Despite Opponents' Attacks, Uber is Just What Americans Need

Townhall.com ^ | December 2, 2015 | Danni Ondraskova

[bigdaddy45]

Let me guess — you’ve never used Uber.

[Alberta's Child]

Uber is going to look much different in five years than it is today. The company was built on loopholes in laws, regulations and insurance policies, and as these loopholes get closed the whole business model becomes less competitive. Look at what happened in New York City after Uber signed up with the city government to meet all of the city's requirements for commercial passenger services. For a fixed-price route from one of the city's airports, Uber actually costs more than a New York City taxi cab.

Companies are seeing customers go more and more to ecommerce, and they are figuring out how to deliver orders faster and faster. Why not use Uber drivers? You order something from the Target website, and 30 minutes later its delivered by Uber. UPS and Fedex can’t do that.

That's exactly my point about the cheap labor. How much is anyone going to be willing to pay for a 30-minute delivery time that would otherwise cost about $15 through UPS or FedEx for the next day? Unlike personal transportation, there are economies of scale in transporting cargo that make a 30-minute delivery in the trunk of a personal automobile completely impractical in most cases. Under these circumstances, the Uber driver who thinks he's making a decent bit of cash is always going to be undercut by some Mexican who is willing to do the same job in his 1987 Oldsmobile.

[Alberta's Child]

But Uber aims to be much more than a glorified cab company.

This is true. I think Uber's real interest is in selling their app to small and mid-sized commercial establishments that operate fleets of vehicles for passenger or cargo service. I'm sure they know better than anyone else that gypsy cabs are not a good growth industry.