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Spend analysis of 6 years, 686 rides, and $12k spent on Uber (2017)
- philliphaydon 8y ago> car ownership cost $11,783 per year, most of it depreciation Does depreciation even matter. Most people don’t sell their cars.
- cyberferret 8y agoI think he may be talking 'accounting' depreciation, which is what accountants would use when calculating the balance sheet asset entries on company cars etc. NB: Can't read the site or full article - not sure if it is the 'HN Hug of Death' but it is timing out for me.
- sdfx 8y agoIn the US the average length of car ownership for new cars is 6.5 years [1], so it does matter what your car is worth after this time. Not sure if it amounts to ca. 6,000 USD per year, tho. That's a lot of depreciation. [1]: https://www.statista.com/statistics/581017/average-length-of-vehicle-ownership-in-the-united-states-by-vehicle-type/ https://www.statista.com/statistics/581017/average-length-of...
- philliphaydon 8y agoOh wow. Ok. I would drive a car till it died. Wouldn’t buy a new one every few years.
- jonknee 8y agoThe type of person who buys a brand new car probably likes a brand new car (new features, status, reliability, etc) and that doesn't change after a handful of years. Or the other way around, the type of person who wants to maintain an older vehicle is probably not the type of person who will buy a brand new car. Obviously there are exceptions, but the used car market is much larger than the new car market so most are selling.
- patio11 8y agoHere, let me rephrase: the expensive part about car ownership is purchasing cars, not gas, insurance, or maintenance.
- anoncoward111 8y agoAgreed, but now that the problem has been identified, why do so many people continue to finance or lease new cars? Car maintenance isn't that scary if you have a steady income and buy something rational (90s japanese instead of 2000s range rover)
- maxerickson 8y agoBecause they don't consider the total costs and $300 a month is "affordable" or whatever.
- zip1234 8y agoI know people that lease just because they want a new car every three years and can afford the $3600/yr for that.
- bronco21016 8y agoI’ve noticed that many of my friends simply accept that leasing for $200-400/mo in perpetuity is simply easier than dealing with a car that begins to become unreliable. Humans are weird in that spending $1,500 on car repairs one time in 24 months just seems way more jarring than spending $300/mo but spending $0 on repairs.
- kd5bjo 8y agoThey’re paying extra to not have their routine interrupted; depending on what else is going on in their life, it may be the right decision. Money is a tool to do things you want, not a scorecard.
- Anderkent 8y agoPeople are risk averse; predictable expenses are easier to plan around than unpredictable ones. What if you're unlucky and it breaks twice in a year? Or the first repair is bungled and you have to go to a different shop, and argue the first one into giving you your money back?
- robinwassen 8y agoNot taking deprecation in account when buying a car makes the calculation way off. It even applies when you own it the whole way from the factory to the junkyard. A rule of thumb that I use is that the value of the car halves every fourth year. So if I buy a car for $20 000 I can count on a monthly cost of $208 for the deprecation the first four years, that exceeds all other costs of ownership in my case.
- dsfyu404ed 8y agoRegardless of age and mileage there's a floor value for a vehicle based on vehicle type, options and condition. In states with annual safety inspection anything in passable condition gets an artificial price bump of about a grand compared to the same vehicle with a cracked tail light, 1/32 less tread or a missing sun visor.
- mavhc 8y agoBuy used, problem solved. Bought a £8k 6 year old car, sold it for £2.5k after it broke and wanted £2k for repairs 6 years later. So £1k/year. Current car costs £0 in tax, £0.02 p/mile, £360 insurance per year
- philliphaydon 8y agoMy mum bought a car in 1992 for ~$16,000 NZD. Still driving it today. It’s a Toyota so maintainence is tiny. My dad still drives my 1998 Mitsubishi. So when I see the price including depreciation it seems odd that people change cars so often they worry about resale value. I would either buy new and drive it into the ground or buy second hand.
- noelwelsh 8y agoThis. Recently bought a car that was about 1 year old, low mileage, and half the cost of new. Why bother buying a new car?
- tadzik_ 8y agoBoth cars I owned were used, but if I had excess money I would probably go for a new car because of how shit the 2nd hand market can be. You never really know what you buy unless you pay a 3rdparty expert to verify that the thing you're buying isn't critically flawed in a non-obvious way.
- mavhc 8y agoBoth mine were bought from dealers used, so less risk, they both had 1 year warranty I think
- CalRobert 8y agoWell sure, cars break after all, and many people will find they need to replace their car instead of living without one. If I buy a washing machine for $600, and it breaks after 5 years, I can consider that machine to have cost me $120 a year, even if I never sell it.
- pc86 8y ago> Most people don’t sell their cars. [Citation needed] Trading your car in is indeed selling your car.
- thisisit 8y agoGoogle cache link: https://webcache.googleusercontent.com/search?q=cache:j_-ohhPT18AJ:https://nealmueller.com/uber/&num=1&hl=en&gl=in&strip=1&vwsrc=0 https://webcache.googleusercontent.com/search?q=cache:j_-ohh... Uber actually loses money on each ride. So I don't think the same analysis be hold long term, especially when the company starts to raise its prices. WSJ recently wrote an article on how it was possible to live in SV for free thanks to the VC fueled economy. They gave example of a guy who financed his Mini Cooper using startup deals, which I think is a better deal than subsidized rides ;) https://www.wsj.com/articles/how-to-live-in-san-francisco-without-spending-any-money-1525029628 https://www.wsj.com/articles/how-to-live-in-san-francisco-wi... Archive link: https://archive.fo/PWVnU https://archive.fo/PWVnU
- onion2k 8y agoUber actually loses money on each ride. This is only true if you're using referral credit. In well established markets (eg San Francisco) very few rides are subsidized, and Uber makes a healthy profit.
- martinald 8y agoNot entirely sure about that, they have very extreme driver turnover and are constantly offering very expensive incentives to drivers. I wouldn't be surprised if they are somewhat profitable in established markets but I'm not sure if it's 'healthy'.
- jryle80 8y agoFor which companies are those driver driving post-Uber? There aren't many choices, SF specifically. Talking about turnover. Any ideas how that's for Uber compared to Lyft et al.?
- nealmueller 8y agoHi, I'm Neal, author of this analysis. I bumped up my GCP instances so it should work now. Thanks for sharing the static links.
- jopsen 8y ago> What could $703/month buy you? Well, four years of $703/month and you’ll save enough to climb Mount Everest unguided. I'm not sure the price tag is what's stopping me from climbing Mount Everest _unguided_ :)
- rekshaw 8y agoData is as of 2016. Would be curious to see a follow up post on this, especially the comparison with Lyft.
- caleblloyd 8y agoThe monthly savings calculation in this article largely based on the depreciation of a brand new BMW M3. I think it would be good to use an average vehicle depreciation in there for comparison.
- willvarfar 8y agoThe author says they had an M3 that needed replacing; they replaced it with Uber instead.
- arkades 8y agoYes. I don’t think the poster you’re replying to missed the author’s position; I think they were just pointing out that it generalizes poorly, since the “savings” all pretty much came from that single source, which few other people share. As the author said: their other car held its value. If he’d had 2x of that car rather than a BMW, the results would look wildly different. Most folks don’t have that situation.
- bronco21016 8y agoThis analysis looks amazing. We’re currently a two car household with one of the vehicles being a little older and slowly starting to lose some reliability. Before rideshares it would be pretty important to go out and find a newer, more reliable vehicle so I could ensure I make it to work. This winter after the car sat for a few weeks it wouldn’t start. Rather than spend 30 min messing with it and being late for work I simply hopped in an Uber. When this vehicle does meet its eventual demise I will likely advocate for becoming a single car household. The biggest hurdle ridesharing has in replacing vehicle ownership though is the one off scenarios where having a vehicle is just so valuable in terms of time and cost. We’re in the middle of remodeling our bathroom. We did plenty of planning and sorted out all of the materials and tools we would need and made a giant list. I went to Home Depot and bought just about everything in one trip and loaded it in a truck and drove it home. As the project has progressed though, there are constantly times where I find I need a tool, or need a different fitting for the plumbing, etc. I just hop in the car and head over to Home Depot quick and grab it. Uber would cost me about $15 round trip for each one of those visits. I haven’t gathered the receipts yet to track how many visits I’ve made but I imagine it would add up pretty considerably. This is just one example. As an expecting father I can only imagine how much of a nightmare loading a car seat in an Uber would be. I love having the option of a ride share, and I think its fantastic for the opportunity it provides those who many not have access to a car for various reasons. However, I’m not sure ridesharing will ever reach the point of being able to completely replace car ownership for the average American household. I’m confident we’ll hang on to at least one vehicle for the forseable future.
- sureaboutthis 8y agoThis is exactly the question and situation I am in as our 2004 Jeep probably won't pass inspection come this December and we are thinking about which car to buy and if we should buy another car.
- dgacmu 8y agoWhy wait? :) I did this a while ago (2car -> 1car, with a child), and have zero regrets. We now have two kids, and are still 1-car'ing it, with the occasional rideshare. It's fantastic not having to deal with the crap a less-used car comes with. I wrote up my analysis, with a spreadsheet you can plug your own numbers into: https://da-data.blogspot.com/2015/06/why-my-car-cost-more-than-taking-uber.html https://da-data.blogspot.com/2015/06/why-my-car-cost-more-th... We chose not to go zero car for many of the reasons you mention (and, in fact, ended up replacing our 2007 ford focus this year). But going from two to one is very freeing. Loading a car seat into a rideshare isn't bad, btw - the LATCH anchors make it almost routine once you're used to it. Our travel carseat is a little more twitchy, but none of it is very bad.
- lewich 8y agoIf you don't buy BMW M3, then Uber won't save you 700/month. Figures look viable only because Vehicle expenses were $11,783 per year. ~The 2008 BMW M3 was depreciating in resale value $8,333 per year. ~
- gormz 8y agoExactly. He had two very expensive vehicles. If he leased or bought a used car that is not luxury, he could spend less than he does on ubers.
- tomatotomato37 8y agoExactly. I don't know the use of comparing a European GT car with a badge tax versus riding in the back of someone's accord. A more useful comparison would be to use the model of the average Uber driver
- alach11 8y agoAs a point of reference, I drive a 2009 Kia Optima and average $1800 per year all-in expenses. This is with no car payment (it's paid off), only liability insurance, normal maintenance (including occasional large expenses), and ~10,000 miles a year driven. To add a car payment might be another $2000-$5000 a year.
- peterwwillis 8y agoCompare this to Philadelphia, where a monthly Septa pass (that's bus+trolley+subway) is $96. That's a savings of $856/year over Uber. I have been carless for three years and my savings account is very happy now. Regional Rail passes are $105, so you don't have to live in the city, either.
- 2RTZZSro 8y agoThe additional cost is for door-to-door service. Not everyone in the Philly metro area is within walking distance to a Septa location, nor do people want to spend the additional time to arrive at a Septa location and then ride to work.
- sdhgaiojfsa 8y agoBig supporter of public transit, but this is apples to oranges. Nine times out of ten, the Uber is going to get you where you want to go a lot faster, unless embarkation and destination are both on the same public transit line.
- bunderbunder 8y agoI suppose it varies by city, but to me we're not talking about comparing apples to oranges. We're talking about exchanging apples and oranges for bananas, just in different ratios. I lived carfree in Milwaukee for a while (picking that as an example of a city that only has bus service), and the time savings really didn't seem that bad once I got used to it. A trip to one of the shopping malls on my side of town was about the worst-case scenario, and there it typically took ~40m on the bus, versus ~20m by car. I like reading and I had a Nintendo DS at the time, so that ~20m difference was spent doing what I would have probably done with the extra time, anyway. I was just doing it without a cat in my lap. An easy trade, I thought, considering that I was typically spending no more than $10 a week on bus fare. Often more like $0, especially in the summer, when it was more fun to get around by bike. Owning a car or using a taxi service for my main way of getting around would have cost thousands per month. That's quite a few fewer apples, and not a whole lot more oranges.
- peterwwillis 8y ago
- IkmoIkmo 8y agoInterested to see how he'd fare under carsharing as opposed to ridesharing. It seems UberPool is about $30 an hour per hour, UberX $54. But car2go for example is around $20-25 depending on the car and city. (not available in SF) And that doesn't require you to share a car with other people (which is fine as a taxi service, but perhaps too intimate for many as a daily routine). That having been said, in terms of 'car hacking' he should be able to do much better if he just bought a cheaper but reliable car. He never owned the car for status purposes, his previous choice of car seems like a bad benchmark to compare Uber to. 8k depreciation is just crazy, might as well just lease at that point or buy a small, cheap japanese car, like a Honda Civic or something. Maintenance is a few hundred bucks, you can buy em for two years worth of his BMW depreciation, pretty fuel efficient. I think ridesharing is great, but you shouldn't compare it to a newly bought $80k BMW benchmark imo.
- lettergram 8y agoIn 2010 I bought a Nissan Versa for around $10k (lightly used). It still runs like a champ, the door handle has been replaced, a few belts, tires, oil, etc. However, all the repairs in 8 years is less than $5k. That's around $700 a year, and the damn thing has 165,000 miles. Still starts, drives, no rust. Should easily be able to pull 200,000 miles off of it (or another 2 years). I think the car today is still worth a ~$1k - $2k.
- dorfsmay 8y agoBut to compare it to car and ride sharing you need to add insurance, fuel and parking cost. Also, 165 k miles and you never had to change the timing belt, break pads etc? Does the 5 k$ include all those costs?
- lettergram 8y agoYes, $5k covers this costs. A timing belt or break pads are $100 - $200 for the whole thing. Insurance isn't included sure, nor is gas. According to my mint, on average I spend $500 / year on insurance (two cars) and gas is $1000 / year. I also get things like freedom to drive cross country (which I've done) or go to national parks. Which adds value. Take all that and its still what: $8k + $4k + $10k + $5k = $27k For 8 years... And I gurantee I travel more than 686 rides, as I drive pretty much 365 days a year. Plus it has some value. In many cases, as with most things, convenience comes at a premium. That's what ride sharing is. I use it too when traveling, but the car is way cheaper long term.
- swarnie_ 8y agoAm i the only one that finds Uber a lot more expensive then local, traditional taxi rivals? In the UK just outside London Uber's quotes last Friday and Saturday night were 50%-100% hire then other competitors.
- garagemc2 8y agoHad the same thing in Brighton. Uber was quoting £90, taxi stand was £48.
- avaika 8y agoIt depends on region, daytime and traffic a lot. E.g. in my area sometimes it's much cheaper than its competitors (up to 20% difference) and MUCH cheaper than a standard call taxi (up to 50% difference), sometimes it's a double from competitors prices. You just have to catch the right moment. I even have an application for my local region which estimates prices in different services right now and suggests the cheapest option. Abroad (in countries like India) Uber (or similar services, e.g. Ola) is the easiest way to get an honest price without heavy bargain (which is also time consuming) and complicated explanations where you wanna get.
- lavezzi 8y agoWhen I come back to London, Uber seems ridiculously expensive compared to Chicago. Plus the lack of Pool options (even to/from Heathrow, etc) doesn't help.
- chx 8y agoHow come noone is pointing out that paying 12041 to Uber is paaying 12041 to undermine society by ignoring the rule of law and to roll back protections organizer labor achieved over a hundred years? Shame on you.
- deleted 8y ago[deleted]
- trumped 8y agoIf what Uber is doing is illegal, why are they allowed to continue operating?
- grepthisab 8y agoTruly an awful line of reasoning. To add a little substance to that comment per HN guidelines: they could be being investigated now, the gov may not have caught up with their illegality yet, etc. etc. etc.
- trumped 8y agoright, and the comment that I was replying to was just assuming that it was illegal even if they haven't been convicted... I know nobody likes Uber here, including me, but it's a bit of a witch hunt
- kinsomo 8y ago> If what Uber is doing is illegal, why are they allowed to continue operating? Because the set of things that are wrong is a subset of the things that are illegal. Uber also has a documented history of doing actual illegal things. It even went so far as to build technology specifically to avoid law enforcement authorities: https://www.nytimes.com/2017/03/03/technology/uber-greyball-program-evade-authorities.html https://www.nytimes.com/2017/03/03/technology/uber-greyball-...
- Anderkent 8y agoSome laws should be ignored; it's how the law system improves. A law that is obeyed by everyone will never be changed, because the opportunity cost is not made visible.
- jlebrech 8y agothe site is down so I don't know how many miles his commute is. but what if he factored in riding a bicycle when it isn't raining (into work) and using Uber on days when it's raining in the mornings?
- jlebrech 8y agoI made this schedule including cycling and public transport https://imgur.com/a/aiAdbZE https://imgur.com/a/aiAdbZE even a weak rider can save money by getting a week pass when their legs are sore. I'm assuming there's a week based pass in your area.
- SkyPuncher 8y agoHe doesn't address mileage at all (shocker). Based on a $1/mile estimate, he traveled about 12k miles over 6 years (500 miles/year).
- dannyw 8y agoI wonder how much his rides would have cost if Uber didn't classify him as a 'frequent rider': https://therideshareguy.com/uber-is-ripping-off-frequent-riders-and-heres-how-to-avoid-it/ https://therideshareguy.com/uber-is-ripping-off-frequent-rid...
- gormz 8y agoI think the real problem is that you had expensive cars. No shit you save money when you take ubers rather than owning a BMW M3 and (what I assume) was a decked out wrangler. If you bought a sensible car, your monthly costs could be much lower.
- CiPHPerCoder 8y ago> If you bought a sensible car, your monthly costs could be much lower. $12,041 over 6 years is $2006 per year, which is about $167 per month. All of my friends pay about that much just for car insurance every month. Throw in a car payment ($200/mo. - $500/mo. depending on the terms of the lease), gas, and maintenance (regular oil changes, tire replacements, etc.) and you'll end up way north of $12,000 after 6 years.
- the_gastropod 8y ago> Throw in a car payment They said sensible car. A car you need a loan for is not a sensible car.
- CiPHPerCoder 8y ago1. The two-word phrase sensible car was not defined by the comment I replied to; it was left up to interpretation. 2. Even if I take your assumption as the other poster's definition of sensible and remove any car payment, gas + insurance + maintenance yields a 6 year cost above $12k. My point stands.
- the_gastropod 8y ago> gas + insurance + maintenance yields a 6 year cost above $12k This will depend on the individual circumstances. Liability insurance is significantly cheaper than full coverage. Average annual liability insurance is ~$552/year [1]. Driving the ridiculous 12k miles per year that average americans drive, a Prius would burn roughly 226 gallons of gas. At today's price of gas ($2.94), that's $664/yr. At 6 years insurance and gas will run you $7,296. I'm very skeptical of depreciation + maintenance blowing $4,704 over 6 years on a Prius... [1] https://www.carinsurance.com/average-rates-by-age.aspx https://www.carinsurance.com/average-rates-by-age.aspx
- mettamage 8y agoI can't read the website, hug of death maybe? I would like to point out that in some other countries Uber fare prices are much higher. I live in The Netherlands and I remember 1 km to equal about 2 euro's, whereas in the US it would equal to about $1.25, meaning that Uber is twice as expensive in The Netherlands. I don't know how it is now, but my point is that it is quite country dependent.
- dalore 8y agoBut people in the US need to travel further since it's infrastructure is all built around cars. Netherlands isn't as focused on cars, more bikes.
- mkovji 8y agoIs Uber's plan more like keep making loss and keep pushing the world to a state of rent a car for each ride and then get to a state of not own any car and then ones we get to a state of no one owns a car and every one takes a Uber then just keep jacking up the price at will and make more money out of us, and at that point we wont have a car and instead of buying one we will better say pay 5$ extra and take Uber and eventually reach a state where we spend twice the amount or owning a car per month on Uber and some smart guy figures out this and then we all go back to owning a car using Uber rarely at times of need. Y go the long route we can simply stay in the current or previous state and use it like a taxi rarely wen needed.
- TACIXAT 8y agoI think the endgame is self driving vehicles which would hopefully bring the price down.
- SkyPuncher 8y agoThe really frustrating thing about this analysis is he completely ignores mileage. However you split it, that's a huge factor in a vehicle's maintenance cost and depreciation. He compared maintenance on vehicle that clearly must be driven significantly more than he took Uber. Since he also has two other vehicles, he was clearly using those to drive too. He's sold them now, but he doesn't mention anything about the cost of Turo which he suggests as an alternative. I have no idea exactly what Uber breaks down to per mile, but ridester.com suggests $1 to $2.50 per mile. Let's assume it's as cheap as $1/mile to give him the benefit of the doubt and account for UberPool. ---- At $1/mile, he traveled 12k miles over 6 years - or 2000 miles/year. * Maintenance on 12k miles would basically be nothing. No major work should need to be done in a 12k window. Probably some wipers, some fluid changes, possibly a minor repair - let's just say it's $500. * Gas - Let's assume 20 miles/galloon and $4 per gallon. $2400 over 6 years. * Insurance - The most expensive part. 2000 miles/year is nothing, but insurance doesn't work that way. Let's assume a modest $500/year. - $3000 When you add that up it comes to roughly $6k left over. You can look at this two ways. 1. Try to buy a vehicle in the $6k range and assume no-resale value. You're not going to get a great car, but it will be doable. 2. Account for only depreciation. 12k is mostly negligible miles. The biggest lost will be due to aging. That being said, as long as you avoid relatively late-model year, you can purchase basically any mid-upper car and still break even (like an M3). Plus, in both cases you get the benefit of actually owning a vehicle and not relying on 3rd parties. ---- EDIT: He also mentions using Turo as an alternative for a car. That opens up the possibility of him renting out an own vehicle on Turo. An M3 would likely catch $100/day or more. Let's say $50/rental day gets to his pocket. If he rents a out his M3 just twice/month (e.g. one weekend) and assuming the driver hits the 100 mile/day standard. He'd add only 14.4k more miles (still not a lot) and make an additional $7.2k. That pays for depreciation and leaves him room to ride share while his car is gone.
- tinus_hn 8y ago12000 miles in 6 years is 2000 miles a year, not 500.
- SkyPuncher 8y agoThank you. I'm a bloody idiot. I'll update. EDIT: I did all of the other math right except for the annual mileage.
- sbr464 8y agoCached link (site was down for me) http://webcache.googleusercontent.com/search?q=cache:j_-ohhPT18AJ:https://nealmueller.com/uber/&num=1&hl=en&gl=us&strip=1&vwsrc=0 http://webcache.googleusercontent.com/search?q=cache:j_-ohhP...
- nimbius 8y agoSpeaking as an automotive mechanic, Uber/Lyft/taxi are functionally indistinguishable from a fleet vehicle after the first year of service with the notable exception that fleet vehicles enjoy cheaper parts and service. Expect to see your brake/oil/air filter life cut in half. most of this is due to idling in a fleet-like manner a vehicle with no accomodation for greater-than-average idle times. Example: the crown victoria and F150 fleets sold to government agencies can easily sustain a 3-6 hour idle as theyre equipped with an enlarged intercooler so you dont cook the oil. Suspension suffers but not appreciably as power steering fluid, which turns to laffy taffy pretty reliably in these types of vehicles. Tire life in some cases is notably shorter due to the prevalence of sidewall damage from mediocre drivers dragging or hopping curbs. Fleet vehicles are equipped with idler/pitman assemblies which, again, are cheaper to repair and service than the more complex and expensive rack-and-pinion...which also isnt as durable for fleetlike operations. service times are also longer...so theres lost revenue. example: an AC service on a Lexus takes damned near 4 hours (I'd want the car for the day.) Service on a lincoln towncar? I might not even have to put the keys in the ignition. Theres actually a factory tool you can order from Mexico that will do it in about 11 minutes. TL;DR: if you're driving for one of these taxi services, buy a fleet vehicle used or new.
- eof 8y agoI was not aware there were a subset of consumer vehicles that were considered 'fleet vehicles.' A quick google search doesn't show me: beyond crown vics and f150 (all of them?) how do I find the full list of fleet vehicles?
- odammit 8y agoI went carless about a year and a half ago in Los Angeles (wife still has a car) and it’s been awesome. I had a ratty 2006 liberty. Going through my bank history and tabbing up costs for the previous years I figured if I spent $25 bucks a day on Uber I’d be saving money. (Actually I spend about $18 / day) Things I took into account were: - insurance - gas - parking tickets, garages and meters - maintenance (something expensive broke every few months) - Amex platinum gives a $200 credit / year for Uber Qualitative-ish things: - time saved not parking (some days I’d spend 45 minutes trying to find a spot in Venice) - time saved not forgetting where my car was parked or walking a mile to it - I do all of my emailing during my rides - credit card points I’ll hopefully never own a car again. Edit: also, zero road rage
- nealmueller 8y agoHi there, Neal here. I authored this analysis. I like your analysis too. I suspect the Amex benefit will be a rounding error at most spend levels, but is a nice benefit. I suspect the "I do all of my emailing during my rides" is meaningful as it increases your productivity a lot or gives you time back to your friends a family a lot. You could add to your list the cost a burden of keeping a car clean. Uber forces you to not carry unnecessary things which makes your life, overall, simpler, which often leads to happiness.
- odammit 8y agoYes! The amex benefit equals a free days ride (ish) once a month. Yeah the real benefit is not worry about all the worry, not dealing with all the details. Washing a car sucks. Pumping gas sucks. Changing a flat sucks.
- pdeuchler 8y agoI don't mean to be a downer here but you're essentially saying that paying for someone else's asset depreciation costs is cheaper than paying for your own asset depreciation costs plus the remaining value on a car. The reason it's more expensive to own a car is because you also own the asset. And sure, cars depreciate ridiculously fast and are horrible stores of value, but your solution is mostly saving money by offloading some risk to another party.
- burger_moon 8y agoSince everyone is already weighing in on their experiences I guess I'll add my own, I went 2 years without a car and it was great when I was in the period of my life where I wanted to be head down and studying to get a better job. I spent almost nothing on Uber because I used public transit or walked everywhere. I can count on one hand the amount of times I used Uber, seriously. Even after I bought my house which is in a suburb kind of in Seattle I continued to go car-less which included a 3mi round trip walk to the grocery store. Didn't mind it much, just had to plan around the weather. However I moved to the PNW so I could get outside and experience it, not spend my life in the city. Going hiking means 80-100 mile round trips easily on the weekend and Turo, reachnow, zip car were just not ideal for this. Cost is prohibitive if you're doing it every weekend. That's a minimum of $80-$100 * 4 if I go out just one day on each weekend. I bought a beater truck for under $3k. It has 4wd and a bed to toss all of my gear in. It's the perfect vehicle. Insurance is super cheap, only need liability because who cares if it gets totaled it's already banged up. I can run to Home Depot and get stuff for my projects around the house, toss my bikes in the bed, do my shopping. It covers all the bases and gives me the connivence of not having to deal with finding a reachnow car or meeting up with someone for Turo, etc. One important caveat, I also do my own repairs so if you aren't mechanically inclined it might not be the right choice. I only drive the vehicle on the weekends and still commute via bike or bus to work. I also noticed that because of my inherently cheap nature I wouldn't rent a vehicle to go do these things even if the end result is that it's cheaper than car ownership. My brain just can't get over the fact that I'm directly paying for the hike, or the trip to the store, etc. I think a lot of people also feel this way and idk how to overcome that kind of irrational thought, but in the end the opportunity cost of having a vehicle is worth it, if it means I'm actually getting out and doing things I enjoy instead of staying home or in the city.
- abc_lisper 8y agoI get the sentiment but I buy a new car because of safety features. I drive a Honda,will drive it for many years until something safe and cheap comes along
- romwell 8y ago>but in the end the opportunity cost of having a vehicle is worth it To add to this point: renting a car not only takes money, but also advance planning. A rental car is not waiting for you to just jump in and go at your home. I realized I want to see the total solar eclipse 9 hours before it started, and it was an 8 hour drive. Wouldn't do it with a rental.
- _bxg1 8y agoWhy would the measure be against owning two cars? What single person with no kids needs two cars?
- zaroth 8y ago> Using uberPOOL, instead of uberX, I’ve saved on 301 rides * ($14.45 average UberX ride – $10.66 average pool ride) = $1140 savings. In exchange, I’ve sat longer in rides. That’s 301 rides * 8 minutes extra minutes per ride on average = 40 more hours in pool rides. $1140 savings over 40 hours is equivalent to Uber paying me $28.50 / hour to ride uberPOOL. Since he’s paying Uber with after-tax non-deductible dollars, it’s actually more like earning ($28.50 / .6) = $47.50 per hour.
- nealmueller 8y agoTrue. Same holds for buying car, with post-tax dollars.
- mnm1 8y agoSure, you save a lot of money if you're pitting uber vs $50,000 of currently depreciating BMW that was bought new for $80k. If the author had bought a reasonably priced car (TM) the calculations and conclusions would likely be very different. Hell, his second car is reasonably priced (or reasonably old), but the egregiousness of the first car still invalidates all his conclusions. Had he had a reasonably priced car, there's no way uber would be cheaper.
- jly 8y agoAs others have noted, the depreciation and savings analysis is very misleading. Bottom line is that without the cars, he spends about $390 / month on Uber, and likely that average may have increased given the extreme low summer outlier months. In some areas where parking or insurance is expensive, this could mean large savings. In my area (Austin, TX), the all-in cost of owning a car with insurance is minimally more than this figure. You could lease one brand new, moderately priced car + average petrol costs for about the same amount. You could buy a cheap car and depreciation + maintenance would be even less.
- iamgopal 8y agoBut so much of your mental time and energy will be wasted owning the car.
- justboxing 8y agoYes. + if you live in a city, you are also fighting for on-street parking nights and weekends, and have to keep moving it every other week in order to avoid getting street cleaning tickets. Source: Me in San Francisco.
- SpecialistEMT 8y agoto me, there's also the factor of liability when I'm driving a car. explanation, I can drive a car, for fun, to go on adventures, outside of the city, or take a ride at night, but when I'm making a reasonable salary, I'd rather uberx when I commute, and totally focus on work and my mindset, than road safety. Also sometimes I'm very stressed/tired after/before work, so driving is not that safe and safety is priceless.
- lhorie 8y agoThis is sort of by choice though, no? When I was looking to rent in SF, I always asked about parking arrangements. It's not that hard to find places that have garage parking arrangements, even in neighbourhoods with crowded street parking (e.g. sunset/richmond). Also, SF seems somewhat unique in how bad street parking gets. In, e.g. Toronto, street parking in some areas near downtown is reserved for residents and outer neighbourhoods tend to be spacious enough that households have dedicated parking spaces.
- hn_throwaway_99 8y agoComparing the costs of Uber against ownership costs of 2 cars for 1 person? Why not buy a third car and make your savings look even better?
- krisdol 8y agoNot only that, but 2 cars over 2 years; and, measuring depreciation as a cost. Also, comparing the maintenance cost of owning a BMW to riding in an uberpool. I don't know about your locality, but most of my rideshare vehicles are budget sedans or hatchbacks, or hybrids -- much cheaper than 11k a year in maintenance. Would he have stuck with 2 cars for 10 years, or 2 cars for a year each? 10 years of uber vs 2 cars over 10 years will definitely shift the savings number in favor of car ownership compared to 2 years.
- psychometry 8y agoYes, and one of them is a BMW that was only three years old at the start of his data collection.
- deleted 8y ago[deleted]
- BryantD 8y agoI had the same reaction, although to be fair I think he's still saving money if you only figure the costs of the Jeep. > Incidentals on the vehicles cost $3,450 per year: $1,000 maintenance, $500 insurance, $1,500 gas (just above the national average of $1,400), $300 car washes (so shiny), $150 registration, and $0 parking. Let's say 50% of the maintenance and the insurance was the Jeep (probably not, since the BMW should be more expensive to insure), and 100% of the gas costs would go to a single car (balances out the other way, since the BMW probably had better milage). 50% of registration. Stop getting your car washed. Total: $2,325/yearly for just the Jeep. So on average he's still saving a little bit of money on the Uber. On the other hand, if you just compare the last three years he'd be better off with just the Jeep. The average is very skewed by 2011 and 2012, when he didn't Uber much. He doesn't assign any cost to wait time; I'd be interested to find out how much time he's spent waiting for his Ubers to show up. I bet Uber doesn't give you that information on your account but I don't have an Uber account to check. Interesting analysis effort anyhow! I'm critiquing but I like the general idea and I'm glad he published this.
- Bedon292 8y agoThis seems to assume that there is not a daily commute. 267 rides for the whole year is low if one were to need to drive to work. The author never seems to mentions what they do on their day to day commute, but I guess if they are a Googler there is probably a free bus?
- Skunkleton 8y agoYeah, google has a bus system. If he was going to/from work every day w/ uber that would be and additional ~470 rides per year, and for him they would be extremely expensive (SF <-> Mountain View).
- w4tson 8y agoI live in London, UK. I can’t drive. Last time I was behind a wheel it was 1999 and I failed my driving test. I get the train places and taxis the other end (Uber if the city allows). I’ll admit a few times a year I think it would be nice to drive and I intend to take my test again one day but It’s down list of stuff do with learn the banjo and work on my Haskell
- maherbeg 8y agoI'm curious as to what this will look like with using e-scooter rentals to replace some of the shorter rides.
- gesman 8y agoBut you can get hotter girls with M3 :)
- sfmike 8y agoOne thing I think that is overlooked here is drinking alcohol. Even if you drive and pay for the car payment and insurance at a very cheap rate of 200/month for both, there's gas and maintenance which should be at least another 50-100 per month. But if you're a drinker even casually or you go out just on weekends you will have to uber and leave the car and incur uber costs regardless. After work Happy hour? drink or two at the end of office day? Can't drive. Point is if you are a drinker for whatever reason there's huge perks to uber and not having a car. Also tax wise uber being used as transportation versus a vehicle where commuting is not deductible(starts from place of work not to as contractor). Overall the tax write offs and being able to drink is a huge perk should your lifestyle be similar of course.
- httpz 8y agoYou can't really compare owning a M3 to riding Uber though. If you are a type of person who cares about how fun your car is, Uber is not an alternative for a M3. If you're the type of person who only cares about going from point A to B, you shouldn't have bought a M3 in the first place.