Free Now has announced changes to its application to order a taxi. These, unsurprisingly, have been in price. And, of course, upwards. Following the official taxi rates -it is one of the requirements that Free Now has to meet if it wants to operate with the public service-, the platform can make variations in the supplements. In this case, with a rate that seemed to be associated with Uber and Cabify’s VTC business, Free Now adds the charge for high demand.
As announced by the company in a statement, they eliminate the sustainability charge. 30 cents that they dedicated to invest, as they explain, in the green growth of the company. However, the disappearance of this supplement has opened the door to two others. On the one hand, the previously mentioned charge for high demand. This can range between the 0.05 and the 1.50 euros; variable depending on the availability of vehicles at that time. Secondly, €0.80 service charge mandatory in each of the services contracted and paid through the application. That is, from 30 cents of obligatory payment, it is passed to one that can oscillate between 80 cents and 2.30 euros maximum.
The company announces that this will be applicable to all taxis in Spain associated with Free Now from August 16.
What will this increase be dedicated to? Free Now maintains the sustainability charge policy. As they explain, “it will be to maintain a good service and continue investing to improve technology,” they point out. In other words: the taxi driver will not receive any percentage of the price increase inside the platform.
It is a way to increase the income received by the company in its intermediary service in the sector. Also an expected evolution. Free Now, at the time MyTaxi, became popular due to the discounts and gift rides within its platform. Some that were eliminated for failing to comply with the competition regulator. But they already had the users conquered. The taxi drivers were the ones who assumed the cost of the rates for the intermediation and recruitment service that the platform provided. Now, and having already conquered the sector of professionals and users, it is time to share the expenses. A process that has been replicated in a large part of the service platforms -either delivery or transportation- for a while now.
The problem of high demand in Free Now
What is considered high demand and when does this fee come into play? This is one of the biggest complaints that users of the Uber and Cabify VTC universe have about their service, especially during events in big cities. In fact, with these rates, the models of the transport platforms stopped having prices for a long time. significantly lower than the regulated taxi. For some time now, the rates have been equalizing and, on many occasions, being above the average for a taxi.
Free Now wants to mimic this model, but trying to contain fees that can lead to 3-digit numbers if demand is high. Keeping the limit up, up to 1.50 euros. In this way, they want to avoid situations like the ones Uber users suffered during MadCool, the capital’s music festival. The great mass of attendees, the impossibility of many taxis to reach the venue and the few means of transport available, increased the demand for platform vehicles and, therefore, their price. Question that the clients themselves criticized the technology.
On the other hand, when does this rate come into play on Free Now routes? It will not always be active. Company accounts and cash payments to the driver are exempt from the dynamic rate. One that will come into force when the current demand exceeds 20% of the weekly average. Which means that, each week, this may be variable depending on the activity. Evening hours and events will have a more than sure charge from mid-August.