Uber and Lyft have been using black-box, AI-driven pricing tactics to sell virtually identical rides at vastly different price points – and even offer fake discounts to entice customers, a stunning new investigation revealed.
In tests conducted for select routes across 17 states in March and April 2026, the median price difference between the lowest and highest fares for rides ordered at nearly the exact same time was a whopping 50%, according to a Consumer Reports investigation published Tuesday.
The two most popular ride-hailing apps in the US also frequently woo customers with promotions – but nearly 11% of all discounts on Uber and Lyft appear to be fake, because they’re based on falsely inflated prices, according to the nonprofit research and advocacy group.
The rise of dynamic pricing – when companies adjust prices in real time to reflect supply and demand – has outraged consumers at least since last year’s publication of a bombshell Consumer Reports study on Instacart.
The company faced such heated backlash that it eventually reversed its dynamic-pricing model, which was nickel-and-diming shoppers by charging different prices to different customers on the same grocery items in the same supermarkets based on demand.
Consumer Reports said Tuesday that it appears Uber and Lyft’s methods go beyond dynamic pricing, “because volunteers booked identical rides within a few minutes of one another and, in many cases, within the same minute.”
Volunteers remotely placed orders for the same rides, setting identical starting locations and destinations at around the same time. Some of the tests were also placed by volunteers who waited in-person for the rides.
Uber argued that it is impossible to ensure that volunteers placed their orders at the exact same time, since price changes take place “nearly every second.”
Lyft said that prices might have been artificially inflated during experiments by having so many volunteers place orders at the same time.
Both companies denied using fake discounts, also known as fictitious pricing.
In New York City, a 30-minute Uber ride from Manhattan’s Chinatown to Long Island City ordered at the same time showed three customers’ fares as less than $40; seven others’ prices as between $40 and $47; 17 shoppers’ fares ranged from $47.94 to $47.96; and two more prices came to $49 and $50.
Price variations were at times especially painful in the Big Apple – with one NYC route generating a price spread of 152%, far above the 50% median, the report said.
“People expect prices to change when demand spikes,” Consumer Reports CEO Phil Radford said. “What they don’t expect is for two customers taking the same ride at the same time to be charged very different amounts, or to be shown discounts that may not be discounts at all.”
“The solution is straightforward: Companies should be required to clearly explain how prices are set and ensure that advertised discounts are genuine, so people can comparison shop and know they’re being treated fairly.”
Both companies have said they do not use personal information to set prices – except for promotions and discounts.
A volunteer named Tessa saw an UberX ride priced at $65.95, with a higher price of $82.08 crossed out and a banner that read, “Fares lower than usual.”
But when Chuck, another volunteer, opened his app and looked at the same route, he saw a $65.95 fare – with no discount.
Forty other riders saw non-discounted prices ranging from $65.93 to $65.99 – meaning $65.95 was actually the normal starting price, and the discount was fake, according to the report.
An Uber spokesperson pushed back on that characterization, saying crossed-out prices with phrases like “Fares lower than usual” aren’t actual discounts, but are merely pointing out “historical comparisons.”
Nearly all of the investigation’s 175 volunteers “were concerned about their personal data being used for discounts,” said Derek Kravitz, the lead investigator on the report.
“They want to know why, they want to know when it’s happening, they want to know the factors that go into it, and they want to know what to do about it – and they don’t have any of that information at their disposal,” Kravitz told The Post.
Since pivoting to algorithmic pricing around 2016, both apps have seen their profits explode – while cutting back on the share of fares that go to drivers, according to the investigation.
In September 2022, Uber started increasing passenger prices and lowering driver pay, according to Consumer Reports. By the end of 2024, it was taking 42% of ride fares for itself – up from 32% just two years prior.
From 2019 to 2025, Uber’s profits nearly quadrupled – hitting $7.9 billion, up from almost $2.1 billion, according to the company’s annual reports.
Lyft similarly went from a loss of $679 million in 2019 to a profit of nearly $529 million in 2025.
“A lot of companies have figured out, well, base pricing – we don’t want to personalize that too much,” Kravitz told The Post.
“We don’t want to run afoul of consumer protection laws … so we’re going to personalize promotions and discounts … and the net effect is that people are paying more for rides than they were just a few years ago.”
According to Uber and Lyft, rider demand, supply of available drivers, location, time, estimated trip time and distance, weather, promotional offers and traffic patterns all play a part in prices.
But it appears it wouldn’t be too difficult for the companies to get their hands on demographic information, according to the investigation.
Uber patents show the company can determine that someone who frequently requests an Uber to a day care center before heading to a workplace or university is likely a single working parent, for example, as well as the rough ages of their children, the investigation said.
