Income of an uber driver • Hacker News Board

Re: Income of an uber driver

#11

Post by prostoalex » Sat, Jul 18, 2015, 6:04 PM UTC

hkmix wrote: post #3

The costs include TWO new cars and a ton of other miscellaneous fees. I'm sure that the point being made is valid to some extent, but the calculations are way out of proportion.

He's putting 95k miles a year on the vehicle with his assumption (which tends to be conservative for the transportation industry, a car service guy mentioned to me once his black cars tend to accrue 150k/200k miles a year, since "you don't make much money by keeping it parked").

There aren't a lot of vehicles which you can buy used, put 95k miles a year, and end up with reliable vehicle 12 months later. You basically trade up initial investment cost vs subsequent maintenance cost.

Also, if he has good credit, I could see how automakers' aggressive 0% financing could result in a lower monthly payment for a new car than a used vehicle (since no one will finance a used car at 0%).

Re: Income of an uber driver

#12

Post by jakejake » Sat, Jul 18, 2015, 6:05 PM UTC

xname wrote: post #2

This is easy. If Uber driver does not make money, there will be less Uber drivers, so the fee will come up. There's nothing need to be complainted about.

In my experience the result seems to be more crappy cars and less "hip" drivers, if that's worth anything. I read the original plan the founder wanted was an instant "classy" ride. When I choose uberx I don't really expect it to be classy anymore, which is fine most of the time. But it has been something I've noticed. I wouldn't expect a driver to make nothing just to have a new car to drive for uber.

Re: Income of an uber driver

#13

Post by frenchies » Sat, Jul 18, 2015, 6:07 PM UTC

I always thought the concept of asset and time sharing was to convert what you already had into extra cash, just to offset the full price and maintenance of what you already had if you found yourself needing a few hours of income during some spontaneous downtime.

I dont know the feasibility of, for example, keeping pace with a median income earner, or even a minimum wage earner, because honestly I've never done a real estimation of the business.

At first glance, with car payments, gasoline, oil changes, tire changes, insurance, and deductible payments for the inevitable collisions (with court litigation from a single accident without even physical injury lasting in years of time-consuming litigation), driving for a rideshare is something I quickly turned down as an employment consideration.

Re: Income of an uber driver

#14

Post by dsl » Sat, Jul 18, 2015, 6:07 PM UTC

xname wrote: post #2

This is easy. If Uber driver does not make money, there will be less Uber drivers, so the fee will come up. There's nothing need to be complainted about.

This assumes zero churn. With how aggressively Uber is recruiting drivers, I would hypothesize that it takes the average driver a few (maybe as many as 4-6) months before they realize it is a losing proposition.

Re: Income of an uber driver

#15

Post by swagv » Sat, Jul 18, 2015, 6:12 PM UTC

Uber driving is like a scam for people who don't understand self-employment taxes.

Re: Income of an uber driver

#16

Post by russell_h » Sat, Jul 18, 2015, 6:17 PM UTC

My sense is that Uber's current rates aren't entirely sustainable for drivers.

They're able to recruit people who already own a car, and treat it mostly as a sunk cost, when in reality being an Uber driver will significantly decrease the vehicles lifespan and increase maintenance costs.

Re: Income of an uber driver

#17

Post by HaloZero » Sat, Jul 18, 2015, 6:17 PM UTC

To those of who you are against including the depreciation cost of the car. Here's the math:

Income: He works 10-12 hours to make $150/day and works every day of hte year. He will make $54,750

Expenses: He calculated 94,900 miles driven total assuming working 365 days a year. That's about 260 miles a day of driving.

Gas cost $12,775 Oil changes $855 Tire replacement $960 Misc Repairs: $5000

So that adds up to $19,950 in expenses. You could reduce that by doing oil changes yourself but whatever. Misc repairs at $5,000 depends on the car itself.

So that comes out to be about $34,800 or $39,800 if you're really hating on Misc repairs.

Let's also assume that he is in fact working 10 hours a day to get that $150/day.

So his hourly wage is about $9.5/hour It's $10.9/hour if you don't include the $5,000 toward repairs.

I've limited it to expenses that directly relate to the uber driving specifically and not costs such as depreciation and insurance with come with car ownership versus actually putting miles on your car driving it around.

Re: Income of an uber driver

#18

Post by codeTheWorld » Sat, Jul 18, 2015, 6:17 PM UTC

jakejake wrote: post #12

xname wrote: post #2

This is easy. If Uber driver does not make money, there will be less Uber drivers, so the fee will come up. There's nothing need to be complainted about.

In my experience the result seems to be more crappy cars and less "hip" drivers, if that's worth anything. I read the original plan the founder wanted was an instant "classy" ride. When I choose uberx I don't really expect it to be classy anymore, which is fine most of the time. But it has been something I've noticed. I wouldn't expect a driver to make nothing just to have a new car to drive for uber.

UberX wasn't in the original plan at all. The "classy" was UberBlack.

Re: Income of an uber driver

#19

Post by CydeWeys » Sat, Jul 18, 2015, 6:22 PM UTC

HaloZero wrote: post #17

To those of who you are against including the depreciation cost of the car. Here's the math: Income: He works 10-12 hours to make $150/day and works every day of hte year. He will make $54,750 Expenses: He calculated 94,900 miles driven total assuming working 365 days a year. That's about 260 miles a day of driving. Gas cost $12,775 Oil changes $855 Tire replacement $960 Misc Repairs: $5000 So that adds up to $19,950…

It's interesting that the final wage comes out to around exactly what minimum wage is. Market forces at work? Driving for UberX isn't exactly a skilled job, and there are enough people with driver's licenses out there that there will always be enough supply of labor (unlike, say, software engineers).

Basically, Uber is paying minimum wage not really any different than Walmart, which is around what you'd expect for a low skill profession. And it's hard to say if the Uber drivers can even unionize effectively to capture more of the profits, because there's always so many potential scabs in the wings.

The only real solution here is a higher minimum wage, which would filter through to UberX driver earnings through market forces.

Re: Income of an uber driver

#20

Post by bayesianhorse » Sat, Jul 18, 2015, 6:26 PM UTC

It seems like Uber drivers often don't understand the economics of driving for Uber. Fulltime driving for Uber only seems to make sense for people who have no other choice and are very frugal (or negligent) about their car. Part time may make sense for some people with too much "car" and time on hand. Against both of these groups, the desperate and the part-timers, it's hard to compete and make a living...