Posted on 06/25/2016 5:52:59 AM PDT by logi_cal869
Uber is coming under increased scrutiny after leaked documents indicated their drivers really don’t make all that much money.
“I’ve been saying this for a while, it’s an Uber disappointment,” explained driver Kelsey Tilander
(Excerpt) Read more at sanfrancisco.cbslocal.com ...
If your friend cleared $300/day, that's roughly $75k/yr. Work 5 days a week, 50 weeks (weekends off, 2 wk vacation). I don't think they are making that much.
There is a former cabbie here on FR - interested in his opinion on this.
It could be that Uber is laden with “amateurs” who don’t know how to price their service correctly.
Even if you do, you are in competition with those who don’t, so those who don’t always get the fares.
A taxi company can stay in business if its price is right. If too low, it’s out of business. Business overhead like accounting, garage work, etc., can be amortized over multiple vehicles full time. I doubt an individual, doing their own time for their own accounting etc, can get a better “overhead rate” for that part of the business.
So if Uber is cheaper than taxis, it tells you they are probably not priced right. The company Uber is probably doing fine.
So good for a bit of extra cash in your pocket once and awhile (especially if you don’t pay tax on it) but probably not worth it as a full time gig.
Sort of like how a time share is not a good real estate investment, though it does work spectacularly well for the builder and property managers.
Most have been driving for Uber for a few months or a year. No more than that but it's a relatively new service so that makes sense. Most also say they love doing it. None have said they don't like it though there are some things they will sometimes say they don't care for. Some like shorter rides and they don't like when they take a long one, for example. But overall they love it. Are they fibbing? Who can say. But that's what they tell me.
Ping
Uber is an attempt to turn individuals into small businessmen with a minimum of overhead and expenses.
Can’t work. Using the car for business purposes, will invite higher premiums from the insurance company. The increased mileage means wear and tear on the car. Some localities will consider the car as belonging to the business, and tax it as business property. You pay for your own gas and repairs. Uber doesn’t.
This business model will have to be changed. Uber is not going away.
I think this is true for all Uber drivers, if they account for their explicit costs (gasoline, maintenance) and hidden costs (depreciation on the vehicle).
The "black car" drivers get a much higher rate, but unless they get regular bookings, it doesn't help. And, it may also depend on the area, and the policies.
For instance, I live on the fringe of a large metro area. Uber only matches a customer with drivers within about 10 minutes away, and regular Uber drivers are rarely within that distance. But, Uber will instead offer "black car" service that is 15-20 minutes away. The price is about double the "select" rate, and about 3 times the "regular" rate, so we don't use it. However, the "black car" driver also has to drive further to pick up a paying passenger and eat that cost.
If your friend cleared $300/day, that's roughly $75k/yr. Work 5 days a week, 50 weeks (weekends off, 2 wk vacation). I don't think they are making that much.
He doesn't make $300 every day. But even if he did, that's $75K gross. It doesn't account for his cost of maintenance and depreciation.
So I’m supposed to put my trust in an amateur hack, do I know he’s properly insured? Does his insurance company know he’s carrying passengers for hire? Does he have a chauffer’s license? how’s his car maintained? Good luck with that. A least a legit taxi service is likely to have deep pockets insurance. Uber driver, not so much.
Uber drivers don't set their prices. Uber sets the price, and collects a fee.
The price varies based on the level of service (basically, nicer/larger cars get better rates). During periods of high demand in an area, Uber boosts the price (it's called "surge") to attract more drivers to the area to meet the demand.
Did a return for an Uber driver and showed the client s/he was losing 25 cents for each mile she drove. No pay for the return leg was a contributing factor. Either you luck out and get another fare taking you back towards home after you do the drop off or you eat it. And good luck if that fare takes you even further away.
Three years of losses and you have a hobby, not a business.
I will also note that not many Uber drivers seem to be carrying the proper insurance. Good luck if your insurance company finds out you are driving for hire. Supposedly Uber is supposed to be working out some sort of hybrid coverage.
I also wonder what happens if you live close to a state border and your trips cross the line (npi).
Uber insures the driver while he/she is carrying a passenger.
Does he have a chauffer’s license?
Driver's for the "black car" fare are licensed livery drivers.
how’s his car maintained?
Uber passengers are asked to rate the driver and car at the end of a ride. If a driver's rating drops below a certain level, Uber will drop them.
Thanks, good to know.
This is what I've suspected, and have posted above: I don't think most Uber drivers are accounting for all of their costs.
Gas and maintenance can be tracked, but depreciation due to excessive mileage is harder. I'd make it simple and just reduce the payment from Uber by the number of miles driven * 54 cents (the IRS mileage rate for 2016).
Supposedly Uber is supposed to be working out some sort of hybrid coverage.
Uber has an insurance policy that covers the driver while transporting a passenger. I don't know all of the details, like coverage while enroute to pick up a passenger.
Sorry, but neither of those things are Uber’s responsibility.
there are also bonus dollars at different times....like extra $50 after making 30 rides a week.
also the "surge" rates when there are more clients than drivers....could be X1.2,... X2.0...and up.
An investor in Uber?
Of course it’s not their responsibility - they take responsibility for nothing - even when one of their drivers turns out to be a criminal. At least New York City cabbies are vetted.
One thing not mentioned is that Uber likes new drivers and gives them all the work while longer term drivers languish in diners and empty parking lots waiting for the next call. The Uber forums are amazing fonts of info!
It’s possible drivers are reluctant to tell passengers the truth. Although I’m sure some drivers actually like the work. But since driver and passenger review each other, as a driver I’d be reluctant to tell someone I hated my job! I certainly never told the truth when I worked in retail at the same time my husband was driving for Uber. Of course, there were aspects of my job that I really enjoyed...
Well then....that's the first driver mistake.
When you drop off a passenger....just wait nearby....the UBER app will search a radius about 5 to 10 miles out for another ride.
Most likely get another ride nearby...especially in a city
No, not an investor. Am I allowed to have an opinion without having any skin in the game?
I decided not to do it after crunching the numbers and realizing that I would be making $10 per hour.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.