I've been taking Uber pool a lot lately. Sometimes rides are as little as $4 and I go clear across town from SOMA all the way to the north end of the city. How can they possibly make money on rides this cheap? Lyft prices on the other hand are much higher, sometimes as much as 4x.
Ask HN: How can Uber drivers make money when pool rides are so cheap?
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Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#2It's Uber who loses money on those rides, not the drivers. They are trying to get you to use them, instead of the competition. If their strategy works then they can eventually start charging more because they'll be the only rideshare in town.
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#3I've seen many drivers complaining on Reddit as to how many trips are effectively a net loss once one includes things like wear & tear, much less opportunity cost.
Most drivers seem to loathe pool.
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#4It's Uber who loses money on those rides, not the drivers. They are trying to get you to use them, instead of the competition. If their strategy works then they can eventually start charging more because they'll be the only rideshare in town.
> It's Uber who loses money on those rides, not the drivers.
If you want to view it that way then it's both drivers and Uber that's losing money.
I do Lyft on the side over summer as a poor grad student. I only have 3 pool ride and those three the passenger didn't have to share any ride with anybody and I made less than if those ride were not pool.
You're also implying that in the long ride Uber will win if it works as if the speculative end will justify the mean.
Which, personally, I think a flaw and weird way of seeing it.
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#5Well isn't this multiplied by the number of people in the pool? What is the normal rate for such a ride? Is is four time cheaper than Lyft because they are taking four people?
Uber's gameplan is to dominate the app market so when self-driving cars are invented they can own every car on the road.
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#6[deleted]
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#7It's Uber who loses money on those rides, not the drivers. They are trying to get you to use them, instead of the competition. If their strategy works then they can eventually start charging more because they'll be the only rideshare in town.
> It's Uber who loses money on those rides, not the drivers. They are trying to get you to use them, instead of the competition.
Are there not laws against predatory pricing like this?
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#8Are you comparing to Lyft or Lyft Line?
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#9It's Uber who loses money on those rides, not the drivers. They are trying to get you to use them, instead of the competition. If their strategy works then they can eventually start charging more because they'll be the only rideshare in town.
> It's Uber who loses money on those rides, not the drivers. They are trying to get you to use them, instead of the competition. Are there not laws against predatory pricing like this?
IANAL and my expertise in this matter is only as deep as skimming these articles[1][2] but it seems like it would be illegal if Uber were a monopoly and cutting prices to prevent competition. Cutting prices to try to gain market share seems to be a competitive practice which benefits consumers.
1.https://www.ftc.gov/enforcement/anticompetitive-practices 2.https://www.ftc.gov/tips-advice/competition-guidance/guide-a...
Re: Ask HN: How can Uber drivers make money when pool rides are so cheap?
#10I've seen many drivers complaining on Reddit as to how many trips are effectively a net loss once one includes things like wear & tear, much less opportunity cost. Most drivers seem to loathe pool.
If you're using your own car, it's a losing proposition, unless you never drive in between rides, which is impossible because you have to drive unpaid to pick up the rider. Vehicle costs $0.61/mile to operate, ridesharing platforms pay $0.83-$0.88 per mile. So do the math, if you're driving more than 1/3 mile unpaid for every paid mile, there's a loss. Don't forget paying the vig to the Rideshare network of 20-35%.
I'm not factoring in the time component of the fare, because for average rides it is immaterial. In Los Angeles, Lyft pays $9/hr for regular Lyft and $6.60/hr for Lyft Line. Only when there's a rider in the car. So if you wait 3 minutes after drop off for the next request (like if it's busy and you aren't in an alligator pit of drivers competing for requests. You can also end up waiting an hour between rides if you're really unlucky or get taken outside of the hip zones where riders are plentiful), then take 3-10 minutes to arrive at the pick up, then give a typical ride of 5-6 minutes, your time payments are less than $5/hr. Possibly less than $1/hr.
The only way to eek out a slight profit is to rent a vehicle under a partnership and hit your ride quota to get the rental cost bonused back to you. At that point, your expense is fuel, and if you hypermile the right vehicle, the cost is about $.10/mile. Then on top of that, you need to win the lotto several times daily and get the vaunted long ride with a $12-$20 fare or $80-$90 if you hit the jackpot and you'll then be doing better than working in fast food. But don't forget there are plenty of unpaid miles. Getting back to your hot spots to increase ride count/decrease idle time, returning from the sticks after the jackpot ride, and driving home from the other side of the region when you're too tired to drive any more.