Uber has done nearly everything right. I think its main vulnerability is that its laborers are a fickle bunch and Uber hasn't done enough to inspire any loyalty. All Uber drivers I talk to alternate between Uber and Lyft and exploit any promotions or incentives either firm offers.
Uber has the opportunity to revolutionize not just logistics but also on-demand employment, but has lagged in the latter, leaving the door wide open for Lyft and other services that carve out a big niche of Uber's market.
I think Uber should immediately offer the following services to its drivers:
- Tax planning, withholding even if it's 1099 income or if the driver has other sources of income.
- Matching IRA contributions with one year vesting.
- healthcare subsidy
- continuing education, or some way to level up in life by driving with Uber.
- Some incentive for being a loyal, exceptional driver.
- Car financing/leasing/sharing and insurance packages tailored at would-be Uber drivers who don't own a vehicle.
I know that more and more of these sorts of ideas are being tried by both Uber and Lyft, but investors need to realize that the workforce is being trained to be opportunistic and disloyal.
Many of the drivers I've interviewed (during my ride) despise Uber the corporation or boast about their fair weather support. Many reflect back on how Uber used to be better for drivers, etc.
Uber's main battles have been fought with regulators and with Lyft, but now the best strategy is figuring out how to become the Uber of on-demand employment.