Smartphones

Uber fails to make the grade with the Better Business Bureau

An illustration picture shows the logo of car-sharing service app Uber on a smartphone next to the picture of an official German taxi sign in Frankfurt, Germany.

An illustration picture shows the logo of car-sharing service app Uber on a smartphone next to the picture of an official German taxi sign in Frankfurt, Germany.  (REUTERS/Kai Pfaffenbach)

Uber, the smartphone-based car service app that claims to provide cheaper alternatives to a standard taxi ride, failed to make the grade with some consumers. On Thursday, the company that is popular with urban customers looking for less expensive travel fares received an “F” rating from the Better Business Bureau – the organization’s lowest rating. The rating for the San Francisco-based company was aggregated from over 90 customer complaints posted to the BBB site over the past three years. What was the main complaint? Most posters to the site took issue with the company’s surge pricing. Fares can increase from as low as one-and-a-half to as much as ten times the typical cost of a ride from the on-call travel service during in-demand times for rides. On a busy weekend night in urban areas like San Francisco and New York City, for instance, the fares go up consistent with demand.

Some consumers complain that the surge policy is not clearly explained and that when contacted, customer service has not been very helpful.

One post to the BBB site from Sept. 30 complains that a consumer was charged nearly ten times the normal rate without any advance notification.

“They charged me 9.5x what the rate should have been without any notification,” reads the complaint. “The car ride should of cost me between 10 and $13 according to there posted rates on website … Afterwards they said it was because it was a ‘busy time’ and that they hike up the prices then.”

While the surge pricing policy has some users up in arms, Uber does notify costumers when surge pricing is in place, and requires confirmation from the user before he or she ultimately requests a trip.

“Uber has revolutionized riders’ ability to provide feedback in cities like San Francisco where consumers filed nearly 2000 unanswered complaints against taxi in one year alone,” according to Uber in a statement to FoxNews.com. “Uber’s direct channel for two-way feedback is regularly reviewed and acted on to ensure a high-quality experience. The fact is that consumers in 220 cities around the world have made their opinion known by taking millions of rides with Uber.”

The BBB is a nonprofit organization that aims to serve as a consumer watchdog by offering reviews of a wide range of companies. The organization is certainly not without its own critics. A 2010 ABC News investigation took a look at accusations against the Bureau that it ran a “pay for play” scheme. The BBB has been accused of awarding its highest rating – “A plus” – to companies that pay membership fees.

Also, Uber is not the only urban travel company getting low marks. For instance, both YellowCabNYC and Yellow Cab Cooporative Inc. of San Francisco each have “F” ratings, as does Uber’s chief competitor, Lyft. It should be noted that each of these companies received fewer than 10 complaints over the past three years, significantly less than what has been posted about Uber on the site.

Beyond the BBB, traditional taxi services – long a source of consumer complaints – have made a negative mark in the news. There were over 1,700 passenger complaints to the official  San Francisco complaint line against the city’s taxi industry from July 1, 2011 to June 30, 2012, according to The Bay Citizen.