Uber admits 'wrong decision' in Sydney surge pricing

Uber has issued an apology after surge pricing saw some customers being quoted fares up to four times the usual price during a siege in Sydney.

As the city faced a major lock-down during a hostage event in the CBD, Uber's app notified customers that surge pricing was in place, quoting prices up to "4x the normal fare". Uber later announced that those charged with surge funding would be refunded, and then confirmed that all trips out of the city would be free.

The company has since taken to its blog saying it made the "wrong decision" in allowing surge pricing to remain in place.

"Our priority was to help get as many people out of the CBD safely in the midst of a fast-moving event," said the statement, which was signed off by Uber Sydney General Manager David Rohrsheim. "The decisions we made were based only on helping to achieve this but we communicated this poorly, leading to a lot of misunderstanding about our motivations."

The company explained that its surge pricing is based on an algorithm that "kicks in automatically" when demand for Uber cars outstrips supply in order to encourage more drivers to the area of high demand -- a situation that occurred in Sydney's CBD during the siege.

We didn't stop surge pricing immediately. This was the wrong decision. We quickly reversed course and provided free rides to people needing to leave the CBD. In the end, no rider was charged to leave the CBD on Monday and all higher fares resulting from surge pricing earlier in the day were fully refunded.

It's unfortunate that the perception is that Uber did something against the interests of the public. We certainly did not intend to.

Uber Sydney said the company had listened to feedback and was "working to standardise a global policy" to ensure it could be efficient and "helpful" in the future.