Comment by salawat

>The primary purpose of surge pricing isn't to maximize profit, it's to increase supply.

Your thinking is overly rigid here. An action can be multiple things at the same time. Uber's incentive is to maximize transactions per unit time window. You are correct in that surge pricing on a first level pass isn't about profit maximization. You have to go up a layer of a straction or two before that becomes the case. Uber has to increase supply to fulfill transactions for a signalled demand, signalled demand is high, thus signaling more profit to be made, therefore the surge while at first seeming like a negative signal to consumers, is still acting systemically as a mechanism to bring about profit maximization.

Hiding this type of thing from the end consumer, or not saying it out loud, is a favorite of the current batch of business people.