Why Uber & Lyft Prices Are Set to Surge This Holiday Season

Driver shortage plus an increased demand equals a greater burden on your wallet.

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As if the holiday season weren't expensive enoughwe've got gifts to buy, flights home to book, and sanity-saving wine bottles to purchase—your bank account is about to take a bigger hit. Already soaring Uber & Lyft prices are set to surge even higher as the holidays approach.

Rideshare prices have remained on the rise for much of the pandemic, with circumstances only getting worse in recent months thanks to a driver shortage. In fact, according to Uber CEO Dara Khosrowshahi, who discussed the topic during the November 4 earnings call, prices were up 20% year-over-year in November. With travel demand continuing to skyrocket throughout the holidays, things are about to get worse. 

"This has been, to some extent, a giant pricing experiment that no one wanted to get into," Khosrowshahi told investors in the call.

Investment banking analyst Mark Mahaney told USA Today there is "no question" prices will spike this month and that riders should prepare for the increase, reaching double what pre-pandemic rates were—in addition to longer wait times and cancellations.

"It might even get worse over the holiday season as the travel demand explodes," CEO of Travel Search Engine RideGuru Ippei Takahashi chimed in. "It's not uncommon to see 2x, 3x or 4x prices. ... We're talking about a ride that usually costs $50 costing $200. So those definitely hit consumers' pockets directly." 

The good news? Lyft has seen "material improvement" in driver supply, which should lessen the price burden in the coming months. 

"I think the marketplace will rebalance itself," Mahaney added. "[But] that level of elevation will continue to moderate as we go over the next three to six months."

Translation: You've still got a pricey few months ahead if you rely on rideshare services.

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Megan Schaltegger is a staff writer at Thrillist.