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If Lyft can't keep its drivers as contractors, it may never be profitable

latimes.com

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Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#111

Post by Spooky23 »

chrisseaton wrote: post #19
newprint wrote: post #7

I'm kind of torn on this. My father has been truck driver his entire life and for the last 20 years worked as a contractor, while driving his own truck and trailer, since it gives him more $$$ than average driver who works as employee. However, he has non-existent social net. No health insurance, no pension benefits. If he out of work or has serious health issues that ground him for months, he has to dig into savings…

If he's earning more than average, and professional truck drivers are pretty well paid, then can't be purchase that social net himself? He can buy health insurance, pension, group income protection, everything you mentioned. I know poor people can't do that, and that's the issue, but why can't a well-paid truck driver do it?

Earning = get more cash. From a total compensation perspective, you’re better off with a larger operator.

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#112

Post by FakeComments »

threatofrain wrote: post #96
gotocake wrote: post #33

Earlier quoted context omitted.

Human drivers are just mechanical turks to build market share while self-driving cars become commercially viable. Don’t they have to exist before we worry about commercial viability? You’re not the only one talking like FSDV’s are just minutes away, when the truth is that when you cut through the hype and wishful thinking, they’re an indeterminate period of time away. The conversation around this subject reads like p…

Aren't a few of the big players already piloting consumer-accessible taxi programs? IMO, the stuff which has already been demonstrated is a bit too creepily good for comfort, even if we're talking about limited Tesla autopilot.

Sure, but we’re still easily 5 years from “all traffic, all weather, all situations” car AI, which is necessary for fully autonomous vehicles.

They already have the cheapest solution for having a driver and a car go around town, so sending drivers with their “autonomous” cars in good conditions is an impressive step, but insufficient for full autonomy and not enough to fix their business problems — they need to be able to send the cars in real life situations with no driver.

So 5 years of technology and 5 years of regulation before widespread adoption is a long time for Uber to have to be spending investor money before they spend investor money on autonomous car fleets in every major city. (Or are they going to lease cars from other people? — it may be then that the cost of leasing vehicles from others never comes low enough.)

The better hope for their investors seems to be the rumor they’re profitable in large, established cities and their costs are expansions and turf wars.

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#113

Post by dexen »

aaomidi wrote: post #107
dexen wrote: post #105

Earlier quoted context omitted.

>There has been a driver shortage for 10+ years How does that square with the low net compensation of the drivers? Is there perhaps a secondary mechanism, other than the (asserted) labor supply shortage, that depresses the wages?

This is actually one of the cases where supply side economics breaks down. People refuse to pay more for this and if you've invested so much for truck, car insurance, etc...

I am sorry, this doesn't make any sense to me. If "people refuse to pay more for this", it means there's either over-supply of service at the current price-point, or there are easily accessible, low-cost alternative services. There is no third way, barring country-wide air-tight collusion of all transportation buyers, which is an unrealistic scenario.

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#114

Post by AlexTWithBeard »

scarface74 wrote: post #69
AlexTWithBeard wrote: post #44

Earlier quoted context omitted.

A universal health insurance may be unfair, non-american, going against a free market ideology and endorsing nanny state. But it would relieve so many problems, from homelesness to our overly litigious society, that I'd vote for it with both hands.

So why do we feel that it is “Unamerican” to not let people die on the street because they can’t afford health insurance? I thought we were suppose to be a “great moral Christian nation”? There is nothing about the American health care system that has anything to do with the free market. Before the ACA, if you had any type of pre-existing condition, you could not buy health insurance at any price.

Very rarely religion shapes the moral, rather than just encloses and protects the existing state of things.

I guess the roots of this "American" morale is those times when you arrive to the New World, you disembark the ship, and nobody owes you anything. You don't owe anyone anything either. If you don't like it, don't board the ship.

The times have changed. The morale, as it often happens, lags behind.

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#115

Post by thisacctforreal »

m463 wrote: post #34
Axsuul wrote: post #9

Isn't this just typical legalese that IPO docs are required to say on caveat emptor? It's typically worst case.

This might be like warning labels on the side of ladders. Somebody somewhere did something stupid with a ladder, and then a warning label is added to every ladder to prevent a future lawsuit. and of course, mentioning things like this then becomes "news", spawning articles like this: https://www.tesla.com/blog/misfortune

That was a shitty response to someone dying in their vehicle.

Tesla's autopilot marketing is extremely poor.

https://tesla.com/autopilot

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#116

Post by baby »

TomMarius wrote: post #99
baby wrote: post #67

Earlier quoted context omitted.

That’s why some stuff like health care should not be privatized. Because the market will always go against it.

That is absolutely not true. You're generalising too much. There are many people that are trying to democratise healthcare the private way.

Look at how it's doing

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#117

Post by nradov »

FakeComments wrote: post #110
nradov wrote: post #14

Earlier quoted context omitted.

Another alternative would be to decouple health insurance and retirement plans from employment.

Are retirement plans coupled to employment? Neither social security nor 401Ks are, in that you can often keep and almost always rollover (to a personal) 401K when departing. Pensions were, but as I understand it, those basically don’t exist anymore.

You can't really contribute to a 401(k) plan unless your employer sponsors one. When you leave the job you can roll it over to an IRA. Some independent contractors can contribute to an IRA, but it's inferior because the annual contribution limit is only $6000, and the income limits are lower. And of course employer matching contributions aren't available to independent contractors.

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#118

Post by anoncoward111 »

chrisseaton wrote: post #19
newprint wrote: post #7

I'm kind of torn on this. My father has been truck driver his entire life and for the last 20 years worked as a contractor, while driving his own truck and trailer, since it gives him more $$$ than average driver who works as employee. However, he has non-existent social net. No health insurance, no pension benefits. If he out of work or has serious health issues that ground him for months, he has to dig into savings…

If he's earning more than average, and professional truck drivers are pretty well paid, then can't be purchase that social net himself? He can buy health insurance, pension, group income protection, everything you mentioned. I know poor people can't do that, and that's the issue, but why can't a well-paid truck driver do it?

A well-paid truck driver can't do it because in many states, such as NY, a comparable health insurance plan is about $800 a month [1], and that's before you even see the doc or pay deductible.

[1] I have a broker's license I don't use anymore

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#119

Post by zazen »

aaomidi wrote: post #109
zazen wrote: post #108

Earlier quoted context omitted.

To me, the question still stands: if people refuse to pay more for the service, then in what sense is there a shortage of the service? Can you expand on what you mean by "supply side economics breaking down"?

A lot of trucks are owner operated. They can't afford to not work - even though they know they will be able to potentially make more money. Owning a truck is a lot of maintenance - insurance, parking costs, etc. A lot of owners also have to pay lease, loans, etc. They can't afford to negotiate for better rates. Just because there isn't a lot of supply doesn't mean that rates go up!

I can see that small businesses aren't in a great position to negotiate with large businesses. But if there were really a substantial shortage, you wouldn't have to engage in high-risk, high-stakes negotiation to get a better rate. People will offer you a higher rate to secure your service, if your service is _really_ in short supply.

If the people hiring these independent trucks can afford not to pay more, because they know someone else will take the lower rate, then there isn't a shortage. This could just about be the definition of whether or not there is a "shortage".

Re: If Lyft can't keep its drivers as contractors, it may never be profitable

#120

Post by JetSpiegel »

denormalfloat wrote: post #87
zbentley wrote: post #32

Earlier quoted context omitted.

> How much help did he earn? How much does he deserve? The money a driver gets paid is the help. That seems naïve and inhumane. Compensation and benefits are understood to be separate things in the US at this time. From social security to health insurance, the costs of securing such things without an employer (an entity on the other side of the wealth gap, usually) are often untenable. > Forcing Lyft to hire employee…

How could that be inhumane? The worker and the payer agree ahead of time how much is to be paid and what goods and services are delivered. Both parties have to agree, or else one will walk away. You say it's inhumane because one party didn't get something (healthcare) from the other? How is that fair to the other person? I'm asking if the deal was agreed to by consenting parties, nothing more.

The worker has a Sophie's choice to make: earn some money being exploited or starve.

Consent implies both parties are peers.

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