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How much of that benefit is purely short-term though? In a hypothetical world where Uber and Lyft's current pathway to profitability never pans out, what are th
by cc439 7y ago
How much of that benefit is purely short-term though? In a hypothetical world where Uber and Lyft's current pathway to profitability never pans out, what are the ramifications. The most obvious one is that their fares will increase by 25-50% depending on the market, pricing them well above the legacy taxi services that existed before the arrival of these VC-backed companies. The second most obvious ramification is that many of those legacy taxi services have been run entirely out of business in smaller markets. My home county of 1m+ people is now down to 1 shady taxi service with a handful of ancient, beat up Crown Vics (last produced in 2011) and they only hang on due to the incredibly low standards for taxi regulation in our region. If Uber and Lyft fail or become far less useful due to cost increases, there are significant barriers to entry for a new, clean, and professional taxi service to enter the market as they don't get to play by VC rules and have to start a highly capital intensive (for a small business) operation by conventional rules while only being able to attract a customer base entirely through conventional means of marketing, and all at a very small cost advantage versus the ride sharing giants.
- stanleydrew 7y agoI don't really understand the point you're making. Why do small taxi companies have any more right to exist than Uber/Lyft? Or what exactly are they better at than Uber/Lyft that would justify keeping them around? Any driver who was formerly driving for a small taxi company could simply drive for Uber/Lyft. So what is the benefit of having management be local vs centralized?
- dmix 7y agoBecause they make money and they are being all corporatey in their big corporation buildings! Local artisnal petite bourgeoisie businesses only available to middle class people living in downtown urban areas are the only moral form of capitalism! That and when you get tired of the city and decide to start a farm in rural Oregon.
- treis 7y ago>How much of that benefit is purely short-term though? In a hypothetical world where Uber and Lyft's current pathway to profitability never pans out, what are the ramifications. The most obvious one is that their fares will increase by 25-50% depending on the market, pricing them well above the legacy taxi services that existed before the arrival of these VC-backed companies. For most U.S. cities that Uber/Lyft now service there really wasn't a taxi service before them. You could get one at the airport and possibly in certain other areas of the city like by major hotels. Everywhere else it was call a company and maybe they'll show up at some point.
- tokyodude 7y agoif there is a demand I'd expect something to come up Note that Uber/Lyft do something the taxi companies can not. They scale to meet demand. If 1000 drivers are needed between 6pm and 8pm then they'll likely get 1000 drivers. Taxi companies can't do this as they'd lose money on drivers and cars when all of them are not in use.
- robertAngst 7y ago>fares will increase by 25-50% depending on the market, pricing them well above the legacy taxi services Hahaha Right now they are 1/4 of taxi prices. Or at least last time I rode a taxi.