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Uber and Bolt struggle to meet demand in the U.K.


In this photo illustration the Uber logo is displayed on a phone in front of Tower Bridge on November 25, 2019 in London, England.

Peter Summers | Getty Images

LONDON — Hailing a ride on apps like Uber and Bolt is now almost impossible at certain times of the day in parts of the U.K.

CNBC has heard multiple complaints from customers about the inability to find a driver on the Bolt app in recent weeks.

Some customers claimed that they have been charged outrageous prices due to “surge pricing,” which is activated when apps are busy. According to customers, the problem tends to happen late at night or on weekends.

It all boils down to supply-demand. This means that there is not enough drivers available to handle all requests. This has led to prices increasing.

Markus Villig is the co-founder of Bolt and its CEO. He said last week on CNBC’s Squawk Box Europe that customers have “recorded higher prices than ever.”

Villig (whose company is worth 4 billion euros, or $4.7 billion) said that after the lockdown, ride-hailing has seen a rebound stronger and quicker than anticipated.

“The supply side the in terms of drivers … just haven’t been able to catch up yet,” he said.

Uber faces the exact same issue. CNBC reported that Uber’s U.K. demand increased while the number of drivers (around 70,000) was still the same pre-pandemic.

Uber UK’s business has returned to prepandemic levels since May. In fact, many cities have seen their demand rise beyond pre-pandemic levels. In Birmingham demand is 22 percent higher, in Sheffield it’s 30% higher and in Nottingham it’s 40% more than in March 2020.

Uber spokesperson in the U.K. stated that they are encouraging up to 20,000 drivers to join their ranks to help meet riders demand.

Difficulties getting a ride

Robert Collings, head of finance at fintech start-up Flux, told CNBC that both Uber and Bolt had let him down in London recently.

People should be able hail a ride in minutes. But, recently, I have been dealing with long delays and cancellations. This has led me to start exploring other alternatives.

One example he shared was when he tried to find an Uber for a ride at one o’clock in the morning on a weekday. Multiple drivers accepted and then canceled the ride, he said, with the quoted price rising from £11 to £28 in the meantime. Bolt was then his choice, and he faced similar cancellation issues until a driver finally turned up.

Collings explained that while he only waited for 15-20 minutes before the driver arrived, the wait felt much longer when the goal was to be home by night.

Elsewhere, London-based Dave Thomson, chief product officer at video conferencing platform Whereby, told CNBC that he and his wife both now check Uber, Bolt and FreeNow to increase their chances of finding a ride.

“[We] “Open all three apps simultaneously and see who gets a cab the fastest,” Thomson said. It is becoming more difficult to leave the house without a lot of administration.

These issues don’t just affect the U.K.; customers from cities such as Melbourne, Warsaw, Paris and Warsaw are complaining too.

Drivers move into food delivery

It comes as many drivers stopped working for apps like Uber and Bolt during the pandemic, with some moving on to new jobs where they qualify for employee benefits such as sick pay and holiday pay, but less flexibility.

 CNBC spoke with Harry Campbell, a ride-hailing expert who said there was a “big shortage” of drivers. This is because the fall in ride-hailing during the pandemic coincided well with an increase in demand for food-delivery service.

They realized they could also transport food with their own cars.

Campbell stated that many ride-hail drivers switched to food delivery after the pandemic. They are paid comparable and don’t need to interact with people.

It’s not like a chicken korma or peperoni pizza that will make you mad at your driver for making a wrong turn. Nor will they vomit all over your car.

You deserve better pay

Bolt and Uber have now joined forces to help more drivers use their services.

In April, Uber said it would spend $250 million on a one-time stimulus aimed at getting drivers back on the road.

CNBC’s Dara Khosrowshahi, Uber CEO, said Tuesday that the company identified its need for more drivers early in their development. In the second quarter we really looked into the supply side, particularly in America, to rejuvenate our driver base, and increase our U.S. driver base. Now, that’s what we are seeing, is the return on that investment in Q3.

“I think we will see pricing ease up in the second half of the year, and volume accelerates,” he said.

CNBC’s Sam Raciti spoke on behalf of Bolt as its regional manager in Western Europe. “Bolt like many other organizations would love to sign more drivers,” he said.

CNBC’s Tassos Naulas is a data scientist that studies mobility in cities and said that ride-hailing will continue to evolve.

Noulas stated that he believes there will be competition for workers and drivers deserve better wages. What does this all mean for the financial viability of taxi hailing companies? They were always a big risk … the taxi driver might win the game in the end.”

Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.