# Don't fool yourself about making money



## raygam (Jan 4, 2016)

I have been reading a bunch of posts here, about the good money some are making or
the bad/no money some are making and so on and so forth. To be honest I am simply
amazed at how new drivers (I am guessing they must be new) are calculating things.

As a background, I drive black car in NYC and occasionally, if things are really slow,
I will turn on the Uber app. I do the minimum number of trips to remain on their system.
However, their pay scale is simply not viable for me. I will explain why and everyone
reading can draw their own conclusions. Some things posted here are way off reality so I
shall comment on them as well.


Someone said their car is paid for so their cost is really low. Please be serious! 
The car costs you money whether you are making monthly payments or not. It will, someday
soon, need to be replaced so there is a definite cost involved. Ignore it at your own risk.
.
Someone stated that they don't spend a lot of money because they are using their own 
presonal insurance coverage, no expensive commercial insurance. This is fine as long as 
nothing happens! If you get into an accident and your insurance company finds out you 
were using the car for commercial purposes (e.g making money, for hire, etc.) they simply 
will not pay the claim. Even worse, if a passenger files a claim against you the 
insurance company will not pay and they will also drop you. This is not state or city 
specific. This is the insurance business. Look into it.
.
Last but not least the rates. I have read all kinds of reasoning about rates and miles 
and such. Those of you doing it wrong - stop listening to Uber's way of computing things!
Your expenses (cost) are based on MILES DRIVEN not miles you are paid for! The NYC rate is quite
a bit better than some other cities I read about yet.. I did a small experiment so you can 
see it.
.
As you may agree, the IRS is NOT a charitable institution. Their purpose is not
to increase your deductions but to collect taxes. For the tax year of 2015 the IRS allows 
one to deduct $0.575 (or 57.5 cents) for each mile driven. This allowance, according to the 
IRS, covers the cost of the car, including repairs, tires, gas, etc. Now, I don't know about 
you but I somehow don't think the IRS is overestimating the cost. If anything the opposite.
But we'll use this number as the "cost", okay?
.
I took my car out for a short time to do Uber work. From the time I left my house 
till I returned and parked again I drove exactly 30.5 miles. I did not do any pleasure driving, 
only a little bit of work. I had to drive to NYC where most of the work is and back home, 
of course. And, yes, this costs money! According to the IRS my little outing cost me $17.54
(30.5 miles times the IRS allowance)
.
My Uber take home for the trips I completed was $20.94 which gives me a positive gain of 
$3.40 - not much to write home about. 
.
Consider the time it took to get to NYC, complete the trips and come back. Add to that a 
little time for servicing the car (washing, oil change, repairs all take my time and, as they say, 
time is money). If we assume that the total time invested was only 30 minutes (it was longer!) 
that suggests that my hourly take-home pay, *before taxes* would be $6.80 / hr - well below 
minimum wage I could get flipping burgers for McDonald's.
.
The above is a rough calculation. Your real numbers, after considering time invested, 
money invested, complete cost of the vehicle (including purchase, interest, repairs, 
washes, etc) might just make the numbers worse.
*.*
To add insult to injury, in NY sales tax is collected on car fares - 8.75% of the fare to 
be accurate. Do you know who pays that tax? No, not the passenger or Uber - the driver! If
I go to buy something in a store and the item has a price tag of, say, $100, the store will add 
$8.75 to it for the state and my cost is $108.75. Probably something like it where you are 
reading, right? Let me see now...
.
Uber computes their commission on the fare. So, if the fare was, say, $100 (yeah,
I know, a really good trip, right?) Uber would get $25 of that (if your commission was 25%).
.
The state will expect to get $8.75 in NYC computed on the $100 price or the fare.
.
BUT the passenger pays only $100! The NY driver will only get $66.25 (which is the $100 less the $25 for Uber less the $8.75 for the state) - in other words the total deductions are now 33.75% instead of the 25%. Thank you Uber! I have to pay you a commission on the sales tax. Why?


Unfortunately, this only scratches the surface. This is not a business for the driver. To
everyone who thinks they take home decent money - good luck. You are generating cash flow,
not profits. Cash flow is great until the costs catch up - and they will.

Off the soap box....


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## Bill Collector (Dec 17, 2015)

Damn that was pretty depressing... And spot on.... If someone still thinks they are making tonnes of money Ubering, wake up!


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## rtaatl (Jul 3, 2014)

Amen....real talk. I'll wait for our Uber cheerleaders to spin this somehow. It will be a good laugh.


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## raygam (Jan 4, 2016)

Bill Collector said:


> Damn that was pretty depressing... And spot on.... If someone still thinks they are making tonnes of money Ubering, wake up!





rtaatl said:


> Amen....real talk. I'll wait for our Uber cheerleaders to spin this somehow. It will be a good laugh.


Well, Uber tells us that generating more work, albeit at a lower price, will yield more income by reducing our idle time.

While in and of itself this statement MAY be accurate it is conveniently omitting facts, after all, Uber spins the story as good politician would.

Idle time means I can stop and turn off my engine (no wear and tear on the car, engine, tires, etc.) This is often typical in the black car business while awaiting a job. But, as I posted originally, there is a *cost involved in miles driven*. So, Uber will reduce the price (income) but does not reduce the expense (cost per mile driven).

What does Uber think will happen?

On a side-note there was *an interesting article* you may wish to read in today's ThinkProgress.


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## UberEddie2015 (Nov 2, 2015)

Great post amd I have been posting the same for a while. But you have Uber cheerleaders , the rah rah boys and girls telling us depreciation doesn't matter because they don't plan on selling their vehicle. Most don't even know their cpm or say it is some where around .10 cpm which we all know is crazy. But for the desperate and uneducated cash flow is all that matters until that big expense bites you.


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## bobby747 (Dec 29, 2015)

great so true post ray thank you. truth........company is bad news imo. as an x driver if you refuse a call. the computer will give you 1 , 1.5 miles away to a customer who wants to go 1 mile. happens alot so predictile. they punish you alot . with thier so smart computers. i got 5000 too many rides last year...yep 5000. they are very slick and slime like


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## raygam (Jan 4, 2016)

UberEddie2015 said:


> Great post amd I have been posting the same for a while. But you have Uber cheerleaders , the rah rah boys and girls telling us depreciation doesn't matter because they don't plan on selling their vehicle. Most don't even know their cpm or say it is some where around .10 cpm which we all know is crazy. But for the desperate and uneducated cash flow is all that matters until that big expense bites you.


I suspect that many who drive for Uber are not professional drivers nor do they want to be. They may have selected this "job" because it seemed easy - no application, no interview, no boss, no real rules, no hours, quick cash - and are, in reality, using the job as a cash machine. That works fine for a while but eventually things begin to catch up and cash-flow will dry up with the expenses. Yes, you are correct - cash-flow is king for many. 

As for the fanboys - who cares. I'm quite sure Uber staff is also monitoring these forums/threads (why not, they have the $ to do so) and some may chime in from time to time. The Uber "spin", not unlike a political spin, will sound great till one begins to look into it deeper and begins to check facts.

Although nobody has yet claimed that I am posting bad info or untruths, to those who wish to make such claims I say "I've been called worse by better".


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## bobby747 (Dec 29, 2015)

Well I am 100 % pro Driver 25 plus years driving in pa . They are lucky to have a guy like me. Who treats customers so well. Many guys stop me from .n.j and say you are a Uber . What side is 29th street train station on. On course they read it so what. If a customer makes a flase accusation against you deactivate you. I just do my job.


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## UberBlackPr1nce (Dec 28, 2014)

raygam said:


> I have been reading a bunch of posts here, about the good money some are making or
> the bad/no money some are making and so on and so forth. To be honest I am simply
> amazed at how new drivers (I am guessing they must be new) are calculating things.
> 
> ...


My compadres NuberUber Cogburn would find this to be valuable information. They didn't do their research....


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## raygam (Jan 4, 2016)

bobby747 said:


> great so true post ray thank you. truth........company is bad news imo. as an x driver if you refuse a call. the computer will give you 1 , 1.5 miles away to a customer who wants to go 1 mile. happens alot so predictile. they punish you alot . with thier so smart computers. i got 5000 too many rides last year...yep 5000. they are very slick and slime like


I don't do enough Uber work now to be familiar with all their recent tactics.

I did more last year till I did quarterly profit & loss reports (yes, people, I do my own accounting) and saw the numbers turning out real poor, as suspected.

I guess many Uber drivers pretend this job is a cash machine (I like that analogy) at least till it runs out of money.


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## Bill Collector (Dec 17, 2015)

I think I am in UBER's naughty list lately... Gotten requests from 1* pax back to back.... How can someone have that low of a score! I ain't taking risk to figure out!


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## tomabq (Jan 14, 2015)

raygam said:


> I have been reading a bunch of posts here, about the good money some are making or
> the bad/no money some are making and so on and so forth. To be honest I am simply
> amazed at how new drivers (I am guessing they must be new) are calculating things.
> 
> ...


Get back up on that soap box buddy! Keep shouting it out till the sheeple U N D E R S T A N D! Uber is ripping every driver off big time. I refuse to pay a tax that uber never collects! Besides this we do not have tax id# you must drive for another company.

Anyway ubers first priority is to be the lowest cost company no matter who they screw in the process. This is what made wally world a household name and is straight out of their playbook!


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## raygam (Jan 4, 2016)

UberBlackPr1nce said:


> My compadres NuberUber Cogburn would find this to be valuable information. They didn't do their research....


Don't know them but I'd bet they have lots of company if they didn't do their research.. Such is life.


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## raygam (Jan 4, 2016)

tomabq said:


> Get back up on that soap box buddy! Keep shouting it out till the sheeple U N D E R S T A N D! Uber is ripping every driver off big time. I refuse to pay a tax that uber never collects! Besides this we do not have tax id# you must drive for another company.
> 
> Anyway ubers first priority is to be the lowest cost company no matter who they screw in the process. This is what made wally world a household name and is straight out of their playbook!


I cannot be responsible for sales tax according to NY State law for the simple reason that I do not have control of the money. Uber bills the customer and collects the money. I don't even know the customer except for a first name. So the tax isn't my problem.

Yes, Uber is concentrating on the market. Note that they are not going after Lyft but rather the more established yellow (or whatever color} taxi industry. They are determined to bring it down. In NYC a taxi medallion was going for about a million bucks. One was basically getting a mortgage. Medallion prices are now down to about $750k. Lots of medallion owners owe more now than they can sell for. Can we spell negative equity?

And, if some are wondering just why Uber is leaving Lyft alone.. Because they must have some "competition" (or at least the appearance of it) so they do not get nailed for a monopoly. Lyft isn't much of a threat to Uber now but they are Uber's anti-monopoly safety net.


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## tomabq (Jan 14, 2015)

raygam said:


> Well, Uber tells us that generating more work, albeit at a lower price, will yield more income by reducing our idle time.
> 
> While in and of itself this statement MAY be accurate it is conveniently omitting facts, after all, Uber spins the story as good politician would.
> 
> ...


Uber tells us it will produce more fares during our idle time. What they fail to tell you is the market is so saturated that they are saving us from going to1 ride every hour to 1 ride every 2 hrs. The buisness picks up for them not us. They also don't mention the amount of new drivers coming on. They know they have plenty of 25 percenters to replace the 20 percenters. It's a win win for uber.


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## oobaah (Oct 6, 2015)

raygam said:


> And, if some are wondering just why Uber is leaving Lyft alone.. *Because they must have some "competition" (or at least the appearance of it) so they do not get nailed for a monopoly*. Lyft isn't much of a threat to Uber now but they are Uber's anti-monopoly safety net.


I said Uber needs Lyft alive due to "Anti-Trust Laws" to some guys that we meet with every now and then...

all I got was blank stares...lol


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## Dontmakemepullauonyou (Oct 13, 2015)

raygam said:


> I have been reading a bunch of posts here, about the good money some are making or
> the bad/no money some are making and so on and so forth. To be honest I am simply
> amazed at how new drivers (I am guessing they must be new) are calculating things.
> 
> ...


Uber hates people like you, you know people that finished 3rd grade math.

The thing is, lots of people doing uber are losers and their time is not valuable to them.

To me if I don't make $15+ per hour after expenses, I am doing something wrong and I'd rather sit on the couch smoking kush. To others they don't have anything to do with their life so every hour they aren't expecting any money so if they make $3-9 an hour they are happy because maybe they have a hobby like collecting Star Wars toys so any money they make its more valuable to them.

And this is exactly the type of person uber wants, they want you to work 10 hours and after gas they want you left with so little money that you only have enough to fill the tank again and uber on.


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## TheHairyFiddler (Jan 12, 2016)

Ride sharing companies should have minimum fare requirements. Contact legislators and explain to them the basic economics of Uber and their vulture capitalism tactics. If pax don't want to pay $1.20 per mile for service then fine. They can pay $1.50 per mile with a cab company.


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## MKEUber (Aug 20, 2014)

TheHairyFiddler said:


> *Ride sharing companies should have minimum fare requirements. * Contact legislators and explain to them the basic economics of Uber and their vulture capitalism tactics. If pax don't want to pay $1.20 per mile for service then fine. They can pay $1.50 per mile with a cab company.


In other words, a Base Fare. Uber already has that, but the abuse the hell out of it by lowering it lower and lower. Meanwhile, their "base fare" called the SRF keeps going up and up. Uber is going to make sure they still get theirs no matter how low they set the rates. lol, what a scam.


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## tomabq (Jan 14, 2015)

MKEUber said:


> In other words, a Base Fare. Uber already has that, but the abuse the hell out of it by lowering it lower and lower. Meanwhile, their "base fare" called the SRF keeps going up and up. Uber is going to make sure they still get theirs no matter how low they set the rates. lol, what a scam.


Welcome to the club, uber continues to pad their pockets while lowering drivers take.


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## raygam (Jan 4, 2016)

oobaah said:


> I said Uber needs Lyft alive due to "Anti-Trust Laws" to some guys that we meet with every now and then...all I got was blank stares...lol





tomabq said:


> Welcome to the club, uber continues to pad their pockets while lowering drivers take.





tomabq said:


> Uber tells us it will produce more fares during our idle time. What they fail to tell you is the market is so saturated that they are saving us from going to1 ride every hour to 1 ride every 2 hrs. The buisness picks up for them not us. They also don't mention the amount of new drivers coming on. They know they have plenty of 25 percenters to replace the 20 percenters. It's a win win for uber.





TheHairyFiddler said:


> Ride sharing companies should have minimum fare requirements. Contact legislators and explain to them the basic economics of Uber and their vulture capitalism tactics. If pax don't want to pay $1.20 per mile for service then fine. They can pay $1.50 per mile with a cab company.





MKEUber said:


> In other words, a Base Fare. Uber already has that, but the abuse the hell out of it by lowering it lower and lower. Meanwhile, their "base fare" called the SRF keeps going up and up. Uber is going to make sure they still get theirs no matter how low they set the rates. lol, what a scam.


Hell, y'all don't need me here! You have it pretty much covered. 
As for the above quotes.. sad but true.


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## raygam (Jan 4, 2016)

tomabq said:


> Welcome to the club, uber continues to pad their pockets while lowering drivers take.


Text message from Uber received today:



> _UBER: Today broke the record for most trips ever on a Sunday. Thanks to you, our driver-partners, hundreds of thousands of people moved around NYC this weekend._


So, if you were in NYC you got to drive more (means more wear & tear on car, more potholes destroying your front end, etc) for less money and, if you were lucky enough to have started after a certain date you got to pay a higher Uber fee, not to mention the sales tax (you know you pay the Uber fee on the sales tax, don't you?)

Me, I stayed home and watched the game.. Just sayin'...


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## efilyojne (Feb 6, 2016)

Here is a little history about the why NYC created the medallion system in the first place. 

UBER is not so much the Future as it is the past.

If you know the history of Yellow, you know that the reason the medallion was created was to limit the number of drivers in an industry where without a medallion, drivers would only work during "Surge" periods. Otherwise why work when there are too many drivers competing for a limited resource of passengers (sounds familiar). UBER is a novel idea, and the TLC dropped the ball and did not innovate, abused its passengers, and got greedy. It became a monopoly. UBER came right in and offered a more efficient way to service its customers and it became a media darling.

However in the end there will (history dictates) need to be a medallion system in place for UBER, just like the one that was created for yellow, otherwise UBER drivers will (already happening) cannibalize each other. UBER knows this, hence the investment into driverless cars.

What will happen soon, (within 2 years I bet) is the same thing that happened during the housing crises... owners will first try to sell their cars take their losses and move into yellow. The remaining UBER drivers will reap the temporary return to the UBER days when there were less drivers more revenue... then the cycle will repeat and if you are lucky, there will be a medallion system put in place that will look eerily similar to the TLC yellow system, or if you are unlucky and driverless tech is ready before your leases are up, those who waited too long to sell (sounds familiar) will walk away from their leases, and rush to the yellow garages because it will be an easy transition. The problem is the garages will only be able to take a percentage (those who come first) and the rest will be left to fend for themselves, now competing against driverless vehicles. Good luck trying to strike then.

My reason for this post, is to say that all drivers, are the same. Don't let UBER tell you any different, they are leveraging you drivers against each other, if you were smart you would do the same. How - Use yellow garages to your advantage. Threaten UBER with the one thing they can't afford you to do. Leave UBER for yellow. Yellow garages are empty, it is an easy transition. That should be your strike formula.

UBER is not the future, just an updated version of the past.

Efilyojne


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## raygam (Jan 4, 2016)

efilyojne said:


> However in the end there will (history dictates) need to be a medallion system in place for UBER, just like the one that was created for yellow, otherwise UBER drivers will (already happening) cannibalize each other. UBER knows this, hence the investment into driverless cars.


Good post! I'm not sure there will ever be a 'medallion system' for the Ubers of this world but I see your point.



efilyojne said:


> My reason for this post, is to say that all drivers, are the same. Don't let UBER tell you any different, they are leveraging you drivers against each other, if you were smart you would do the same. How - Use yellow garages to your advantage. Threaten UBER with the one thing they can't afford you to do. Leave UBER for yellow. Yellow garages are empty, it is an easy transition. That should be your strike formula.


Or, another minor impact would be if traditional black car drivers did not do any Uber work. They too are helping Uber distroy their black car business.


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## efilyojne (Feb 6, 2016)

http://investorplace.com/2016/02/price-cuts-undercut-possibility-uber-ipo/#.VrzNnscvDrM


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## UberEddie2015 (Nov 2, 2015)

If you were a driver and you were out there driving would you want to admit you are uneducated or desperate. So you defend what you do and lie to yourself. I believe some actaully believe they are making money in their mind. They discount dead head mile, depreciation and maintenance. Hey I made $100 today. No they deposited $100 in your account.


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## andy400 (Jan 27, 2016)

raygam said:


> I have been reading a bunch of posts here, about the good money some are making or
> the bad/no money some are making and so on and so forth. To be honest I am simply
> amazed at how new drivers (I am guessing they must be new) are calculating things.
> 
> ...


I agree with you. Many people dont consider how many miles they drive to get a customer. I am making a calculation that is around 40% additional to the miles we drive with UBER. So, considering your costs, and considering that Washington only pays 1.04 per mile, technically we are making a quarter per mile. Technically is like we need to drive 40 miles per hour to make 10 dollars pay. Really crazy.


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## Django81 (Jan 26, 2016)

Not a bad part time gig


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## raygam (Jan 4, 2016)

Interesting day today. Here's yet another subject I have not seen mentioned..

I went to renew my insurance today. As a reminder, I am in NYC and I'm affiliated with a true black car base.

At this point my renewal process is mostly printing up the required papers and paying money. Lucky for me, my annual premium has gone down a little. For those driving on their personal insurance, this is a commercial policy required in NY if one is to drive for hire (reads: money) and is a lot more expensive than personal coverage.

While waiting for them to prepare the required paperwork I remembered that Uber claims to give drivers some coverage. So, I asked if my insurance would be less if I switched to an Uber base - after all, they already cover me for some things.

To my surprise I found out that being affiliated with Uber would cost me * 20% more* annually!

So, I would get to drive for the lowest rates in town, put more miles & wear on my car AND I would get to pay 20% more for my insurance. Yeah, sign me up!

Ah, lucky Uber drivers!


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## Joe Zip (Feb 20, 2016)

I was thinking that Uber is trying to get rid of drivers so they can create artificial surge fares. They make a LOT more when there are surges. If I was their evil financial analyst, I would suggest creating a shortage of drivers to create surges and increase Uber earnings.


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## MKEUber (Aug 20, 2014)

Joe Zip said:


> I was thinking that Uber is trying to get rid of drivers so they can create artificial surge fares. They make a LOT more when there are surges. If I was their evil financial analyst, I would suggest creating a shortage of drivers to create surges and increase Uber earnings.


That is actually not true. I know it is counter-intuitive, but Uber does not make a lot on surge fares because not a lot of people take them. They make the most money by getting as many min fare rides they can in an hour per driver. That is because the majority of their profit comes from the bogus "Safe Rides Fee". The more SRF's they get per hour per driver, the more they make. That is why they make the fares so low, because it gets more people to ride. It is much less profit for the driver, but a windfall of cash for Uber. The more drivers that realize this SRF scam Uber perpetrates, hopefully the more start fighting back.


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## Joe Zip (Feb 20, 2016)

There is that also. That fee plus surges - nice skim.


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