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Can Uber ever make money?

economist.com

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Re: Can Uber ever make money?

#371

Post by photonios »

astrodust wrote: post #220
GordonS wrote: post #218

Earlier quoted context omitted.

> Uber's criteria for what qualifies as an acceptable car has dramatically declined to the point where even Taxis are sometimes "nicer" In my travels to the US, which almost exclusively meant Houston, the taxis were always very basic, "boxy" cars; not sure about make/model, but they always felt "cheap". Meanwhile in Europe, a lot of taxis are Mercedes E class saloons, or high-spec saloons from other makers.

A taxi in Europe is akin to an "airport limo" in North America. The differences are astounding.

Depends on where you are in Europe.

Here in Romania, taxis are consistently horrible. The cars are usually old and not well maintained. It's not uncommon to see duck taped airbags. The drivers are far from friendly.

But! They are consistently horrible in my experience. Not once has one ripped me off and they always use the meter. They know every address you throw at them and get you there safely. No matter the hour. They're also dirt cheap. 2.25 RON/km. So that's about $0.55/km.

For the Romanians reading this; Bucharest is an exception and I've had nothing but bad experiences with cabs there. My experiences are based on using cabs weekly in major Transylvanian cities.

Re: Can Uber ever make money?

#372

Post by lugg »

URSpider94 wrote: post #345
lugg wrote: post #312

Earlier quoted context omitted.

The beauty of the uber model is that drivers don't even need to break even. Very few I speak to are doing it full time to make money. Most are doing it as a side hustle for a little extra cash before or after work. Or they're using the money to justify spending more on their dream car. They don't need to break even, they needed the car anyway, it would depreciate roughly the same amount anyway. Or at least the extra…

A lot of drivers are acting irrationally (in the economic sense). The number of miles you put on driving for a car service will almost certainly be consequential to your car’s service life, if you are making any money at it. But, new drivers see cash in their bank account every week, and it’s hard to link that to having to splash out $25k for a new car down the road. I expect a lot of these drivers will bow out when…

> Having people who don’t understand how to calculate their costs in the market drives down wages for everyone.

Yup, this was my point! :)

Re: Can Uber ever make money?

#374

Post by plankers »

fwip wrote: post #315
rossenberg79 wrote: post #297

Earlier quoted context omitted.

Having to do fares in the bad part of town is the reason my brother carries a loaded gun under his seat while driving for Uber.

Bringing a loaded gun with you is a good way to end up dead.

Well it's not very useful without the bullets.

Re: Can Uber ever make money?

#375

Post by olejorgenb »

This might be ignorant, but I've wondered about this for a while.

Isn't Uber essentially a software company? The drivers doesn't get anything besides their share of the fares?

According to the free part of the article they've lost 7.9 billion dollars since 2009.

How expensive can it possible be to develop and operate their software? According to some sources uber takes a cut from 20-25% (although some claim much higher fractions in practice)

http://www.businessofapps.com/data/uber-statistics/#6 claims ~10B _quarterly_ revenue for 2018, with net loss at close to 1B. (EDIT: seem the revenue is counted as full fare price - not ubers cut, so that brings "actual" revenue to ~2B/Q)

How are they not making money..? Lots of normal taxi services have booking apps too. If they IPO it'll be interesting to see a more detailed breakdown of their costs.

EDIT2: found the IPO prospectus including some numbers: https://www.sec.gov/Archives/edgar/data/1543151/000119312519...

Re: Can Uber ever make money?

#376

Post by [deleted] »

sib wrote: post #311
caseyohara wrote: post #225

Earlier quoted context omitted.

> A driver who doesn't talk to me I wish "Quiet Ride, Please" was an option in the app.

I always thought this should be a "swipe left / swipe right" thing for both driver & passenger. If they both indicate they want to chat, talk away.

[deleted]

Re: Can Uber ever make money?

#377

Post by gambiting »

wrboyce wrote: post #254
dreamcompiler wrote: post #232

Earlier quoted context omitted.

That's because in the UK they have to know the area before they can get a taxi license. No such requirement exists in the US.

That is only true if you want to drive a black cab in central London. My northern taxis are just as OP described.

Up here in Newcastle I'm yet to meet an Uber driver who knows their way around, and it's a tiny city. My favourite was the guy who had no idea how to get to the airport despite it being literally 15 minute drive from the city centre. One of the roads was closed(and Google maps of course had no idea about it, it's completely useless), so the driver started asking me for directions to get to the airport - and my only reaction was "dude, seriously? You drive a taxi for a living and have no idea how to get to the only airport for a mid-size city??". Literally every Uber I've taken so far was both useless at navigating and borderline criminal with their driving ability(driving too fast, too aggressively, not paying enough attention).

Re: Can Uber ever make money?

#378

Post by rightbyte »

URSpider94 wrote: post #347
Simon_says wrote: post #268

Earlier quoted context omitted.

Yes, this is how supply and demand works in a healthy market. Riders should pay higher prices for tasks that drivers are less willing to do, and concomitantly drivers should get paid more for those tasks.

Here are a couple of replies: 1. As a society, we don’t allow people to discriminate against protected classes in commerce. Most of those “bad” neighborhoods are actually not bad, they are just populated by people of different race or social status. 2. Unregulated auctions work well when there is symmetry of information and negotiating power. That is not the case when I’m standing on a street corner trying to get hom…

It's way too much to ask a driver to risk driving in some gang land area or pick up riders that in way too many cases are violent criminals.

If you pick up random strangers in "bad" neighborhoods as a private person you are insane. Somehow taxi drivers are bad persons when they don't.

Do these things full time you will sooner or later get in trouble.

Going after drivers is going for the symptoms rather than the cause and quite selfish. If I wouldn't do it myself I don't want anyone else being forced because they have lower income than me.

Re: Can Uber ever make money?

#379

Post by kelnos »

BigJono wrote: post #261
kelnos wrote: post #234

Earlier quoted context omitted.

I wish drivers that pick me up from the airport (or who are taking me to the airport at an early hour) would have some sense of situational awareness and realize that someone who just got off a plane (or is waking up early to catch a flight) might not be feeling all that chatty, and just wants to sit back, close their eyes, and enjoy some peace and quiet.

I wonder if this is a uniquely American problem. Over here (Australia) it's always a couple of short sentences ('how'zit goin'?', 'yeah good') then awkward silence the rest of the trip. Unless the cricket is on the radio, then all bets are off.

I figure probably 80% of my rides are as you describe. But I don't know what it is about airport pickups. I guess it's easy to start a conversation with "where are you flying from?" maybe, and then they don't want to stop after I give a terse answer.

Re: Can Uber ever make money?

#380

Post by kelnos »

cabaalis wrote: post #266
kelnos wrote: post #221

Earlier quoted context omitted.

The problem there is twofold: 1) Many drivers from your town would likely geofence themselves to your town, reducing the supply of drivers that will drive to the metro area, increasing wait times and driving up prices, making riders unhappy. 2) Drivers would use this feature to avoid driving to "bad" parts of town, making transportation discriminatory. (In ways that are illegal for traditional taxi companies, so Uber…

For #1, it seems the market would adjust. We already see complaints about drivers not knowing the area they're driving in. Would it reassure riders to know that their driver spends 99% of driving time in an area they're riding? For #2, sincere problem for which I am not aware of a good solution.

Not if there aren't enough drivers there, period. I'd much rather a driver unfamiliar with my city who needs Google Maps to get me to my destination if the alternative is I have to wait 20 minutes for a car.
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