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It's not that they aren't a useful service at whatever price level would bring them profitability at current sales levels as much as that the demand curve may b
by mandelbrotwurst 8y ago
It's not that they aren't a useful service at whatever price level would bring them profitability at current sales levels as much as that the demand curve may be such that if they were to raise prices theyd lose at least enough sales that it might not bring them to profitability at any price point.
I.e. while someone earning $200K might decode they can afford $20 rides rather than $10 ones, someone making $50K might think differently. The "who cares" when people go back to riding the bus is Uber.
- ghaff 8y agoThat's true. But there's a clear existence proof that there is a market for people willing to pay what it costs to drive them around. It existed before Uber and Lyft and it still exists alongside them. Certainly there's a price sensitivity curve but there's no reason to believe a national on-demand service like Lyft or Uber couldn't operate profitability in the absence of being undercut by VCs burning money.