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Uber is expanding its premium service in Philly

The company says customer fares and driver pay will be consistent between UberBlack and the new Premium.

Uber and Lyft drivers pick up arriving passengers outside the baggage claim at Philadelphia International Airport.
Uber and Lyft drivers pick up arriving passengers outside the baggage claim at Philadelphia International Airport.Read moreJOSE F. MORENO / Staff Photographer

Uber is sending emails to hundreds of its Philadelphia drivers Friday with news: UberBlack, the luxury ride option, will fade away and be replaced by UberPremium, which the company says will offer more drivers a chance for bigger earnings.

About 2% of the working Uber drivers in the city who pick up passengers for the most commonly requested service, UberX, will become eligible to provide premium rides beginning in March, the company said. Those trips cost more and have the potential for higher driver pay.

“The changes will allow existing premium drivers to save hundreds of dollars on insurance while finally giving more drivers access to higher fares across the city,” Uber spokesperson Harry Hartfield said in a statement.

UberBlack cars and SUVs have been regulated as limousines, required to display commercial plates and have commercial vehicle insurance, which can cost drivers as much as $380 a month, the company said. State law delegated oversight of ridesharing services operating in the city to the Philadelphia Parking Authority, which also regulates traditional taxicabs and private car services.

Drivers of UberX and other service options use their personal vehicles and own insurance.

Both UberBlack and SUV use newer and posher vehicles, as will the new UberPremium. Fares for the new service will be about the same, the company said.

» READ MORE: Uber and Lyft riders are coming back faster than drivers, causing price spikes

As cities around the U.S. loosened pandemic restrictions in recent months, demand for ridesharing services rose, but a driver shortage caused higher prices and longer wait times for customers in many areas.

“We wanted to share some exciting news,” the email from Uber to select UberX drivers reads. It describes the shift to the Premier brand for the platform’s luxury option and says, “Given the make and model of your current vehicle, we believe you will be eligible to accept trips through this ride option” without changes to the drivers’ license or insurance.

The email to existing UberBlack and Uber SUV drivers notes there will be “no immediate impact” on them. It referred the drivers to a list of FAQs. “We know these are big changes, and we plan to work closely with you ... to ensure the transition is as smooth as possible.”

In the first three months of this year, Uber and Lyft reported 5.7 million trips in the city to PPA, an increase of 11.5% from the final quarter of 2020. But the number of trips was still down 44% since the start of the pandemic, according to authority data.

» READ MORE: ‘Working harder and getting less’: Good old days of ride-sharing are gone, Philly drivers say

The lowest level of activity came from April through June last year when there were about 3 million ridesharing trips in Philadelphia, the PPA says. Ridesharing companies are required to report their trip volume to the authority every quarter.

The Pennsylvania law that authorized ridesharing companies to operate in the state requires them to pay 1.4% of their gross revenue from Philadelphia operations. Two-thirds of that fee goes to the School District and one-third to PPA. Overall, revenue from the fee has dropped 29% from the start of the pandemic.

Ridesharing generated $985,586 for city schools in the first three months of 2021, the authority said.