5 ms·

For Uber and Lyft, the Rideshare Bubble Bursts

16 points by aarghh 5y ago

paulpauper 5y ago
lol Uber stock at $48, still well above the IPO. Journalists have been calling for the demise of Uber forever. They need to find a new hobby. Forecasting is not for them.
- skinnymuch 5y ago
  Look at Doordash’s stock. It’s remarkably close in market cap to Uber. Right now it’s around 3/4.
- smt88 5y ago
  > Forecasting is not for them. If you'd read the article, you'd know it was a review of all the forecasts made by Uber and Lyft. The journalist didn't forecast anything. So I guess your comment should say: Uber and Lyft need to find a new hobby. Forecasting is not for them.
- nuerow 5y ago
  > lol Uber stock at $48, still well above the IPO. Journalists have been calling for the demise of Uber forever. They need to find a new hobby. Forecasting is not for them. The article mentions that so far Uber has burned through over $20 billion since 2009 and still hasn't turned a profit. The article also points out that Uber and Lyft's own projections didn't showed a profit this year. Unless you expect a company to be perpetually kept afloat by generous millionaire investment rounds, either the cash flow adds up or the current trajectory points to bankruptcy.
bko 5y ago
> Piece by piece, the mythology around ridesharing is falling apart. Uber and Lyft promised ubiquitous self-driving cars by as soon as this year. They promised an end to private car ownership. They promised to reduce congestion in the largest cities. They promised consistently affordable rides. They promised to boost public transit use. They promised profitable business models. They promised a surfeit of well-paying jobs. Heck, they even promised flying cars. What other company needs to justify its existence this much besides "our customers find us useful"? I know Uber and Lyft has made my life better, otherwise I wouldn't have used them. I imagine the same is true for the millions that have used their product. Let's be honest what attacks on ride sharing is about. It's the remnants of grievances regional taxi companies had over facing competition. And it was strangely picked up by large newspapers. I'm old enough to remember taxi cartels pre-Uber. I remember being unable to find a taxi in a bad neighborhood, or going to a less populated area or when its raining. I remember the inefficient routes, the dangerous unaccountable driving, the "broken" credit card machines. Others remember not being able to get a cab because their skin is the wrong color or not being able to drive a cab without renting out a medallion from a medallion hoarder or having to take a second mortgage out on their house to afford a medallion. Taxis existed since the invent of cars. I don't see why an app to book taxi rides should draw such scrutiny.
- apahwa 5y ago
  they don't need to justify there existence, they need to justify their market cap. they attained that market cap via the dreams outlined in your article quote - it is reasonable to then question the value of the stock. all companies have to justify their value - some have less clear justifications and that means more discussion. this isn't the conspiracy you make it out to be.
  - coralreef 5y ago
    Technically they don't need to justify their market cap, the market assigns their value for them by trading their stock. There's no need to "argue" a companies value, you speak best by shorting/longing.
  - dartharva 5y ago
    >they need to justify their market cap Why? It's market forces controlling the price, they aren't driving the hands of players.
- smt88 5y ago
  You seem to have completely glossed over the part where they promised to be a viable business with actual profits.
  - bko 5y ago
    They're viable in a lot of cities, at least pre-pandemic. They could likely just dump all non-profitable cities and be in the green very soon. They just spent a lot of money getting a foothold in future markets. You know... investing... like a business is supposed to do
    - smt88 5y ago
      There is no evidence that they're profitable in any single city. Notably, the companies themselves haven't even tried to claim this. When they've said they're profitable in any city, they're ignoring major administrative overhead. "Drive me somewhere" is not a brandable business. It's a commodity. It's a race to the bottom on both sides of the market (drivers and passengers) which is why it has never been a profitable business without the reduced competition of a medallion system.
mikysco 5y ago
Ride sharing’s empty promises can be chalked up to corporate PR… I don’t imagine most riders or investors consider those when calling a car or investing. Wrt the measurable externalities (traffic, pollution, etc) - don’t these exist due to the stronger data capture (app based) and public scrutiny? I have a difficult time believing Uber/Lyft are worse on these metrics relative to traditional taxis
- nuerow 5y ago
  > Ride sharing’s empty promises can be chalked up to corporate PR… I don’t imagine most riders or investors consider those when calling a car or investing. I disagree. Ridesharing promised sharing a car. That is the whole concept: anyone with a car could pick up passengers and be rewarded by it. See also carpooling. This is not what Uber or Lyft do, because that business was regulated out of existence by the taxicab lobby. We're talking about an established monopoly which fought any ride hailing service that was presenting any competition to their business. What Uber and Lyft ended up getting away with was ride hailing services. They got away with it by leveraging existing legislation on vehicle rentals with their own driver. Still, that business is only available to licensed companies, not the regular public. Getting back to ridesharing, the underlying thesis and the main value proposition of carsharing is that the service provided a way for everyone with a car to monetize their ride by picking up a passenger in exchange for a small fee. Instead of going through your commute with your car empty, you could pick a passenger willing to pay you for your trouble. That would take cars from the street, lessen traffic congestions, and change the way public transportation was used.
yuppie_scum 5y ago
We are not going back to shitty old medallion cans. Ever.
neonate 5y ago
https://archive.is/cOT1A https://archive.is/cOT1A

16 points by aarghh 5y ago

lol Uber stock at $48, still well above the IPO. Journalists have been calling for the demise of Uber forever. They need to find a new hobby. Forecasting is not for them.

skinnymuch 5y ago
Look at Doordash’s stock. It’s remarkably close in market cap to Uber. Right now it’s around 3/4.
smt88 5y ago
> Forecasting is not for them. If you'd read the article, you'd know it was a review of all the forecasts made by Uber and Lyft. The journalist didn't forecast anything. So I guess your comment should say: Uber and Lyft need to find a new hobby. Forecasting is not for them.
nuerow 5y ago
> lol Uber stock at $48, still well above the IPO. Journalists have been calling for the demise of Uber forever. They need to find a new hobby. Forecasting is not for them. The article mentions that so far Uber has burned through over $20 billion since 2009 and still hasn't turned a profit. The article also points out that Uber and Lyft's own projections didn't showed a profit this year. Unless you expect a company to be perpetually kept afloat by generous millionaire investment rounds, either the cash flow adds up or the current trajectory points to bankruptcy.

bko 5y ago

> Piece by piece, the mythology around ridesharing is falling apart. Uber and Lyft promised ubiquitous self-driving cars by as soon as this year. They promised an end to private car ownership. They promised to reduce congestion in the largest cities. They promised consistently affordable rides. They promised to boost public transit use. They promised profitable business models. They promised a surfeit of well-paying jobs. Heck, they even promised flying cars. What other company needs to justify its existence this much besides "our customers find us useful"? I know Uber and Lyft has made my life better, otherwise I wouldn't have used them. I imagine the same is true for the millions that have used their product. Let's be honest what attacks on ride sharing is about. It's the remnants of grievances regional taxi companies had over facing competition. And it was strangely picked up by large newspapers. I'm old enough to remember taxi cartels pre-Uber. I remember being unable to find a taxi in a bad neighborhood, or going to a less populated area or when its raining. I remember the inefficient routes, the dangerous unaccountable driving, the "broken" credit card machines. Others remember not being able to get a cab because their skin is the wrong color or not being able to drive a cab without renting out a medallion from a medallion hoarder or having to take a second mortgage out on their house to afford a medallion. Taxis existed since the invent of cars. I don't see why an app to book taxi rides should draw such scrutiny.

apahwa 5y ago
they don't need to justify there existence, they need to justify their market cap. they attained that market cap via the dreams outlined in your article quote - it is reasonable to then question the value of the stock. all companies have to justify their value - some have less clear justifications and that means more discussion. this isn't the conspiracy you make it out to be.
- coralreef 5y ago
  Technically they don't need to justify their market cap, the market assigns their value for them by trading their stock. There's no need to "argue" a companies value, you speak best by shorting/longing.
- dartharva 5y ago
  >they need to justify their market cap Why? It's market forces controlling the price, they aren't driving the hands of players.
smt88 5y ago
You seem to have completely glossed over the part where they promised to be a viable business with actual profits.
- bko 5y ago
  They're viable in a lot of cities, at least pre-pandemic. They could likely just dump all non-profitable cities and be in the green very soon. They just spent a lot of money getting a foothold in future markets. You know... investing... like a business is supposed to do
  - smt88 5y ago
    There is no evidence that they're profitable in any single city. Notably, the companies themselves haven't even tried to claim this. When they've said they're profitable in any city, they're ignoring major administrative overhead. "Drive me somewhere" is not a brandable business. It's a commodity. It's a race to the bottom on both sides of the market (drivers and passengers) which is why it has never been a profitable business without the reduced competition of a medallion system.

mikysco 5y ago

Ride sharing’s empty promises can be chalked up to corporate PR… I don’t imagine most riders or investors consider those when calling a car or investing. Wrt the measurable externalities (traffic, pollution, etc) - don’t these exist due to the stronger data capture (app based) and public scrutiny? I have a difficult time believing Uber/Lyft are worse on these metrics relative to traditional taxis

nuerow 5y ago
> Ride sharing’s empty promises can be chalked up to corporate PR… I don’t imagine most riders or investors consider those when calling a car or investing. I disagree. Ridesharing promised sharing a car. That is the whole concept: anyone with a car could pick up passengers and be rewarded by it. See also carpooling. This is not what Uber or Lyft do, because that business was regulated out of existence by the taxicab lobby. We're talking about an established monopoly which fought any ride hailing service that was presenting any competition to their business. What Uber and Lyft ended up getting away with was ride hailing services. They got away with it by leveraging existing legislation on vehicle rentals with their own driver. Still, that business is only available to licensed companies, not the regular public. Getting back to ridesharing, the underlying thesis and the main value proposition of carsharing is that the service provided a way for everyone with a car to monetize their ride by picking up a passenger in exchange for a small fee. Instead of going through your commute with your car empty, you could pick a passenger willing to pay you for your trouble. That would take cars from the street, lessen traffic congestions, and change the way public transportation was used.

yuppie_scum 5y ago

We are not going back to shitty old medallion cans. Ever.

neonate 5y ago

https://archive.is/cOT1A https://archive.is/cOT1A