EV drivers will also see the additional earnings. On the other hand, things are a little different for NYC and Nevada drivers:
New York City just raised the minimum earnings standard for drivers by 5.3% in early March due to increased expenses, so the surcharge will not apply there.
In Nevada, regulatory requirements prevent us from rolling out the surcharge immediately. We are working hard to bring it to drivers there as soon as possible.
Lyft blog post
Uber Introduces New Fuel Surcharge
Uber is rolling out a temporary fuel surcharge to support drivers, paid for by passengers and customers.
Uber Rides customers will pay a surcharge of either $0.45 or $0.55 on each Uber trip, and Eats customers will pay either $0.35 or $0.45 on each Uber Eats order, depending on their location.
100% of those surcharges will go to drivers.
The surcharge is temporary for the next 60 days, and Uber will continue to monitor gas prices. Uber may make additional changes depending on how gas prices continue to fluctuate.
The fuel surcharge will launch on Wednesday, March 16.
How Much Extra Can Drivers Earn?
First, the amount you’ll earn via the surcharge depends on which city you drive in. All drivers will receive a message in their Uber app notifying them how much they’ll earn based on where they drive.
Breaking this out, let’s say you’re a full-time California driver who gives 70 trips a week, driving 1000 miles a week (pretty typical for full-time drivers). Prior to the rise in gas prices, you may have spent around $184 per week (1000 miles a week with a 25 MPG vehicle at $4.60/gallon).
Now, with gas prices in California around $5.80, you’re spending $232 for that same 40 gallons – an increase of $48/week. In this scenario, you’ll still be paying an extra $13/week – but Uber is covering the majority of the increase.
Basically, drivers aren’t getting rich off this fuel surcharge, but the fuel surcharge should help in most cases.
Overall, is 45-55 cents per trip that much of an incentive for drivers? For short rides, sure, this could add up and be helpful. It really depends on how much gas prices have gone up in your area and the MPG your car gets.
Long Term Planning
In their announcement, Uber specifically mentions “the key to reducing the impact of gas prices on your earnings is to make the switch to an electric vehicle” highlighting their focus on helping drivers go electric as part of their zero-emissions platform.
Currently, this is what Uber is offering drivers to help them go emissions-free:
- Higher earnings:
- Drivers who drive battery electric vehicles receive extra incentives, such as $1 more per trip up to $4,000 annually through our Green Future Program
- EV purchase & rental discounts:
- All US drivers are eligible to receive $6,000 off the Nissan LEAF, a best-in-market discount exclusive to Uber.
- Drivers can get discounted pricing from local certified dealers on new and used EVs through TrueCar.
- Drivers with a 4.85 rating and 100+ trips can rent a Tesla through Hertz.
- Drivers in select markets can also rent EVs with Avis, Drive Sally, Hive, Flux, and HyreCar.
- Charging discounts:
- All US drivers are eligible for discounts on EVgo charging, including up to 30% off for Uber Pro Gold, Platinum, and Diamond drivers.
- All drivers are eligible for $200 off a Wallbox home charger and installation, with the option for monthly financing.
- All drivers are eligible for a $150 discount on a JuiceBox home charger with Enel X.
- Drivers in California are eligible for a discount on a solar roof installation with SunRun.
If you’re considering getting an EV, check out our Uber & Lyft EV Drivers Facebook group.
Uber is Listening!
When we asked drivers on the RSG Facebook group, many of you stated a fuel surcharge would be a good first step, but that you really wanted Uber to listen and understand what drivers are going through.
On the pro side of this news, Uber is listening! They quickly implemented a fuel surcharge on passengers for drivers, something only Grubhub had done so far/as of this article’s publish date.
On the con side, is 45 to 55 cents per trip enough to handle the increase in gas prices in your city? That depends on a lot of factors, including how much you drive, how expensive gas is in your area, and what your gas mileage is like.
Takeaways for Drivers
If you have a car that doesn’t get great miles per gallon, this new fuel surcharge doesn’t do much for you if you do a lot of long trips. However, if you do shorter trips or have a hybrid, this could make a difference and help to offset costs – maybe even entirely.
Uber Driver Gas Prices Survey Results
The Rideshare Guy sent out a short survey to our audience via e-mail and on social media and collected 325 responses from 3/7-3/11/22.
A majority of Uber and Lyft drivers have quit or are driving less due to high gas prices.
- No change/driving the same – 36%
- Driving more – 11%
- Driving less – 38%
- Quit driving because of gas prices – 15%
53% of drivers are driving less or not at all because of gas prices. 15% of drivers actually quit because of high gas prices. And for the 38% of those who are driving less but haven’t quit entirely, the majority have said:
- They’re either avoiding long trips entirely,
- Only driving when offered promotions,
- Or seriously considering buying an electric vehicle or hybrid.
Many drivers shared that they feel like Uber and Lyft haven’t responded quickly enough to the predicament of high gas prices and several said there should be a surcharge or other fuel charge on passengers, especially for longer rides. Well, they got their wish with today’s announcement!
Teddi B from Chicago says “I only drive on my way to work and a few trips over the weekend to keep my Gold status. Doing the ASU scholarship, I will graduate in a year and then I’ll be able to get a much better job!”
It was definitely surprising that 11% of drivers indicated they’re driving MORE during the latest gas price surge. But several of these drivers mentioned they’re already driving EVs, while others said they’re driving more out of necessity to pay bills.
Some drivers who quit cited the high cost of fuel as being the thing that pushed them over the edge. Randall L from California said:”The extremely high price of fuel makes every Uber X trip not worth it. After a few hours of driving, I have to drop at least $60.00, which eats over 60 to 70 percent of what I earned in the driver app. I drive a Ford Fusion SE with a 2.5L 4 cylinder engine. It would be possible to make a little something if I had a hybrid. It’s very disappointing that the companies aren’t helping drivers with these high prices when they already take 60% of the fare.”
Fred B said “The lack of bonuses, surge and Quests make driving a money-losing prospect. I don’t see how I can make money in the current situation.”
Update to New Fuel Surcharge News: How Have Drivers’ Habits Changed?
The Rideshare Guy sent out a short survey to our audience via e-mail and on social media and collected 252 responses from 3/22-3/24/22.
How are drivers changing their driving behavior in response to the surcharges?
43% of Uber and Lyft drivers still say they’re driving less or have quit completely despite the new fuel surcharges. This compares to 53% of drivers who said the same, before the fuel surcharges were announced.
Many drivers say that the fuel surcharges are not enough and they would have preferred to see a per mile surcharge to account for the increased fuel expenditure on long trips instead of a flat fee.
- No change/driving the same – 43%
- Driving more – 14%
- Driving less – 30%
- Quit driving because of high gas prices – 13%
Previously, we sent out a short survey to our audience and collected 325 responses from 3/7-3/11/22. Here’s how the numbers compare to driver sentiment before fuel surcharges:
|No change/driving the same
|Quit driving because of gas prices
Driver sentiment on Uber vs Lyft surcharges
We see that Uber drivers were slightly happier overall with the surcharges compared to Lyft drivers which is interesting because the surcharges were comparable and Lyft also added additional cash back opportunities on gas purchases for those drivers using the Lyft debit card.
39% of drivers said they were NOT satisfied with the Uber fuel surcharge that was announced. Only 28% of drivers were satisfied with the Uber fuel surcharge:
42% of drivers said they were NOT satisfied with the Lyft fuel surcharge that was announced. Only 21% of drivers were satisfied with the Lyft fuel surcharge:
Overall, the full data set shows that there were more dissatisfied drivers than satisfied, and here’s some of the most common feedback we received:
- The fuel surcharges should have been applied on a per-mile basis vs per trip, to account for longer trips
- Many drivers asked what took so long – why did Uber (and then Lyft) delay their announcements and then delay implementation when this problem had been fomenting for several weeks?
- Others said the additional fuel surcharge doesn’t do enough to make a difference – some cited inflation rising faster than what this fuel surcharge covers, others stated it doesn’t cover the increase in gas in their cities.
If you’d like to cite these survey results, please link back to this page as the source. The Rideshare Guy is the number one destination for gig workers to stay up to date and informed on the industry.
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What do you think of this news from Uber and Lyft?
-Melissa @ RSG