People misunderstand Uber's motives. They are not slimy.
Quite the opposite: they are a public good. The company is the front end for a giant charitable effort by venture capitalists. They are pouring money into uber, to help it drive down the costs of urban transportation, enabling people in cities to have more money available for necessities like rent, diapers, and food.
The Wheels Come Off Uber
31–40 of 105 posts
Re: The Wheels Come Off Uber
#32Earlier quoted context omitted.
If this is true if uber, that it has no path to profitability, isn't it also true of ubers competitors? A lot of Uber's costs to date have been proving that ride-sharing is a thing that consumers want to do (market education) and that governments don't want to stop (lobbying). Their competition get the benefit of that Uber's investment in those things for free, so it might be the case that Uber will fail and their co…
Forgive me if I am being slow but what is the actual difference between "ride sharing" and "unlicensed minicab"? I mean that seems to be the crux of all Uber's regulatory woes - that they are either unwilling or unable to articulate it.
The difference is ride sharing is when the driver was going to do the ride anyway, and the passengers are just sharing the ride, hence the name. It's historically been mildly popular, for instance, on weekends and other breaks with trips originating at and returning to college campuses.
Of course, none of the big “ride sharing companies” have anything to do with actual ride sharing.
Re: The Wheels Come Off Uber
#33By some measures Uber has been fabulously successful, coming from nowhere to the largest privately held company in seven years, and now a $70 billion g/publicly traded/private/ company. Uber has done a stunning job of disrupting a crony-capitalist, monopolistic system. If they are still searching for a way to make a profit, surely they'll figure it out before long. * updated to remove publicly traded
Uber isn't publically traded.
Yet. The goal clearly is to rush to an IPO.
Re: The Wheels Come Off Uber
#34Earlier quoted context omitted.
It's easy to disrupt a crony-capitalist, monopolistic system by selling your product at a loss, but you can't make a profit that way.
Uber loses money, but it doesn't sell rides at a loss. Up to 2015 at least (the date of the best finance leak I've seen), Uber's cut of fares was ~18%; and furthermore, that 18% cut more than covered Uber's costs of sales. Source: http://www.nakedcapitalism.com/2016/11/can-uber-ever-deliver... Uber actually makes money on each ride - it's just that the gross profit from those rides is short of covering its operating…
Maybe I don't understand the charts and the article you linked to but it says that:
"Uber passengers were paying only 41% of the actual cost of their trips; Uber was using these massive subsidies to undercut the fares and provide more capacity than the competitors who had to cover 100% of their costs out of passenger fares."
To me that sounds like selling rides at a loss.
Re: The Wheels Come Off Uber
#35It's a question if uber can race to self driving cars fast enough. That's really the only way their financial model can make sense. They should really be seeing this as essential to their survival, like nuclear bombs in WWII. Nazi Germany had maybe 1000 people working on their version. USA had 180,000(!). I suspect in this analogy, uber is not USA. Someone else will get this rolled out first. But I'm not 100% sure.
Self-driving is an engineering problem so I think a good guess is that a strong engineering company will get it to market first: Google. If that happens, wouldn't Google just start their own ride-sharing service, and drop it right into google maps so customers never even try uber?
Re: The Wheels Come Off Uber
#36Uber will live on.
Just talk to the drivers - you will get it.
Uber can continue churning their workforce for at least 15+ years as automation continues to whittle down the blue collar workforce.
Re: The Wheels Come Off Uber
#37It's a question if uber can race to self driving cars fast enough. That's really the only way their financial model can make sense. They should really be seeing this as essential to their survival, like nuclear bombs in WWII. Nazi Germany had maybe 1000 people working on their version. USA had 180,000(!). I suspect in this analogy, uber is not USA. Someone else will get this rolled out first. But I'm not 100% sure.
> It's a question if uber can race to self driving cars fast enough. I'm not sure that's true though; I don't get the oft-repeated logic that self-driving cars will save Uber. OK, they save on labor costs, but right one now of Uber's (slimy, IMO, but significant nonetheless) major savings is pushing vehicle maintenance and deprecation costs onto their drivers. They won't be able to do that with self-driving cars: the…
> Uber's (slimy, IMO, but significant nonetheless) major savings is pushing vehicle maintenance and deprecation costs onto their drivers.
This is fallacious. The end-user pays for vehicle maintenance and depreciation. There cannot be any savings by pushing around which party writes the cheque as the only source of income to pay that cheque can be the end-user.
Re: The Wheels Come Off Uber
#38Earlier quoted context omitted.
the article is frustratingly light on actual reasoning about why uber can't become profitable. the tl;dr is basically "it looks bad so they're going to fail". it does look very bad but that in itself (even with the various details mentioned) doesn't shine a light on the path that uber will take to failure. it only shows that any path they could take is treacherous. it's an opinion piece with a bunch of facts thrown a…
FYI, the OP links to a 10-part series of posts about Uber's economics by someone with decades of experience in the transportation industry. Here's a link to part one: http://www.nakedcapitalism.com/2016/11/can-uber-ever-deliver...
*ten-part
It's still going: http://www.nakedcapitalism.com/2017/06/can-uber-ever-deliver...
Re: The Wheels Come Off Uber
#39Earlier quoted context omitted.
Uber isn't publically traded.
Yet. The goal clearly is to rush to an IPO.
Eight months ago, I would have absolutely agreed. Heck, even a few months ago when Travis Kalanick started recruting a COO, I would have agreed that the company is trying to rush to a liquidity event. Today though, I think that rushing to an IPO would be completely irrational and end with Uber trading at a small fraction of their most recent private valuation.
Right now, there is a huge vacuum at the CEO/COO/CFO troika. That, combined with the sordid Waymo lawsuit, would give any institutional investor pause before buying a strong position. Consequently, I would argue that Uber needs some strong leadership at the top, and some sort of resolution on the Waymo lawsuit before they can consider going public.
I wouldn't be surprised if Uber was acquired, but I would be very surprised if Uber goes public in the next two years.
Re: The Wheels Come Off Uber
#40Earlier quoted context omitted.
FYI, the OP links to a 10-part series of posts about Uber's economics by someone with decades of experience in the transportation industry. Here's a link to part one: http://www.nakedcapitalism.com/2016/11/can-uber-ever-deliver...
*ten-part It's still going: http://www.nakedcapitalism.com/2017/06/can-uber-ever-deliver...
Thanks. I fixed it.