# What is your return on capital?



## BrokeAzzLooser (Jun 1, 2015)

There are a lot of posts here on how dissatisfied drivers are with the how much Uber pays. The hourly rate of pay is often quoted as close to or even below the national minimum wage. This is sad but in my opinion what is actually happening is a lot worse than that.

I do believe that this is a case of wealth transfer. The little bit of equity the drivers have invested in their vehicles is being transferred directly to Uber. Most drivers are struggling to make ends meet and need an additional source of income. It is no doubt convenient to just turn on the Uber app on one's phone and get paid for driving around and most drivers are concerned with how much they will "earn" an hour minus the cost of the gas used. But one invests money or capital goods in a business expecting some return, a profit greater than the initial investment. The return the drivers get from driving for Uber is negative. In other words they lose money by losing the value of their vehicle.

What really eliminates the benefit of instant cash and the convenient method of obtaining it is the cost of the *vehicle depreciation*. When self-employed people in the USA use their vehicles in the course of their business the IRS allowance is *$0.575 per mile* to cover fuel, maintenance and depreciation.

So if one is driving 50 hours a week and covering 1,000 miles, taking $600, what is the end result? The driver has covered the cost of maintaining the equity in his vehicle and donated his or her time to Uber. Or, the driver has used the $600 to pay his bills and transferred the equity in the vehicle to Uber. Either way as far as the driver is concerned this is a loosing game in which the vehicle depreciation is not covered which means that after few years the driver will have to take a new car loan to replace the vehicle and get further into debt.

The flow of value is always a one way street from the driver to the company which explains the Uber business model: robbing the poor drivers of the little bit they have. No wonder the company is expected to make *$10 billion* this year. How much of that is the value sucked out of your car?


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## UberRidiculous (May 19, 2015)

BrokeAzzLooser said:


> There are a lot of posts here on how dissatisfied drivers are with the how much Uber pays. The hourly rate of pay is often quoted as close to or even below the national minimum wage. This is sad but in my opinion what is actually happening is a lot worse than that.
> 
> I do believe that this is a case of wealth transfer. The little bit of equity the drivers have invested in their vehicles is being transferred directly to Uber. Most drivers are struggling to make ends meet and need an additional source of income. It is no doubt convenient to just turn on the Uber app on one's phone and get paid for driving around and most drivers are concerned with how much they will "earn" an hour minus the cost of the gas used. But one invests money or capital goods in a business expecting some return, a profit greater than the initial investment. The return the drivers get from driving for Uber is negative. In other words they lose money by losing the value of their vehicle.
> 
> ...


Thank you for posting this. There are some drivers in some markets with some surges and better rates that are able to be profitable. They are the exception and your analysis is the Uber Rule.
Good Job Excellent Post.


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## DrJeecheroo (Feb 12, 2015)

Good post. It's very unfortunate that uber can't be consistent with their rates across the country. I can understand why it might vary depending on what the cost of living is in that state/city. Like big cities like NewYork, and such, you would expect higher rates because of how expensive it is. Of course Chicago and other cities where uberx is around .90/mile completely throws off that logic.


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## GooberX (May 13, 2015)

When I started, Uber X was $3 base, $2.45 per mile, and $5 minimum (No SRF) with no per minute charge.

Then, they switched to $3 base, $2 per mile, 35 cents a minute, and $5 minimum (No SRF). <---------this is the perfect rate for Uber X. 

At those rates, I was willing to pick up anyone, going anywhere, at any time. All drivers were pro Uber, loved Uber, and the clients knew it.

Then they started the downward race to zero.

Bad idea.


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## BrokeAzzLooser (Jun 1, 2015)

Agreed GooberX,

The downward race is basically a price war aimed at capturing market share. Uber has raised billions of $$$ but is using the drivers money and time to fight that war. It really is the drivers own fault for going along with it and advancing against that machine gun nest. I am not blaming them because the whole thing just shows the state of the economy. There are millions out there in the USA who live from hand to mouth and are desperate for cash. Otherwise why would anyone in their right mind agree to work for free or would sign over the title to their car to Uber?


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## UberRidiculous (May 19, 2015)

BrokeAzzLooser said:


> Agreed GooberX,
> There are millions out there in the USA who live from hand to mouth and are desperate for cash. Otherwise why would anyone in their right mind agree to work for free or would sign over the title to their car to Uber?


There are various reasons starting with new drivers lacking industry knowledge and lacking a fair assessment of true expenses. Then many drivers are just too trusting and many are bad at math. I'm sure there are more reasons that makes this scam easy.


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## GooberX (May 13, 2015)

UberRidiculous said:


> There are various reasons starting with new drivers lacking industry knowledge and lacking a fair assessment of true expenses. Then many drivers are just too trusting and many are bad at math. I'm sure there are more reasons that makes this scam easy.


Unfortunately, you are right.

I'd much prefer to drive UberX, but I can't afford it at those rates.

Most drivers need math lessons.


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## limepro (Mar 7, 2015)

You can catch back up when your depreciation plateaus or if you begin with a car that has already hit rock bottom lol.


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## toi (Sep 8, 2014)

BrokeAzzLooser said:


> There are a lot of posts here on how dissatisfied drivers are with the how much Uber pays. The hourly rate of pay is often quoted as close to or even below the national minimum wage. This is sad but in my opinion what is actually happening is a lot worse than that.
> 
> I do believe that this is a case of wealth transfer. The little bit of equity the drivers have invested in their vehicles is being transferred directly to Uber. Most drivers are struggling to make ends meet and need an additional source of income. It is no doubt convenient to just turn on the Uber app on one's phone and get paid for driving around and most drivers are concerned with how much they will "earn" an hour minus the cost of the gas used. But one invests money or capital goods in a business expecting some return, a profit greater than the initial investment. The return the drivers get from driving for Uber is negative. In other words they lose money by losing the value of their vehicle.
> 
> ...


Spot on , thank you for your time writing this.
One thing to take note is nobody who does transportation has anything in mind as "resale value" of their vehicles.
They simply run it to the ground.
There is no way around it.


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## GooberX (May 13, 2015)

toi said:


> Spot on , thank you for your time writing this.
> One thing to take note is nobody who does transportation has anything in mind as "resale value" of their vehicles.
> They simply run it to the ground.
> There is no way around it.


Although you are correct, there is one thing you are missing.

Eventually, that car will have to be replaced.

If you don't get proper value for its equity, how will you replace the vehicle?


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## toi (Sep 8, 2014)

GooberX said:


> Although you are correct, there is one thing you are missing.
> 
> Eventually, that car will have to be replaced.
> 
> If you don't get proper value for its equity, how will you replace the vehicle?


Not really, just change engine and transmission when needed.
and when i said whoever does transportation, i meant whoever is doing it properly as in "commercially"
with proper sustainable prices.i should have cleared it in the original post.


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## GooberX (May 13, 2015)

toi said:


> Not really, just change engine and transmission when needed.
> and when i said whoever does transportation, i meant whoever is doing it properly as in "commercially"
> with proper sustainable prices.i should have cleared it in the original post.


Gotcha, ok, agreed.

Some of those livery cars go 800K-Million miles.


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## 20yearsdriving (Dec 14, 2014)

limepro said:


> You can catch back up when your depreciation plateaus or if you begin with a car that has already hit rock bottom lol.


Nope by then your cost of repairs exceeds previous depreciation rate


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## limepro (Mar 7, 2015)

20yearsdriving said:


> Nope by then your cost of repairs exceeds previous depreciation rate


A well taken care of car can last 300k miles with only basic maintenance, I had over 300k on a dodge truck until the transmission went out.


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## 20yearsdriving (Dec 14, 2014)

GooberX said:


> Gotcha, ok, agreed.
> 
> Some of those livery cars go 800K-Million miles.


There is a local guy with a 2001 town car with 1 million miles


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## limepro (Mar 7, 2015)

I think Al Bundy went a million miles in his old dodge.


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## 20yearsdriving (Dec 14, 2014)

limepro said:


> A well taken care of car can last 300k miles with only basic maintenance, I had over 300k on a dodge truck until the transmission went out.


If you want to make money your car will be driven on " severe cycle "

You can minimize repairs on " light cycle "

UBER is actually worst than severe since it probably a lot of city driving


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## 20yearsdriving (Dec 14, 2014)

Heater core 
A/C commpressor
Radiator
Starter 
Door lock Actuator 
Window regulator 
Ball Joints 
Axle Shaft 
U Joint
Wiper Motor
Blend Door
Water Pump
Serpentine Belt Tensioner

Some the things that won't last 200k

And the deadly "Electrical" Engine " Transmission " problems


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## toi (Sep 8, 2014)

heater core is one of the worst repairs in town car.
6 hour labor for a $50 part .jeezzz. had it twice in 12 years on my cars.


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## 20yearsdriving (Dec 14, 2014)

toi said:


> heater core is one of the worst repairs in town car.
> 6 hour labor for a $50 part .jeezzz. had it twice in 12 years on my cars.


I learned to do it my self
In a 1993 crown Victoria
I've done 8 ever since
I'm down to 3 hrs

All other repairs including transmission
& engine swap

I've done @ home with help from a "mechanic" on side job duty


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## GooberX (May 13, 2015)

20yearsdriving said:


> I learned to do it my self
> In a 1993 crown Victoria
> I've done 8 ever since
> I'm down to 3 hrs
> ...


That's great, but it's still an expense, albeit one mostly payable with elbow grease.

Most professional drivers do have some mechanical skills, or should.

You still operating that Crown Vic?


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## 20yearsdriving (Dec 14, 2014)

GooberX said:


> That's great, but it's still an expense, albeit one mostly payable with elbow grease.
> 
> Most professional drivers do have some mechanical skills, or should.
> 
> You still operating that Crown Vic?


Skills with the toolbox are a must ( strategic advantage )

I got as far as knowing what needed to be replaced when ( before it broke)
Always did preventive maintenance and preventive repairs
I never broke down

I even did a brand new fuel pump every 2 years just in case

Only once in my life I towed a vehicle

Last panther platform was a 2003 town car ( retired in January this year )

I broke down on Mission & Milliken in ontarion once
Broken in take manifold
Walked 1/4 mile to the pick a part junk yard
There is a guy selling tools there ( el Tigre )

Purchased tools & removed intake my self
Swaped on side of the road

Running in 2hrs


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## GooberX (May 13, 2015)

20yearsdriving said:


> Not any more
> 
> Last panther platform was a 2003 town car ( retired in January this year )


Those cars were something else.

There is a reason why cab companies used to go buy the police interceptor crown vics from the auctions, painted them, and put them in service.

Pretty much indestructible.


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## toi (Sep 8, 2014)

20yearsdriving said:


> Skills with the toolbox are a must ( strategic advantage )
> 
> I got as far as knowing what needed to be replaced when ( before it broke)
> Always did preventive maintenance and preventive repairs
> ...


Here is a question then. 
Abs light n brKe light both came on in my 08 town car. Goes out after parked awhile. 
I am guessing wheel speed sensor or some sort of sensor. What do u think?


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## 20yearsdriving (Dec 14, 2014)

toi said:


> Here is a question then.
> Abs light n brKe light both came on in my 08 town car. Goes out after parked awhile.
> I am guessing wheel speed sensor or some sort of sensor. What do u think?


90% it's the abs module 
Simple fix

Order a used one on EBAY
Around 80 bucks or less
Go by the part # its about 20 digits & letters long

Swap takes 30 I think it's a torx bit 
6 bolts 1 connector


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## 20yearsdriving (Dec 14, 2014)

toi said:


> Here is a question then.
> Abs light n brKe light both came on in my 08 town car. Goes out after parked awhile.
> I am guessing wheel speed sensor or some sort of sensor. What do u think?





toi said:


> Here is a question then.
> Abs light n brKe light both came on in my 08 town car. Goes out after parked awhile.
> I am guessing wheel speed sensor or some sort of sensor. What do u think?


Actually more like 100.00
On eBay


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## toi (Sep 8, 2014)

20yearsdriving said:


> 90% it's the abs module
> Simple fix
> 
> Order a used one on EBAY
> ...


Not if its a limo 
I hope its not it. Could u PM a link to what exactly u mean by that part pls?
Thank you


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## 20yearsdriving (Dec 14, 2014)

toi said:


> Not if its a limo
> I hope its not it. Could u PM a link to what exactly u mean by that part pls?
> Thank you


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## 20yearsdriving (Dec 14, 2014)

Won't let me PM images or videos

There will be a part # on the actual ABS module order the same part#

I belive its not different on a limo as long as you match the part # you're good 

I would try to stay in the 100-130 price for a used one 


You can send it for re-built look in EBAY

The car is drivable with the module removed


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## toi (Sep 8, 2014)

20yearsdriving said:


> Won't let me PM images or videos
> 
> There will be a part # on the actual ABS module order the same part#
> 
> ...


Yes these cars are the best for what they are worth.thank you


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## YouWishYouKnewMe (May 26, 2015)

Yes Uber sucks so hard to stay prpfitable


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## toi (Sep 8, 2014)

Here is my Daily driver. 03 TC with 99k on the clock


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## BrokeAzzLooser (Jun 1, 2015)

It's great that you guys have the skill to perform such complex repairs. However the issue is that if an Uber driver does that he will have to give up driving time which reduces his earnings yet again. On the other hand one would have to try and fix and maintain the car by himself to avoid reducing income even further but if the driver is skilled enough to perform mechanical work why not get a job as a mechanic and earn $50+ an hour instead of the pittance Uber pays? 

Do-it-yourself maintenance and repair and the low pay are really an issue of public safety. We can be pretty sure that someone somewhere is compiling a thick file and waiting for an accident involving an Uber driver and a passenger to begin a law suit or some regulatory action. It's just a matter of time...


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## 20yearsdriving (Dec 14, 2014)

BrokeAzzLooser said:


> It's great that you guys have the skill to perform such complex repairs. However the issue is that if an Uber driver does that he will have to give up driving time which reduces his earnings yet again. On the other hand one would have to try and fix and maintain the car by himself to avoid reducing income even further but if the driver is skilled enough to perform mechanical work why not get a job as a mechanic and earn $50+ an hour instead of the pittance Uber pays?
> 
> Do-it-yourself maintenance and repair and the low pay are really an issue of public safety. We can be pretty sure that someone somewhere is compiling a thick file and waiting for an accident involving an Uber driver and a passenger to begin a law suit or some regulatory action. It's just a matter of time...


Good point

Specially the last part

I'm a livery driver , I make more driving than repairing
When I do preventive repaires its on my dead time
If I save 70.00 an hour in labor ,it's like I made 70.00 an hour

I've driven almost 2 million miles
You can imagen I had the need to learn

One time I saved my sister in law 400.00 in 10 min

She drives a jeep commander
The A/C blower fan was not working properly
Probable cause the "brushes" are dirty & clogged "
I got under the dash hit the motor with a hammer voilah
It's been 3 yeas still working perfect
And there is many other stories like that


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## DrJeecheroo (Feb 12, 2015)

20yearsdriving said:


> Good point
> 
> Specially the last part
> 
> ...


DINGO!!


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## UberPissed (Aug 13, 2014)

I posted a $2,200 loss on my Schedule C last year driving for uber, and I had over $6,000 in revenue.


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## toi (Sep 8, 2014)

20yearsdriving said:


> Won't let me PM images or videos
> 
> There will be a part # on the actual ABS module order the same part#
> 
> ...


It was the abs module as you suggested.
Thank you very much .
Found a shop at van nuys that fixes these for like $100 . Piece of cake voila !!


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## 20yearsdriving (Dec 14, 2014)

toi said:


> It was the abs module as you suggested.
> Thank you very much .
> Found a shop at van nuys that fixes these for like $100 . Piece of cake voila !!


A good forum for you

Crownvic.net


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## toi (Sep 8, 2014)

20yearsdriving said:


> A good forum for you
> 
> Crownvic.net


You are a lucky find in this rookie forum.
Crownvic.net and lincolnsonline would be the forums to look into for this problem


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## 20yearsdriving (Dec 14, 2014)

If you ever need anything let me know 

I know a few "patch all"
"Mechanic in a can"
& "Miracle potions"


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## chi1cabby (May 28, 2014)

BrokeAzzLooser said:


> The hourly rate of pay is often quoted as close to or even below the national minimum wage. This is sad but in my opinion what is actually happening is a lot worse than that.
> I do believe that this is a case of wealth transfer. The little bit of equity the drivers have invested in their vehicles is being transferred directly to Uber.


Thank you for starting the thread!
Ever since Aug 2014 Rate Cuts, I've contended 


chi1cabby said:


> Uber as a profit making corporation has the right to make policy decisions, that are it's best interest.
> But Uber does not have a right to discount *Drivers operational economics*, and go forward with it's policies on the backs of *Driver's Labor and Capital (cars).*


*Poll | I Will/Will Not Pitch In Towards Ending UberXPLOITATION To The Best Of My Ability*


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## chi1cabby (May 28, 2014)

toi & 20yearsdriving, thanx for turning this thread into Vehicle Longevity & DIY maintenance!


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## 20yearsdriving (Dec 14, 2014)

Theory , debate , rant , wishfull thinking 
only go so far 

We saved 600.00 in diagnose & labor 

Real results


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## ubtight (Nov 19, 2014)

Let's bring it back to topic. Yes, there are smart, hard-working people out there who seem to make driving Uber viable. Maybe this is the only available job option. Maybe they love cars and driving. Maybe it's just short-term (If it is, just be careful of getting caught in the hamster wheel -- AKA DO NOT BUY A NEW CAR TO DRIVE FOR UBER). 

But for the real business folk, the real money is investing in self-driving cars. Uber sees itself a huge player in this arena. Considering how it's positioning itself against the drivers, take the hint! They don't want more drivers. They eventually want NO DRIVERS. 

The market proves it wants push-button transportation. But they want it cheap. Uber is going to fill that need as soon as it can with self-driving cars. If anyone thinks Uber cares about your rent money, think again and start working on Plan B, which should be buying a fleet of self-driving cars.


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