Virgilio Lorenzo Jr

LTFRB lowers cap on surge pricing for ride-hailing services amid holiday rush

An Uber driver in transit in Quezon City on Thursday. The Senate is set to hear the conflict between the LTFRB and TNV services, Uber and Grab. Mark Demayo, ABS-CBN News

Article (news)

Arthur Fuentes

ABS-CBN News

<p>MANILA — The Land Transportation Franchising and Regulatory Board is lowering the cap on surge pricing for ride-hailing services, or transport network vehicle services (TNVS).</p><p>The agency said this was in response to commuter complaints regarding excessive fares caused by algorithmic pricing during high-demand periods.</p><p>According to the LTFRB memo released on Friday, the surge price that can be charged by a Transport Network Company like Grab, cannot be higher than the sum of the Travel Distance Charge and the Travel Time Charge.</p><p>The memo gave a sample computation for the fare:</p><p style="line-height:1"><strong>Flagdown:</strong> P45.00</p><p style="line-height:1"><strong>Distance Charge (5km):</strong> P75.00</p><p style="line-height:1"><strong>Time Charge (10min):</strong> P20.00</p><p style="line-height:1"><strong>Max Surge Allowed:</strong> P95.00 (75 + 20)</p><p style="line-height:1"><strong><u>Total Fare:</u></strong> P235.00</p><p>Flagdown rates, as well as per-kilometer and per-minute rates, differ between hatchbacks, sedans, AUVs, SUVs, and premium vehicles.</p><table style="width:100%"><tbody><tr><td style="width:25.4158%"><div style="text-align:center"><strong>Vehicle Type</strong></div></td><td style="width:19.4456%"><div style="text-align:center"><strong>Flagdown</strong></div></td><td style="width:17.7399%"><div style="text-align:center"><strong>Per Kilometer (B)</strong></div></td><td style="width:17.2281%"><div style="text-align:center"><strong>Per Minute (C)</strong></div></td><td style="width:20.0000%"><div style="text-align:center"><strong>Surge Price</strong></div></td></tr><tr><td style="width:25.4158%">Hatchback/Subcompact</td><td style="width:19.4456%">P35.00</td><td style="width:17.7399%">P13.00</td><td style="width:17.2281%">P2.00</td><td rowspan="4" style="width:19.94%">Not more than B + C</td></tr><tr><td style="width:25.4158%">Car Sedan</td><td style="width:19.4456%">P45.00</td><td style="width:17.7399%">P15.00</td><td style="width:17.2281%">P2.00</td></tr><tr><td style="width:25.4158%">AUV/SUV</td><td style="width:19.4456%">P55.00</td><td style="width:17.7399%">P18.00</td><td style="width:17.2281%">P2.00</td></tr><tr><td style="width:25.4158%">Premium</td><td style="width:19.4456%">P145.00</td><td style="width:17.7399%">P36.00</td><td style="width:17.2281%">P4.00</td></tr></tbody></table><div> </div><p>This new cap on surge pricing will be in effect from December 17, 2025, until January 4, 2026, the LTFRB said. </p><p>&quot;After this period, surge pricing will return to its original rate unless the Board finishes its study on the matter,&quot; the LTFRB memorandum read.</p><p>TNCs are also directed to refrain from collecting any share, commission, or service fee derived specifically from the surge price component.</p><p>Apps must also clearly show the fare breakdown (Flag-down, Per-km, Per-min, and Surge Multiplier) to the passenger.</p><p>The LTFRB directed TNCs to submit a report by December 17, detailing their algorithm changes and providing user interface samples. TNCs that fail to comply or attempt to circumvent the cap through hidden fees may face suspension or cancellation of their accreditation.</p><p>The Board cited that while surge pricing was intended to balance supply and demand, current patterns suggest an over-reliance on it, undermining affordability. The LTFRB said the ceiling on surge pricing is intended to protect the riding public during the high-demand holiday season.</p><p>The agency earlier also issued a memo that penalizes the cancellation of bookings initiated by drivers of ride-hailing vehicles.</p><p>- With a report from Izzy Lee, ABS-CBN News</p>

<p>The agency said this was in response to commuter complaints regarding excessive fares caused by algorithmic pricing during high-demand periods.</p>

The agency said this was in response to commuter complaints regarding excessive fares caused by algorithmic pricing during high-demand periods.