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California is the 5th largest economy in the world. There is no way Uber and Lyft will just leave that market. These are the emptiest of threats. Uber and Lyft

California is the 5th largest economy in the world. There is no way Uber and Lyft will just leave that market. These are the emptiest of threats. Uber and Lyft’s board would absolutely loose their mind if executive leadership decided to just exit, once again, the 5th largest economy in the world

bthrn 6y ago
Keep in mind Uber operates in almost a thousand cities worldwide. Of course certain places will earn Uber more than others, but it’s not a huge hit to their revenue. The real threat, as I see it, is other states enacting similar laws that will have a domino effect.
- Invictus0 6y ago
  Uber does operate in many cities, but its revenue is disproportionately concentrated in California: > “In 2018, we derived 24% of our Ridesharing Gross Bookings from five metropolitan areas — Los Angeles, New York City, and the San Francisco Bay Area in the United States; London in the United Kingdom; and São Paulo in Brazil,” Uber writes in the S-1. “An economic downturn, increased competition, or regulatory obstacles in any of these key metropolitan areas would adversely affect our business, financial condition, and operating results to a much greater degree than would the occurrence of such events in other areas.” [0] https://nymag.com/intelligencer/2019/04/uber-s-1-new-york-city-could-destroy-uber.html https://nymag.com/intelligencer/2019/04/uber-s-1-new-york-ci...
- throwaway1777 6y ago
  It is a huge hit to their revenue. It is not total catastrophe or anything, but as other people pointed out it is significant enough for this to be not as flippant as turning off some other smaller state or country.
wmf 6y ago
Uber and Lyft said they will leave temporarily while they adapt to employing drivers, not permanently.
zelly 6y ago
If they wouldn't make any money with the new law it would be irresponsible to their shareholders for them to stay in California.
- muzz 6y ago
  When California adds a new regulation, businesses often adapt by charging an extra fee. Restaurants in SF did this when the health insurance mandate was initiated. Uber and Lyft could charge a $0.50/ride fee (or whatever the number is), but it seems they don't want to.
  - kmlx 6y ago
    what if it's $10 or $100 per ride?
    - buzzerbetrayed 6y ago
      What if it’s $1,000 or $10,000 per ride? As long as we’re throwing out unreasonable numbers.
      - kinkrtyavimoodh 6y ago
        Except that out of all the numbers thrown around only yours are unreasonable.
- wankerrific 6y ago
  Well they’ll definitely be more profitable if they leave the state. In fact they’d be way more profitable if they shut down all operations everywhere.
muzz 6y ago
Uber and Lyft are behind a proposition that is on the November ballot that will undo AB 5. Stopping service now would leave customers scrambling, but would also give them a strong incentive to vote for that proposition in November. Although I'm sure the companies will say these two things are not connected in any way.
- radu_floricica 6y ago
  Lyft was pretty clear in their announcement that this is the plan.
qppo 6y ago
I'm a bit peeved as a Californian that they had a year to change their model either to onboard their drivers as employees or make them valid contract workers within the law, and chose to screw over their drivers and customers instead.
- dcgudeman 6y ago
  You don’t think they California government shares any of the blame?
  - qppo 6y ago
    I can't say that the law makes their business untenable because the law hasn't been tested yet. If and when the law shows that these new taxi services can't operate as efficiently before for drivers and consumers then I'll put the blame on the government, not the businesses throwing a tantrum over being regulated. I really don't have sympathy for these organizations that have made antagonism a core value.
deleted 6y ago
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bthrn 6y ago

Keep in mind Uber operates in almost a thousand cities worldwide. Of course certain places will earn Uber more than others, but it’s not a huge hit to their revenue. The real threat, as I see it, is other states enacting similar laws that will have a domino effect.

Invictus0 6y ago
Uber does operate in many cities, but its revenue is disproportionately concentrated in California: > “In 2018, we derived 24% of our Ridesharing Gross Bookings from five metropolitan areas — Los Angeles, New York City, and the San Francisco Bay Area in the United States; London in the United Kingdom; and São Paulo in Brazil,” Uber writes in the S-1. “An economic downturn, increased competition, or regulatory obstacles in any of these key metropolitan areas would adversely affect our business, financial condition, and operating results to a much greater degree than would the occurrence of such events in other areas.” [0] https://nymag.com/intelligencer/2019/04/uber-s-1-new-york-city-could-destroy-uber.html https://nymag.com/intelligencer/2019/04/uber-s-1-new-york-ci...
throwaway1777 6y ago
It is a huge hit to their revenue. It is not total catastrophe or anything, but as other people pointed out it is significant enough for this to be not as flippant as turning off some other smaller state or country.

wmf 6y ago

Uber and Lyft said they will leave temporarily while they adapt to employing drivers, not permanently.

zelly 6y ago

If they wouldn't make any money with the new law it would be irresponsible to their shareholders for them to stay in California.

muzz 6y ago
When California adds a new regulation, businesses often adapt by charging an extra fee. Restaurants in SF did this when the health insurance mandate was initiated. Uber and Lyft could charge a $0.50/ride fee (or whatever the number is), but it seems they don't want to.
- kmlx 6y ago
  what if it's $10 or $100 per ride?
  - buzzerbetrayed 6y ago
    What if it’s $1,000 or $10,000 per ride? As long as we’re throwing out unreasonable numbers.
    - kinkrtyavimoodh 6y ago
      Except that out of all the numbers thrown around only yours are unreasonable.
wankerrific 6y ago
Well they’ll definitely be more profitable if they leave the state. In fact they’d be way more profitable if they shut down all operations everywhere.

muzz 6y ago

Uber and Lyft are behind a proposition that is on the November ballot that will undo AB 5. Stopping service now would leave customers scrambling, but would also give them a strong incentive to vote for that proposition in November. Although I'm sure the companies will say these two things are not connected in any way.

radu_floricica 6y ago
Lyft was pretty clear in their announcement that this is the plan.

qppo 6y ago

I'm a bit peeved as a Californian that they had a year to change their model either to onboard their drivers as employees or make them valid contract workers within the law, and chose to screw over their drivers and customers instead.

dcgudeman 6y ago
You don’t think they California government shares any of the blame?
- qppo 6y ago
  I can't say that the law makes their business untenable because the law hasn't been tested yet. If and when the law shows that these new taxi services can't operate as efficiently before for drivers and consumers then I'll put the blame on the government, not the businesses throwing a tantrum over being regulated. I really don't have sympathy for these organizations that have made antagonism a core value.

deleted 6y ago

[deleted]