UberEATS introduces surge pricing in some US cities
Uber is to introduce surge pricing for its UberEast food delivery service during periods of high demand in specific neighbourhoods in some US cities, including Phoenix, Houston, Dallas, DC, Miami and Atlanta. The money from the extra charges will go to "incentives for delivery partners" in addition to other operation costs such as predictive analysis.

UberEats now officially feels more like Uber than Grubhub.

The ride-sharing company's food delivery service will start incorporating surge pricing in select cities, Uber product manager Ben Dreier announced in a blog post(opens in a new tab) Thursday.

Dreier didn't actually use the phrase "surge pricing." Instead, he said that UberEats customers would "pay more for delivery" when demand is high.

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"There are still times when there aren’t enough delivery partners in a particular area to complete every delivery request at Uber speed," Dreier wrote(opens in a new tab). "That’s why we’re asking UberEATS customers in select cities to pay more for delivery when they order from restaurants in areas where demand is high but delivery partners are scarce."

Uber has long implemented surge pricing for its ride-hailing services, but UberEats has so far been exempt from the added fee applied during times of high demand.

UberEats won't be the first food delivery service to apply surge pricing. Postmates also activates surge pricing during periods of high demand for its similar fleet of contract delivery couriers.

But the food delivery market is crowded, with competition from delivery giants Grubhub and Seamless and even Amazon. UberEats has quickly gained a significant market share since its launch last year, but notable surge pricing could cause customers to turn to other options with fixed delivery fees.

An Uber spokesperson said the first cities to be affected by surge pricing will be Phoenix, Houston, Dallas, DC, Miami and Atlanta. The surge pricing won't be applied across cities. Instead, it will target specific neighborhoods that are experiencing high demand.

The surge pricing won't be exactly the same as on the regular Uber app. An arrow below a restaurant's name will alert users to the fee. The exact amount will appear above a restaurant's menu and as a line item before checkout and on a receipt, Uber said.