Ride hailing app Bolt is planning to allow its drivers to set their own fares in a bid to slash the number of cancelled bookings.
The Estonian start-up, which aims to rival Uber in the mini-cab app market, said it will trial the scheme from this week.
It comes after Uber last week announced plans to up fares in the London by 10 per cent.
Bolt says it hopes allowing drivers to set fares – within a limit set by the firm – will reduce the number of cancelled bookings because of ‘multi-apping’.
As previously reported by MailOnline, drivers have been running multiple apps, such as Uber, Bolt and FreeNow, at the same time in a bid to find the best fares.
But it means customers are having jobs accepted only to have them cancelled minutes later – ultimately leading to longer wait times.
Ride hailing firm Bolt is planning to allow its drivers to set their own fares in a bid to slash the number of cancelled bookings. The Estonian start-up, which aims to rival Uber in the mini-cab app market, said it will trial the scheme from this week
Bolt hopes its new scheme will cut down on cancelled trips by allowing drivers to ensure jobs are profitable before accepting them.
Analysis: What does the Bolt move mean for customers?
Drivers hoping to recover money lost during the barren months of last year’s Covid lockdowns have been demanding higher fares from ride-hailing firms such as Uber and Bolt.
They also say that changes to Uber’s own charge, from 20 to 25 per cent, has led to some jobs become unprofitable.
Drivers previously told MailOnline how this has led to an increase in multi-apping – where drivers use multiple ride-hailing apps to search for the best fares.
That has led to an increase in wait times for customers, who are having their jobs cancelled when a driver finds a better offer.
Bolts hopes that by giving drivers the ability to set their own fares, within a limit, it will lead to less cancellations because drivers will be agree a fare they are happy with before accepting the job.
But this could lead to drivers pricing out unprofitable jobs – like short distance journeys that take a long time due to traffic – as drivers set higher prices to try and avoid the job.
On the positive side for customers, more profitable jobs – short quick trips or long but easy journeys – could become cheaper, as drivers bid low to get the business.
Unions meanwhile have accused Bolt’s new scheme of creating a ‘false pretence’ of driver control and will push down prices by incentivising drivers to take lower offers.
They are urging Bolt to set a minimum price rate of £2-per-mile.
Sam Raciti, Bolt’s manager for western Europe, said: ‘Drivers have consistently asked us for the ability to set their own prices so they can ensure a journey is profitable enough before it’s accepted.
‘By making these changes we hope to reduce waiting times on the Bolt app and have fewer driver cancellations so customers can get to their destination quickly and safely following increased demand in recent weeks.
‘We have built our business around giving drivers total flexibility.
‘These changes are part of that philosophy and will create a better functioning marketplace.’
The ability for drivers to choose their own prices will be tested in several UK cities from this week ahead of a planned rollout across the country before Christmas.
Drivers will be able to select their prices within a range, or use Bolt’s standard pricing which varies based on supply and demand.
A feature allowing passengers to select their driver from a list is also being introduced.
However union bosses are unhappy at the move, because they believe it will drive down prices for drivers.
A spokesperson for the App Drivers & Couriers Union (ACDU) said: ‘Bolt’s new pricing model is a desperate attempt to avoid accountability for worker rights for their workforce by creating a false pretence of driver control in price setting.
‘In reality, Bolt’s work allocation algorithm will quickly profile and prioritise drivers who are prepared to accept ever lower prices for their work allowing Bolt to expand market share at worker’s expense. The ADCU will continue its ongoing court action against Bolt for worker status.
‘This programme also raises serious safety concerns associated with a substantial workload increase as drivers must now assess and bid on work offered whilst out on the road.
‘If Bolt want to proceed with this plan, they must set a price floor of £2.00 per mile and allow drivers to set prices higher that this if they wish.
‘In London, regulation requires that operators like Bolt provide a price quote before a journey commences. The purpose of this regulation is to give customers certainty and security of a simple pricing model.
It comes as rival firm Uber (pictured: Library image) increased its prices in London by 10 per cent last week in an attempt to attract more drivers
‘This initiative undermines the regulatory regime and essential consumer protections.’
It comes as rival firm Uber increased its prices in London by 10 per cent last week in an attempt to attract more drivers.
The ‘perfect storm’ of problems facing the taxi industry: Why have cabbies left and why have they not returned?
– Tens of thousands of drivers left the industry during last year’s Covid lockdowns when demand for taxis and private hire vehicles plummeted
– Some took their cars (often drivers with smaller vehicles) and joined takeaway delivery firms which saw a huge spike in demand during lockdown
– Others who had taken cars out on finance prior to the pandemic sold up and joined other firms such as Amazon
– But taxi and private hire firms, including Uber, have struggled to attract drivers back
– Uber drivers have previously told MailOnline how an increase in Uber’s cut has made journeys barely profitable
– Meanwhile, unions have raised safety concerns for ride-hailing app drivers following a spate of violent attacks
– The LPHCA has now warned that backlogs in local council licensing departments mean new taxi and private hire drivers and those wanting to return are being delayed
As previously reported by MailOnline, thousands of drivers ditched mini-cab work during the pandemic when demand plummeted.
Many joined takeaway delivery firms, including Uber’s sister firm Uber Eats. Uber said told MailOnline in August that it was planning to sign-up an additional 20,000 drivers across the UK to meet demand as more workers return to the office.
The price hike – Uber’s first since 2017 – also included a ‘peak time’ fare rise for airport trips up 25 percent.
Bolt, a ride-hailing app competitor to the more established Uber, said it has ‘grown rapidly’ in the UK since launching in London in 2019, due to having commission rates which are lower than those charged by other companies.
The firm added that it has more than 65,000 drivers and four million customers across 14 English cities.
It come as industry chiefs warned how more than half of the UK’s cabbies have quit since the start of the Covid pandemic sparking a shortage ‘worse than the HGV driver crisis’.
The Licensed Private Car Hire Association (LPHCA) earlier this month estimated the UK’s taxi and private hire industry is short of 160,000 of the previously 300,000-strong workforce.
The trade association says tens of thousands of drivers quit the industry to work for companies such as Amazon as demand collapsed during last year’s Covid lockdowns.
And they say that delays in licensing – handled by local councils – has hampered their efforts to bring in new drivers.
The shortage has prompted concerns over the safety of women, students and night time workers struggling to get home.
And bosses of the LPHCA warn that the crisis is now worse than the HGV driver shortage, which earlier this year left petrol stations without fuel and which could spark supermarket shortages this Christmas.
Steve Wright, from the LPHCA, told MailOnline: ‘It’s a perfect storm really. A lot of drivers left the industry during the pandemic, and many haven’t come back.
‘Quite a few went to Amazon to do delivery driving because they bought their cars on finance (before the pandemic) and because there was no work, they couldn’t afford them.
‘We are still trying to get a lot of those drivers back that left because they had to get other jobs – they have mortgages to pay and children to feed.
Steve Wright, from the LPHCA, told MailOnline: ‘It’s a perfect storm really. A lot of drivers left the industry during the pandemic, and many haven’t come back.’
‘Also, many of the local councils basically shut down their licensing offices during the pandemic and so there’s a huge backlog of applications now which is slowing things down.’
Asked the scale of the problem, he said: ‘This is a really really big concern. There’s been a lot of talk about the HGV crisis but this is worse.
‘And it is impacting on businesses as well, like pubs and clubs and restaurants, because people don’t know if they are going to be able to get home.’
‘I even went to a trade meeting a few weeks ago and we couldn’t get cabs home.’
Mr Wright, who has been in the industry since 1973, called on the Government to step in and help clear the backlog.
Under current rules taxi drivers must apply to their local council for a licence as either a taxi driver of private hire.
Taxi drivers, such as black cab drivers, are allowed to be hailed on the street, while private hire cars, including Uber vehicles, must be booked in advance.
Licences can cost up to £600 a year and drivers must also obtain a criminal record check and medical check. In some cases a ‘Knowledge’ test, where drivers must demonstrate their impeccable knowledge of the local roads, is required.
Because of safety concerns, these background checks are important and can take time.
Industry chiefs, however, warn that councils are now facing a backlog having been disrupted during the pandemic.
The Local Government Association, the LGA, told MailOnline that councils were ‘working hard’ to clear the backlog.
Uber will raise prices in London by 10 per cent for first time since 2017 and hike peak time airport fares by 25 per cent
By Emer Scully for MailOnline
Uber will raise its prices by 10 percent for the first time since 2017 to try to encourage drivers back onto the app.
The taxi company will push ‘peak time’ fares for airport trips up 25 percent, drivers were told on Wednesday evening.
It means Londoners face higher costs for even off-peak daytime journeys because the minimum fare in the capital will rise from £5 to £5.50, the Evening Standard reported.
And those travelling abroad via Heathrow or Gatwick will be hit by a heavy increase in transport costs, with a 15 percent rise at peak times on top of the 10 percent blanket rise.
Uber will push ‘peak time’ fares for airport trips up 25 percent, drivers were told on Wednesday evening (file image)
The base fare, which is currently £2.50, will be set to £2.75, and the per-minute and per-mile rates will rise by 10 percent.
The last time the taxi app raised its base pricing was 2017.
It comes after ‘thousands’ of drivers quit the ride-hailing app because of an absence of custom during the pandemic.
An Uber Spokesman said: ‘We’re making these changes to help provide a better rider experience, by signing up more drivers to meet the growing demand.
‘We know people rely on Uber to book a safe trip around London and this small fare increase will help reduce wait times. As always riders will get a fare estimate before booking their journey.’