Record gasoline prices in Canada are worrying taxi and ride-hailing app workers across the country, many of whom are struggling to make ends meet.
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Earla Phillips, a longtime Uber and Lyft driver in Toronto, said that before the gas price hike started, a half tank on her $30 sedan would get her through the day. Now she finds herself spending $50 and working overtime to make up the difference.
“It’s been very difficult,” Phillips told Global News.
“Nearly doubling the cost of operation with gasoline prices means we’re… being paid a lot less than just a year ago – and that’s really tough,” she said. .
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Linda Caswell, who started driving for Uber Eats in February as part of a side job to earn extra money, said she was making nearly half of what she started.
With income drying up, Caswell now plans to spend less time on the road and look for other remote home options to help pay off his debt faster.
“It’s really disheartening,” the Mississauga city worker told Global News.
Taxi drivers are also feeling the pinch of soaring gasoline prices, mainly due to Russia’s invasion of Ukraine and corresponding sanctions against Moscow.
Mohan Kang, President of the British Columbia Taxi Associationsaid it was an essential service, there is no escape or shortcut trying to get around exorbitant fuel costs.
“We are very concerned about the rising price (of gas),” he told Global News.
“I can park my private car at home and only use it when essential, but in case of taxis we have to be on the road to provide that service to communities.”
Kang said there was a “drastic” direct impact on taxi drivers as rising fuel costs eat away at their daily income.
Is the fuel surcharge useful?
To help offset high gas costs, Uber and Lyft introduced a fuel surcharge in March that is still in effect until further notice.
Lyft added a $0.55 fuel surcharge each ride and Uber charges riders an additional $0.50 for each ride.
“It is important to say that this surcharge is temporary and designed to try to maintain high incomes during this difficult time,” Uber said in a post announcing the changes on May 11.
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However, this did little to fix the driver issues.
Caswell said a $0.35 surcharge for Uber Eats deliveries which is end scheduled for June 15 is a “mediocre amount” that “didn’t make a difference”.
Phillips said a flat rate of $0.50 was “not good enough,” especially for long hauls. As discussed on online forums, most drivers support a per-mile surcharge, she said.
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“Quite often we do longer journeys and it just doesn’t impact or compensate us fairly for the increased operating costs.”
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Experts say the fixed adjustments may offer some relief to drivers, but it’s not enough to counter rapidly rising fuel prices, which are expected to remain high or even rise in the weeks and months ahead.
“It’s a very small extra and I don’t think it explains the drastic rise in fuel prices,” said Patrick De Haan, head of oil analysis at GasBuddy.
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Additional fuel costs could potentially deter drivers from using the apps, he said.
“It’s a very precarious problem. It’s hard to navigate, given that many of these drivers and many of these delivery services rely on low fees to succeed.
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Canadian carpooling app Uride added fuel charges in the majority of cities where it operates, as well as an increase in the rate per kilometer and per minute to reflect the additional costs drivers incur due to fuel and inflation .
In addition to closely monitoring gas prices and adjusting fares as needed, the company told Global News that it checks on drivers weekly to see how they are doing and what challenges they are encountering.
“It’s been scary for a lot of drivers,” Cody Ruberto, founder and CEO of Uride, said in an email.
“Gasoline isn’t the only challenge drivers face. Some drivers have been waiting for auto parts for many months due to supply shortages.
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More and more drivers are turning to carpooling to reduce their gas costs.
Poparidewhich provides a city-to-city ride-sharing service in Canada, has seen an 80% increase in the number of drivers registered on its platform since March 1, 2022, the company told Global News.
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“Over the May long weekend, we saw record 800% year-over-year growth as gasoline prices and inflation hit new highs,” said Joe Kitos, vice president of marketing at Poparide, in an emailed statement.
Although the company did not introduce a fuel surcharge, it adjusted its maximum price from 15 cents per km to 17 cents per km.
“Additionally, drivers have the flexibility to set the price for each ride, as long as they don’t exceed our platform-wide maximum price,” Kitos said.
How can drivers be supported?
In an email response to Global News, Uber said the recent spike in gas prices has affected rideshare and delivery drivers more than most.
However, the current earnings are among the highest the company has ever seen for drivers across the country, according to Uber.
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In Canada, as in the United States, Uber drivers are considered independent contractors.
By contrast, UK Uber drivers are classed as workers, entitled to minimum wages, holiday pay and a pension plan. The change was introduced in March 2021 following a Supreme Court ruling.
Ming Hu, a professor of business operations and analytics at the University of Toronto’s Rotman School of Management, says to better support long-term Uber drivers in Canada, there should be similar legislation that compels the platform to classify them as employees.
“In this case, the drivers are insulated from any fluctuation in the price of gasoline and society will absorb that volatility,” he told Global News.
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As things stand, Canadian Uber and Lyft drivers may have the flexibility to work their own hours, but their earnings are largely dependent on rates set by ride-sharing companies.
“We have no control over the rates paid to us and we have no ability to negotiate those rates,” Phillips said.
She said raising fares as the industry reeled from the effects of soaring petrol prices would only be fair to drivers “in pain”.
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Uber says it is always seeking feedback through multiple channels from drivers using the platform.
Next week, the company plans to hold a roundtable with drivers in Toronto.
“I really hope Uber changes something because I would like to continue doing it…but as it is right now, it’s not really something I can do anymore,” Caswell said.
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