American ride-hailing company Uber recently announced that after studious evaluation, the company decided to increase the charge of its services provided in Hong Kong by 80%.
Meanwhile, Uber emphasized that its operating capital in Hong Kong does not have any problem.
Uber said the price increase covers services like UberX, UberASSIST, and UberBLACK. The service starting fee of UberX and UberASSIST will be increased by 80% to HKD45; while the service starting fee of UberBLACK will be increased to HKD65.
According to the company, the price increase is based on an evaluation of the Hong Kong market and it will bring more income to Uber drivers. However, these fees are lower than hailing a regular taxi, so it's unclear how the fee increase will positively impact drivers for Uber in Hong Kong.
But a fare increase in Hong Kong may not have any impact, too. In Hong Kong, many places outside of the main island are void of good taxi coverage, so Uber may be able to penetrate these areas in the Northern Territories and Kowloon.
In addition, Uber accepts many more payment methods than Hong Kong taxis, which only accept cash. Even with the ubiquitous Octopus payment card in Hong Kong, those Octopus cards are not usable in taxis. So if a rider wants to pay with a credit card or PayPal, then Uber may be a better choice.
So by using payment choice alone as a reason for choosing Uber over local taxis, Uber's increase in fares may do little to dent its impact in Hong Kong.