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So... Please help me to understand the math here. My latest Uber trip was 10 minutes, 3 miles long and 10 bucks. Assuming it's a typical trip and also assumin

So... Please help me to understand the math here. My latest Uber trip was 10 minutes, 3 miles long and 10 bucks. Assuming it's a typical trip and also assuming the driver spends half of the time getting to the customer, we have, $30 and 18 miles per hour. 18 miles is one gallon of fuel at $2.00 and, say, another $3.00 in car amortization. Subtract fees, add tips and incentives and we end up with, give or take, $25. That seems like a reasonable salary?

hansvm 6y ago
Assuming a single data point is representative could add a lot of bias, the cost per trip estimate is probably low given that newer nicer cleaner cars are required, that assumes drivers are able to drive 100% of the time, it assumes all times of day are equally viable so that there are enough total hours to turn that into a liveable wage, and it's probably a generous representation of tips and a naive view of fees and incentives outside of when a driver first starts. Your numbers might work out, but studies indicate less income in practice, and there are plenty of potential sources of error in your methodology, so I'd be inclined to believe there's something wrong with that ballpark estimate.
- AlexTWithBeard 6y ago
  > a single data point is representative Please feel free to add your data. I don't think it will change the estimate dramatically. An airport trip takes about an hour and costs $80, which sums up to similar numbers. > that assumes drivers are able to drive 100% of the time No, it doesn't. Reread my message. > it assumes all times of day are equally viable True. I've ignored surge pricing.
  - hansvm 6y ago
    > Please feel free to add your data. I don't think it will change the estimate dramatically. An airport trip for me is usually around $15 and 20min. That's in the same ballpark, but even if we get several people from HN to weigh in that doesn't paint a comprehensive picture or account for local variation. > that assumes drivers are able to drive 100% of the time > No, it doesn't. Reread my message. That was my mistake. In my mind I was assuming it would take a car as long to get to me as it would for them to take me where I'm going -- exactly equaling your $30 estimate assuming 0 downtime. Regardless, both the 5min to get to you and 5min of waiting between rides are potential sources of error. Throwing an anecdote into the mix, I've never waited less than 6min for an uber, and I live in a major city. Answering that conclusively needs more data than just the two of us. > it assumes all times of day are equally viable > True. I've ignored surge pricing. And slow periods where drivers wait an hour, late nights where a driver has a higher chance of getting stiffed and needing to clean vomit from their seats, periods just following surge pricing where many drivers have swarmed to an area but the actual available riders have plummeted, and so on. Again, your ballpark numbers might actually be close, but extrapolating a single experience into an entire industry's unit economics is error-prone and IMO irresponsible.
SN76477 6y ago
How much time did the driver invest to get to the point in time that the ride was available? There is a lot of waiting involved with driving for Uber etc.
- AlexTWithBeard 6y ago
  I don't know. My assumption was that their "energy conversion efficiency" was 50%. I guess sometimes it may be less. For airport rides it may be more. Do you have a better estimate?
deleted 6y ago
[deleted]
ideals 6y ago
Gas in Seattle is definitely not $2/gal Also your next ride is probably not on the same block as your last.
- missedthecue 6y ago
  I mean say it's $4/gal or $8/gal even. It doesn't change his point.
- manfredo 6y ago
  It's also tax deductible from the drivers earnings, so it's effectively cheaper.
  - hansvm 6y ago
    If the driver has enough potential deductions for that to be better than the standard deduction (or with that low of income is sufficiently aware of alternative filing options) -- and even then quite a few miles are "effectively" not deducted since you're trading the standard deduction for those.
    - votepaunchy 6y ago
      Business or self employment expenses are subtracted from revenue before computing income, so there is no relation here with itemizing or the standard deduction.
      - hansvm 6y ago
        Yep, I messed up on that one -- forgot uber drivers aren't employees (in which case the standard deduction would ordinarily come into play unless the driver did something more exotic with their taxes). That was my own background slipping through in my answer.

hansvm 6y ago

Assuming a single data point is representative could add a lot of bias, the cost per trip estimate is probably low given that newer nicer cleaner cars are required, that assumes drivers are able to drive 100% of the time, it assumes all times of day are equally viable so that there are enough total hours to turn that into a liveable wage, and it's probably a generous representation of tips and a naive view of fees and incentives outside of when a driver first starts. Your numbers might work out, but studies indicate less income in practice, and there are plenty of potential sources of error in your methodology, so I'd be inclined to believe there's something wrong with that ballpark estimate.

AlexTWithBeard 6y ago
> a single data point is representative Please feel free to add your data. I don't think it will change the estimate dramatically. An airport trip takes about an hour and costs $80, which sums up to similar numbers. > that assumes drivers are able to drive 100% of the time No, it doesn't. Reread my message. > it assumes all times of day are equally viable True. I've ignored surge pricing.
- hansvm 6y ago
  > Please feel free to add your data. I don't think it will change the estimate dramatically. An airport trip for me is usually around $15 and 20min. That's in the same ballpark, but even if we get several people from HN to weigh in that doesn't paint a comprehensive picture or account for local variation. > that assumes drivers are able to drive 100% of the time > No, it doesn't. Reread my message. That was my mistake. In my mind I was assuming it would take a car as long to get to me as it would for them to take me where I'm going -- exactly equaling your $30 estimate assuming 0 downtime. Regardless, both the 5min to get to you and 5min of waiting between rides are potential sources of error. Throwing an anecdote into the mix, I've never waited less than 6min for an uber, and I live in a major city. Answering that conclusively needs more data than just the two of us. > it assumes all times of day are equally viable > True. I've ignored surge pricing. And slow periods where drivers wait an hour, late nights where a driver has a higher chance of getting stiffed and needing to clean vomit from their seats, periods just following surge pricing where many drivers have swarmed to an area but the actual available riders have plummeted, and so on. Again, your ballpark numbers might actually be close, but extrapolating a single experience into an entire industry's unit economics is error-prone and IMO irresponsible.

SN76477 6y ago

How much time did the driver invest to get to the point in time that the ride was available? There is a lot of waiting involved with driving for Uber etc.

AlexTWithBeard 6y ago
I don't know. My assumption was that their "energy conversion efficiency" was 50%. I guess sometimes it may be less. For airport rides it may be more. Do you have a better estimate?

deleted 6y ago

[deleted]

ideals 6y ago

Gas in Seattle is definitely not $2/gal Also your next ride is probably not on the same block as your last.

missedthecue 6y ago
I mean say it's $4/gal or $8/gal even. It doesn't change his point.
manfredo 6y ago
It's also tax deductible from the drivers earnings, so it's effectively cheaper.
- hansvm 6y ago
  If the driver has enough potential deductions for that to be better than the standard deduction (or with that low of income is sufficiently aware of alternative filing options) -- and even then quite a few miles are "effectively" not deducted since you're trading the standard deduction for those.
  - votepaunchy 6y ago
    Business or self employment expenses are subtracted from revenue before computing income, so there is no relation here with itemizing or the standard deduction.
    - hansvm 6y ago
      Yep, I messed up on that one -- forgot uber drivers aren't employees (in which case the standard deduction would ordinarily come into play unless the driver did something more exotic with their taxes). That was my own background slipping through in my answer.