posted by dfwgator
Posted on 09/12/2019 3:09:08 AM PDT by C19fan
arguing that drivers aren’t core to its ride-share business model
Huh?
Here’s how this really ought to be settled: The Market.
Drivers either agree to drive, or they don’t.
If enough of them don’t, Uber will have to rethink their business model.
Wow. I remember all the years of Amazon and Google losing money hand-over-fist, but when does Uber become profitable??? Amazon had only captured a tiny portion of teh market they had envisioned (books) when they saw profitability on the horizon. What, is Uber going to replace ALL drivers or something? Seems like they could completely kill off taxis and still lose money hands over fist. Or are their expenses mostly programming?
He is saying that Uber is a Digital Platform meet-up space that independent drivers and independent riders use to facilitate an agreed service.
So, it's no surprise that commies don't like it.
Now, explain why so many "conservative" Freepers don't.
I agree. Uber and Lyft should ditch California. There are so many millennials in their ultra liberal cities that use Uber as their main form of transportation that they may end up tossing their politicians on their asses.
Are the independent drivers able to set their own rates?
They can drive at the negotiated rate, or not drive.
They are NOT employees. They are independent contractors and are doing the same type of thing independent contractors have been doing for decades. California just wants to milk Uber AND its drivers for more tax revenue.
Those guys set their own hours, and their own pay.
Pay is always an agreement between buyer and seller. Even if it is negotiated by a third-party (in this case, Uber).
Until the government steps in.
...and those here on FR that agree with it.
Astonishing, isn't it?
It is not just ride sharing companies, the law covers a wide variety of independent contractors.
I wonder if this rule will also apply to Real Estate companies. All of the brokerage treat their agents as independent contractors as well.
Then it makes no sense to have them compensated with benefits as full-time employees. No business could afford that. I absolutely agree with the comment about the egregious overreach of the California legislature.
From the article I linked:
The company says a majority of 2Q losses are a result of stock-based compensation expenses for employees following its May IPO. Stock compensation aside, Uber still lost $1.3 billion, up 30% from Q1.
Uber's expenses are all back-end hardware and software to facilitate the driver and user apps, and credit card/Paypal financial transactions.
They (Uber) also cover the driver and driver's car with insurance while 'on the clock.' That can't be cheap. Most car insurance excludes commercial use, so someone driving for Uber would invalidate their own insurance for that time period. So it makes sense that Uber needs to provide coverage.
Well, back-end hardware expenses will always grow with the company, and any company that thinks, “Well, once we get our software projects complete, we can proportionally reduce our computer engineering budget” would have to no ZERO about information systems.
Many people today are 1099 contract workers, even sales people...California can kiss their business engine goodbye.
Do independent truck operators set their own pay?
To be fair, except for some scaling issues, basically the back end computing is a fixed cost regardless of the number of transactions per time period. So if you can spread that fixed cost among more transactions, the cost per transaction decreases. Uber could grow its way out of that cost.
Financial transactions (such as credit card merchant fees) are a variable cost, and increase with the number of transactions. So that cost per transaction is the same regardless of the number of transactions. If you're losing money on variable costs, you can't grow yourself out of that problem.
Insurance is a variable cost. The more driver hours on the road, the higher the insurance costs. You can't grow yourself out of those costs, either.
So without knowing Uber's fixed and variable costs per transaction, there is no way to know if Uber will ever be in the black.
In a way, yes. Sometimes shippers will put out a load request, and independent truck operators bid on how much they will take for the load, lowest bid wins.
posted by dfwgator
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