Starting next week, on October 10, Uber will subsidize rides for residents living in Summit, New Jersey, from the local train station to their homes. This move, the result of a partnership with the town trying to deal with a parking problem, is just another way the company is attempting to expand into the suburbs.
Summit, a small suburban town less than an hour’s train ride outside of New York City, has had problems with train station parking in the past. There are simply too many commuters for the cramped parking lot to accommodate. And since the station is located smack in the heart of quaint downtown Summit, building a new parking structure is impossible. Uber, it seems, is the answer.
The idea started last year, when Summit’s city administrator, Michael Rogers, contacted Uber and pitched the idea of subsidized rides, reports BuzzFeed. Instead of having commuters hunting and paying for a parking spot in the morning, they could pay $2 each way and be driven to and from the station every day. It would cost about the same as a parking pass at the station. This would both reduce the demand for parking spots and increase the demand for Uber cars.
The six-month experiment, which begins on Monday, will be for about 100 Summit commuters. Here’s how it will work:
Residents will have to opt into the Uber pilot program, and the ride-hail company will denote their accounts for the promotion. Residents who have already purchased $4-per-day parking permits will be able to take Uber to the train station for free. Those without prepaid parking permits will pay $2 each way. Summit will reimburse Uber for the difference between the flat fares and the true cost of a ride, which drivers will receive up front.
Rogers told BuzzFeed News that he expects the deal will cost Summit only about $167,000 annually, a far cry from the likely $10 million it would cost to build a parking lot.
This is an extremely strategic move on Uber’s part. Not only does it get more Uber cars into a suburban neighborhood, it also helps to raise awareness for ridesharing and ride-hailing. It’s easy to Uber or Lyft to places if you’re living in the city, but such options are scarce in most suburbs.
Additionally, if this program takes off, it could potentially spread to other towns within the area. The Uber takeover is happening.