5 ms·

Drivers say they are getting paid pennies, and riders are saying Uber is way too expensive now. What the hell is happening?

tyree731 5y ago
The model has never been economically sustainable, and it only thrived due to subsidies from venture capital.
- AlexandrB 5y ago
  Yup. The worst part is that Uber/Lyft can selectively keep subsidizing rides in markets where there's still competition from legacy taxis while charging what they want in less competitive markets. Notice from this article that Uber and Lyft are seemingly acting in concert when cutting pay and offering subsidies. This is either both companies responding to the market in similar ways or cartel behavior. Good luck proving the latter in court however.
- antisthenes 5y ago
  And subsidies from the drivers themselves, many of whom are running their vehicles into the ground, not accounting for the depreciation. The only winners here are large Uber shareholders who got in early at low valuations.
- treis 5y ago
  We've had taxis for 100 years. It's obviously a sustainable business.
  - lotsofpulp 5y ago
    We’ve had terrible, smoke smelling, old taxis serving small areas compared to today, that may or may not show up if you lived a little out of the way. I suspect many people can’t afford the level of service that Uber/Lyft have gotten them accustomed to over the past decade. A possible solution would be to let drivers bid on trips proposed by passengers.
    - thrixton 5y ago
      I like this idea. The anecdotal evidence from LAX above points to it already happening in an unsupported manner. If it was supported in the app and all drivers / passengers had visibility it would be a very clear market indicator for both the drivers and passengers. Cartel behaviour could be problematic though.
dmitrygr 5y ago
Shareholders getting paid?
ChicagoDave 5y ago
Maybe driving Uber in LA is just not economically viable because of traffic. Chicago is going through a boom in rates because there are so few drivers.
favorited 5y ago
Uber isn't, and has never been, profitable.
deleted 5y ago
[deleted]
Apocryphon 5y ago
Isn't it simply because COVID is preventing the cheap shared rides from being available?

tyree731 5y ago

The model has never been economically sustainable, and it only thrived due to subsidies from venture capital.

AlexandrB 5y ago
Yup. The worst part is that Uber/Lyft can selectively keep subsidizing rides in markets where there's still competition from legacy taxis while charging what they want in less competitive markets. Notice from this article that Uber and Lyft are seemingly acting in concert when cutting pay and offering subsidies. This is either both companies responding to the market in similar ways or cartel behavior. Good luck proving the latter in court however.
antisthenes 5y ago
And subsidies from the drivers themselves, many of whom are running their vehicles into the ground, not accounting for the depreciation. The only winners here are large Uber shareholders who got in early at low valuations.
treis 5y ago
We've had taxis for 100 years. It's obviously a sustainable business.
- lotsofpulp 5y ago
  We’ve had terrible, smoke smelling, old taxis serving small areas compared to today, that may or may not show up if you lived a little out of the way. I suspect many people can’t afford the level of service that Uber/Lyft have gotten them accustomed to over the past decade. A possible solution would be to let drivers bid on trips proposed by passengers.
  - thrixton 5y ago
    I like this idea. The anecdotal evidence from LAX above points to it already happening in an unsupported manner. If it was supported in the app and all drivers / passengers had visibility it would be a very clear market indicator for both the drivers and passengers. Cartel behaviour could be problematic though.

dmitrygr 5y ago

Shareholders getting paid?

ChicagoDave 5y ago

Maybe driving Uber in LA is just not economically viable because of traffic. Chicago is going through a boom in rates because there are so few drivers.

favorited 5y ago

Uber isn't, and has never been, profitable.

deleted 5y ago

[deleted]

Apocryphon 5y ago

Isn't it simply because COVID is preventing the cheap shared rides from being available?