Uber’s new competitor GoCar promises ‘no surge pricing’

THIS man claims he has the solution to the most frustrating part of being an Uber rider. But will it really save you cash?

UBER, your price gouging days are numbered.

That’s the rallying cry of a new ridesharing platform that promises to give both riders and drivers a better deal.

GoCar, a ride sharing service housed within taxi booking app GoCatch, is now taking bookings in Sydney, with plans to roll out nationally when the time (and law) is right.

“Uber has had a grip on the market for long enough,” said GoCatch founder and chief executive Ned Moorhead.

The newcomer, backed by high-profile investors including James Packer, promises to shake things up with lower driver commissions and, crucially, an end to the “horror stories of riders unknowingly spending hundreds of dollars to get home”.

Like Sydney woman Skye Shanahan, stung $720 for an Uber ride from Neutral Bay to Blacktown, or Perth man Kris Keen who was charged $332 for a 20km trip.

“Having a locally-owned Australian-made ride-sharing platform will provide much needed choice and competition,” Mr Moorfield said.

“We will have set peak and off peak rates rather than surge pricing, which we know everyone hates.”

He took a swipe at Uber’s legal dispute with the Australian Taxation Office, saying that “we will make it easy for drivers to operate legally and effectively while paying our fair share of taxes”.

Uber is fighting the tax office’s ruling that its drivers must pay GST, and in the meantime raised fares by 10 per cent last August.

BUT WILL IT BE CHEAPER?

The reality is, it depends on how often you travel during peak times, and whether Uber happens to implement surge pricing during your trip.

“Certainly there’ll be times when we’ll be more expensive, but broadly we’ll be more cheap,” Mr Moorfield claimed.

Let’s see how the numbers stack up.

GoCar’s peak times are from 6am to 10am, Monday through Friday; from 5pm to 10pm, Monday to Thursday; and from 6pm to 2am on Fridays and Saturdays.

While GoCar matches Uber’s pricing during all other times, during peak times it is about 45 per cent higher than Uber’s base rate, and about 15 per cent cheaper than a taxi.

Essentially, you’re paying a premium to avoid the risk of a surge price being imposed.

A 20-minute ride that would cost $32.25 during off peak times with both UberX and GoCar would cost $47.09 with during GoCar’s peak, compared with a $55.41 taxi.

Considering the fact that surge prices can be as much as 1000 per cent higher, GoCar is betting on passengers opting for certainty.

Of course, you can always switch between the two apps and check whether Uber is surging, before deciding who to book with.

This could lead to a price war like that seen in the United States between Uber and rival Lyft, which last month slashed its prices.

GoCatch founder Ned Moorhead is shaking up the ridesharing market.

Like Uber, GoCar requires drivers to submit to criminal background checks, but another point of difference is its rating system.

Instead of Uber’s confusing five star system — which leaves drivers under threat of being booted off the system if their average drops too low — GoCar uses a simple thumbs up or thumbs down rating.

While GoCatch has 35,000 taxi drivers on its platform, Mr Moorfield would not reveal how many drivers GoCar had, but said it included current and former cabbies.

“For those with a good history, we’re more than happy to bring them across,” he said.

“We’ve got a good core base of drivers in Sydney ... We’re charging drivers a 15 per cent commission versus Uber’s 20 per cent and we’ll pay them faster — daily rather than weekly.”

For the moment, GoCar is only available in Sydney’s CBD, eastern suburbs, lower north shore and inner west. Mr Moorfield is gearing up for another funding round to extend its reach.

He said GoCar’s drivers were welcome to use both platforms, assuming Uber — which maintains that its drivers are not employees — allowed them to do so.

Uber general manager for Australia and New Zealand David Rohersheim said: “We’re proud to have led the way in bringing ridesharing to Australia. Consumers are now enjoying more choices than ever in how they get around their city.”

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Originally published as Uber’s new competitor GoCar promises ‘no surge pricing’