Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Can Uber ever make money?

economist.com

Post reply on HN
Print view View original

41–50 of 430 posts

Re: Can Uber ever make money?

#41

Post by amelius »

tjpaudio wrote: post #34

I'm not quite sure everyone discussing this, including the economist article author, is in the loop with why Lyft and Uber are getting valued the way they are. Wall Street is not paying for a taxi company, they are betting that Uber and Lyft are the best poised to first rollout driverless ride sharing, i.e. one of them will own and monopolize patentable tech that the mass public wants to use. The existing experience…

Patents are not valid indefinitely. Given the ridiculous amounts of money thrown at this, patents will probably expire long before the break-even point is met.

Besides patents, Uber has no way to bind customers. Yes, it's a commodity business, and I see no way around it. Users can simply use a different and cheaper car, which will inevitably exist and become popular.

Re: Can Uber ever make money?

#42

Post by tw1010 »

Theoretically, couldn't they just fire almost all non-maintenance engineers and continue running the app without building new features? Wouldn't that make them profitable instantly?

Re: Can Uber ever make money?

#43

Post by ghaff »

tjohns wrote: post #30
ghaff wrote: post #23

Earlier quoted context omitted.

The same thing that largely keeps them from operating dealers (yes, now there are laws and contracts, but it was the manufacturers who wanted dealers in the first place) and rental car companies. Although there are legal impediments, companies often want to focus on a specific part of the value chain rather than having to own the whole thing.

Silvercar was recently acquired by Audi, so that's an example of a auto manufacturer running an car rental business.

That's why I said largely. I think one or more of the US manufacturers may have investments in rental car companies as well. But I'll still argue the basic point; companies often don't want to own the whole chain. (Auto manufacturers also use a lot of upstream suppliers as well rather than designing and building many of their components.)

Re: Can Uber ever make money?

#44

Post by rand0mthought »

perfmode wrote: post #35
tjpaudio wrote: post #34

I'm not quite sure everyone discussing this, including the economist article author, is in the loop with why Lyft and Uber are getting valued the way they are. Wall Street is not paying for a taxi company, they are betting that Uber and Lyft are the best poised to first rollout driverless ride sharing, i.e. one of them will own and monopolize patentable tech that the mass public wants to use. The existing experience…

Driverless ride sharing isn’t coming, in a meaningful way*, in the next ten years, I’m willing to bet my house on that. Meaningful such that it actually delivers monetarily

Do you plan to short UBER on amount of your house cost?

Re: Can Uber ever make money?

#45

Post by idlewords »

dcolkitt wrote: post #32
govg wrote: post #17

I can only see them making money in three ways : - They scale up massively and capture a huge fraction of the ride sharing market, thus allowing them to offer low cost / low margin rides, but making up for it by volumes : At least in India, they are in a good position, but they seem to have conceded the other markets with high potential for growth like SE Asia and China. - They have a premium offering that is actuall…

Option 4: Uber uses the expertise, infrastructure, and brand it built in ridesharing to expand into the becoming the de facto standard for timely last mile delivery. This is why UberEats is such a major strategic focus for the company. It's proof of concept that they can do more than be a taxi. An efficient platform for quickly and cheaply ferrying around stuff around town is a way bigger market than ridesharing. We'…

Saying that we're going to work to dominate a low-margin sector at a staggering loss for years, so that we can enter an even lower-margin established industry and recoup our losses there, is a gutsy proposition.

Re: Can Uber ever make money?

#46

Post by tjpaudio »

empath75 wrote: post #36
tjpaudio wrote: post #34

I'm not quite sure everyone discussing this, including the economist article author, is in the loop with why Lyft and Uber are getting valued the way they are. Wall Street is not paying for a taxi company, they are betting that Uber and Lyft are the best poised to first rollout driverless ride sharing, i.e. one of them will own and monopolize patentable tech that the mass public wants to use. The existing experience…

If it’s about driverless ride sharing why don’t you buy stock in a company like google that makes money and is developing driverless cars, instead of a taxi company that loses money. Google could build everything Uber has in a weekend once Waymo gets driverless cars working.

Because Uber and Lyft are pure plays.

Re: Can Uber ever make money?

#47

Post by _Microft »

prolepunk wrote: post #18
skywhopper wrote: post #15

There is literally no way for a mass-market taxi service to make money unless they have a monopoly, or some unexpected disruptive technology comes along that gives one company an unassailable advantage in lowering costs. The Uber app was the original innovation, but it's not particularly innovative anymore. Besides Lyft, traditional taxi companies have similar apps in some markets. Skirting regulation and good labor…

If self-driving technology is mature enough to be used and there are several implementations to choose from, what stops care manufacturers to go after that market directly and undercutting everyone else? * They have industrial facilities to build cars * They have dealership networks to repair cars * They have capital or can borrow easily to do it I can even argue that all that stops car manufacturers from operating t…

That's Tesla's plan and the reason why they want to forbid to use their full self-driving system for providing rides to third party taxi services.

Re: Can Uber ever make money?

#48

Post by jandrese »

wintorez wrote: post #3

Uber is not making money? How? Why?

They're blowing a ton of money on R&D for autonomous cars. Also they are spending a fortune on lawyers to fight every municipal cab company in the world. Also, their business model is undercutting the existing competition, which makes big profits hard to come by.

Re: Can Uber ever make money?

#49

Post by bduerst »

dcolkitt wrote: post #32
govg wrote: post #17

I can only see them making money in three ways : - They scale up massively and capture a huge fraction of the ride sharing market, thus allowing them to offer low cost / low margin rides, but making up for it by volumes : At least in India, they are in a good position, but they seem to have conceded the other markets with high potential for growth like SE Asia and China. - They have a premium offering that is actuall…

Option 4: Uber uses the expertise, infrastructure, and brand it built in ridesharing to expand into the becoming the de facto standard for timely last mile delivery. This is why UberEats is such a major strategic focus for the company. It's proof of concept that they can do more than be a taxi. An efficient platform for quickly and cheaply ferrying around stuff around town is a way bigger market than ridesharing. We'…

Expanding on this Option 4: They become an auction platform for last mile deliveries.

- Demand comes from third party apps through API, or SMBs that are looking to make a same-day delivery. Higher delivery bids means network is more likely to fulfill sooner.

- Uber fulfills supply with their own network of drivers but also allows other regional rideshare networks to plug in.

- Reputation is keyed to driver's license, and better reputation means preferred bids and/or a better cut of the delivery fee, scaling at a ratio to cover the risk of bad/unknown drivers.

- Self driving cars become a reality, and the network allows autonomous delivery swarms to plug in and fulfill supply.

Re: Can Uber ever make money?

#50

Post by gwbas1c »

tjpaudio wrote: post #34

I'm not quite sure everyone discussing this, including the economist article author, is in the loop with why Lyft and Uber are getting valued the way they are. Wall Street is not paying for a taxi company, they are betting that Uber and Lyft are the best poised to first rollout driverless ride sharing, i.e. one of them will own and monopolize patentable tech that the mass public wants to use. The existing experience…

That's like investing in Yahoo in the .com bubble. Uber and Lyft's only asset is the interface between the customer and the driver, not self-driving cars.

It's very easy for someone to come up with an app to order a robotic taxi. This is probably the easiest part of the robotic taxi business.

It's so much so, that unless Uber or Lyft's service is essentially "free," a robotic taxi business will probably consider the cost of working with Uber or Lyft not really worth it and bypass them. They might also prefer the experience of users sticking with their own app in their own walled garden. The robotic taxis will probably have large stickers in them that say something like, "order your next car through us and $AVE!!!" (Just like how JetBlue encourages customers to use jetblue.com)

Or, to be quite honest: If I can actually hail a robotic Tesla taxi next year, I'd rather use Tesla's app instead of Lyft or Uber's app.

Post reply on HN