# My argument for Time based pay vs Mileage based pay... if done correctly



## Matty760 (Nov 9, 2015)

Time based pay scale... all rates before Ubers commission

X rates:
$0.75 a min comes out to $45 a hour
$0.55 a mile

XL rates:
$1.25 a min comes out to $75 a hour
$0.55 a mile

All rides are 10 minutes min @ $10 pay to drivers for X rides and $15 to XL drivers.
Booking fee should be around $2.50- $3.00 which only uber gets as it is right now.

Cancel fee is $8 for X and $10 for XL if en route, but goes to min fare pay if on location at the pickup... In other words if you are still driving to the pickup point and the pax cancels, you will get 80% of the min fare. If you are waiting outside for the pax at the pickup location and they cancel or dont come out after the 5 min period then they are charged the min fare fee of $10 for X and $15 for XL. This is to discourage riders from ordering muiltiple cars and abusing the system to see what car gets to them first and only pay a small fee for the cancel and then try to dispute the fee later on. Cuz if the driver is at the spot then its in gold for at least a min fare no matter what.

For long pickups the rider would be advised that the closest driver is more than 10 mins away and that a charge for time and distance will start the moment the driver accepts the ride and is en route. So in other words, a long pickup fee is added in the form of the time starting from when the driver accepts the ride AND starts driving towards the pickup point which means the driver is being paid the time and mileage for the "dead head" time to get to the rider. I hope that is clear enough. If I get a request that is 15 mins away and 10 miles to pickup then i will get paid for that time and mileage to pickup dependent on what type of car was ordered. This is to encourage drivers to accept rides from farther away and getting passenger a driver to them in a area that no drivers are in normally or cuz its busy.

Now the biggest question im sure most will have... how about surge pricing? Surge can still be implemented during busy times but wont be as high as in the past. Surging would max out at 3x to prevent huge costs to riders. yes I know its a money making part of driving rideshare, but the reason will love surge so much is cuz the rates are so low that when it surges so high it gets to the point where its awesome to make money. Now that the time based pay would be paying more already theoretically twice of what we are getting now the surge wouldnt need to get so high anymore and drivers would still be able to make money as before, possibly even more in some cases, but also less in some cases compared to current structure. If you think about how surge pricing has been manipulated in the last couple years during coachella and etc you know that the days of 7x surge are gone., heck even the days of 5 x surge are gone. the max seems to be 2.5x at most concerts now so we just need to work with it. heres the thing though... surge would only be affecting the time based part of the price and not the mileage. The reason for this is mainly for tax purposes to keep it tidy looking and also the fact that the pay for time is considerably more so when the surge kicks in it doesnt make the riders pay astronomical yet is significant enough to show increased demand for the service and pay the driver fairly for the demand part of the job and being available.

So overall that is my proposition for time based pay vs mileage. You all are more then welcome to make comments and suggestions for changes to make it better or maybe problems that i haven't accounted for. Overall it would be fair to the drivers and riders wouldnt see too much of a increase and also Uber would be able to still make money for their commission as well. Its a win win.


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## Matty760 (Nov 9, 2015)

I forgot to add that with my pricing structure there would be a change for the amount of pax for Uber X......
Uber X would be for 1-3 pax and Uber XL would be for 4-6 pax. The reason for this change is pretty simple. Most uber X rides are 3 people or less so this change wouldn't really hurt much at all for any drivers. What it would do is help the XL cars out on the road make best use of their SUV by getting those groups of 4 that would normally SQUEEZE into a prius or what not and give that XL drive a fare at XL pricing. No one likes a cramped ride. This increased use for the XL market would probably also allow uber to make more on those 4 pax rides as well and grow the XL market a lot more and create incentives for XL where right now XL is barely included in any quests or promos currently. Uber also should take only a 15% commission but if they were to go to 20% across the board for both X and XL then I think that would be acceptable for most.... this would eliminate that stupid 28% commission rate that Uber implemented for XL rides which makes no sense still to this day. Grandfathered drivers that are already at the 20% I think should be put on a special tier where only 10% commission is taken. Uber would pretty much need to change their upfront pricing a bit to accommodate these changes. For example, instead of giving a exact amount for a ride, they would need to go back to the days of quoting a range but having the min fare showing. The app can calculate the exact miles and time based off google maps and create a fare for that but that would be the absolute min since of course theres traffic th account for and maybe stops through drive thrus or the store etc. Uber would still make more money this way as well as the drivers so it would be in their best interest to do this. Anyways as I've said before please leave any comments or suggestions... surprised I haven't seen any comments yet in the last week since I posted this. I think that means a lot of people must like the idea.


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## IthurstwhenIP (Jan 12, 2018)

Long winded I need a raise. Heard since the first job was created


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## Matty760 (Nov 9, 2015)

Here are some examples of my time based pay vs the mileage based pay currently in affect... Booking fee isn't included when figuring commission and has never been paid to driver so I won't use it except for the amount that pax pays. Ill put $3 as the booking fee for now. going off of generic 20% commission for example purposes. The rates used for current rates are based off my market of Palm Springs, CA 

ok here we go...

10 mile ride @ 20 mins long using XL on Time based pay

10 miles @ $.55 a mile = $5.50
20 mins @ $1.25 a min = $25
total of $30.50 (before 20% commission)proposed rate
Driver gets $24.40
Uber gets $6.10
Pax Pays $33.50
--------------------------------------------------------
Same ride on mileage based pay using XL

10 miles @ $1.96 a mile = $19.60
20 mins @ $.22 a min = $4.40
base fare of $1.60
total of $25.60 (before 28% commission) current rate
Driver gets $18.43
Uber gets $7.17
Pax pays $28.60
========================================
for X rides all you need to do is calculate the mins from $1.25 to 75 cents.

Time based:
10 miles x $.55 = $5.50
20 mins x $.75 = $15
total of $20.50 (before 20% commission)
Driver gets $16.40
Uber gets $ 3.60
Pax pays $ 23.50
-------------------------------------------------------
Mile based:
10 miles x $1.21 = $12.10
20 mins x $.15 = $3
Base fare $1
total of $16.10 (before 20% commission)
Driver gets $12.88
Uber gets $ 3.22
Pax Pays $19.10

As you can see the pax would be paying a little bit more. I calculate that a pax would be paying somewhere between 20-25% more for most rides. If the ride does go longer then that would add to the price. For us out here in the desert the main reason for longer rides would be mostly due to store stops or drive thrus late at night etc. This would encourage us to do those stops and not worry about getting back online to do another job as much since rushing isn't the name of the game here since pay is based off time and not distance. 

Obviously not all of our rides are 10 miles and 20 mins but I wanted to take a ride that a lot of us have taken at numerous points in our driving experience. Ubers cut also for X rides would be much different and would in some cases be more which im sure Uber wouldn't mind at all. The reduction in Ubers cut comes with XL since at this current time they take a 28% cut of the fare and my rates would drop them to 20%. They dont lose too much and for even longer rides would end up making a bit more.

Base fares are pretty simple... its a 10 minute 3 mile min. If you stay under these numbers you will still get paid $10 for X and $15 for XL. Pax would pay roughly $16 min fare for X and $22 for XL... Im including the booking fee in that cost to the pax. Since 80% of fares are the min amount this wold GREATLY improve our earnings for the short rides around the block or just down the street. Hopefully it would also discourage from ordering rides for somewhere they can just walk cuz right now with the rates as cheap as they are now theres little reason to not call a car and what not. If you as a driver go over either the 10 minute mark or the 3 mile point then the fare would go based off actual time and distance from that point. whichever is great. like for instance you go 4 miles but only took 8 mins, you would get paid for 10 minutes and the 4 miles which in this case wouldn't be much more since its the time that makes more money anyways.

Surge is pretty simply put... Just take the total and add on the multiplier of your chose. As you can see just by looking, the total would be more with time based which means a surge would pay more vs the mileage based pay right now. Surge amount would be limited to 3x though which is fine since most surges dont go above 3x anymore now days. If it does then its a rare thing but it can happen. Cancel fees would also be included for surge. Also since we would be getting more that means a surge of 1.5x would be a lot more enticing than at current rates right now, so just some food for thought.

Lastly if you keep looking at my numbers above you will see that basing off of our time and not mileage can actually be a great benefit to the driver. The pax does pay a little more yes, but Im sure most pax wouldn't even mind the increase at all since its not much more and honestly its still a very fair price. Base rides would be much better paying to drivers as well.

Please tell me what you think? I want some feedback here. Thanks


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## Matty760 (Nov 9, 2015)

Bump


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## IthurstwhenIP (Jan 12, 2018)




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## The_Solo (Feb 23, 2019)

Lmao. Your funny. So first if they pay went to be like that there would just simply be so many drivers on the road no one would get any work. 
Secondly UberX being capped at 3 is not smart. Your car has 4 seats ands that equals 2 couples. More than good. The main problem is pool in my opinion. 2 people should cost more than 1 and the passengers should be paying more each overall. The pay should increase per each pickup we do to incentivize pool rides being taken. Off track on that one.
Lastly tho, and I’ve mentioned before elsewhere, you talk like Uber should care about us or the riders. They have 1 care only keep enough drivers online to handle the passengers they have requesting rides. PERIOD. I’d say currently the pay is like crap for drivers and the pax love the cheap prices. BUT we the drivers keep driving and what that tells Uber is we will work for crap. We complain but we work. They don’t care if we’re unhappy all they care about is will we drive. We drive they leave us hanging on money.


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## oldfart (Dec 22, 2017)

I didn’t follow your math but As I’m sure you know, uber is already moving in your direction. In a lot of markets they decreased the mileage rate and increased the time rate. To put more emphasis on time

I don’t like thinking in terms of hourly pay and i don’t thonk minimum wage ought to be our target but I have thought about it

Every market is different and there are differences between drivers but Ive been tracking my paid time vs my total time On a typical day it works out to about 35% (in a 10 hour day I have a paying passenger in the car 3.5 hours) So to make $15 per hour in a 10 hour day My passengers would have to pay me $150/210 or 71.5 cents a minute after the Uber cut and since Uber seems to need 30%+ that means $1/ min’

Passengers would have to pay $1/ min

But that’s so I can make $15 an hour. How about my car? I’ve been tracking miles with a passenger in the car vs total miles too and that ratio works out to be closer to 50% So using this years irs rate of 58 cents a mile I’d have to make $1.18 per passenger mile. Of course Uber will want their share so let’s jut call it $1.50/mile
So that means for that 10 mile, 20 min ride my passengers would pay $15 + $20 or $35 and I’d get paid $23 and for the ride I like; 30 miles in 40 min the passenger would pay $85 and I’d get almost $60 vs the $30 I get now


I don’t see that happening with Uber or lyft. It’s nice to think about or more to the point, dream about but it ain’t happening

Here’s what I’m doing. I’m building a private ride business and simple guy that I am, my rates are Uber rates but I keep the whole fare

So I guess what I’m saying is: if you don’t like what Uber is doing, start your own company


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## exnihilodrive (Oct 4, 2017)

Pay per hour will screw you over in taxes which you deduct miles. 
Don't outsmart yourself.


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## oldfart (Dec 22, 2017)

exnihilodrive said:


> Pay per hour will screw you over in taxes which you deduct miles.
> Don't outsmart yourself.


You will still be able to deduct your miles


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## exnihilodrive (Oct 4, 2017)

oldfart said:


> You will still be able to deduct your miles


I never said you won't be able to.
But if you are leveraging for time and not miles you will be driving less miles overall.
Which means less miles deducted for the same pay and you will owe more in taxes.


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## The_Solo (Feb 23, 2019)

exnihilodrive said:


> I never said you won't be able to.
> But if you are leveraging for time and not miles you will be driving less miles overall.
> Which means less miles deducted for the same pay and you will owe more in taxes.


Your logic seems heavily flawed! Whether you get paid by hour/miles/whatever the miles you drive per hour would remain the same. Therefore the deductions shouldn't change. The only thing that would then cause you to owe more taxes would be making more money. I'm ok paying more taxes because I am making more money.


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## exnihilodrive (Oct 4, 2017)

The_Solo said:


> Your logic seems heavily flawed! Whether you get paid by hour/miles/whatever the miles you drive per hour would remain the same. Therefore the deductions shouldn't change. The only thing that would then cause you to owe more taxes would be making more money. I'm ok paying more taxes because I am making more money.


Nope. My logic makes sense. 
Drivers will adjust how they drive to maximize pay which may be less miles but more time in traffic. 
Even now driving long distances doesn't make nearly as much anymore.


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## oldfart (Dec 22, 2017)

paying more taxes is a good thing. It means you made more money


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## Matty760 (Nov 9, 2015)

exnihilodrive said:


> Nope. My logic makes sense.
> Drivers will adjust how they drive to maximize pay which may be less miles but more time in traffic.
> Even now driving long distances doesn't make nearly as much anymore.


Less Miles on your car means less wear and tear which means less maintenance. Your goal is make the most amount of money possible without it costing you much for other costs. So your logic is flawed by this as Im not going to drive more miles just so I can write off the miles when i then have to do more maintenance which costs more than paying more taxes to IRS. I work in the Limo Transportation business and Im telling you that the per mile was great for doing Uber and Lyft when the prices were high but now that they are so low it makes no sense anymore so time based is what pays. Especially now days these young kids make you wait or want to make stops etc. If you are in LA traffic im sure you would be glad to be paid for time rather than miles. Overall mileage isn't the biggest depreciation of a car now days since most cars can now go 300k with todays standards. Its more of a age thing and how well a car is taken care of that depreciates a car. SO many people worried about miles and writing them off like I was just find out that the more miles you write off and want to deduct then the more the IRS may audit you and check your logs and etc. Just saying

also paying based on time rather than miles also cause more safety in rides cuz it incentivizes drivers to take their time and go the speed limit and not rush which is when most accidents occur is when rushing. A slower car is a safer car plus its a better ride


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## oldfart (Dec 22, 2017)

Matty760 said:


> Less Miles on your car means less wear and tear which means less maintenance. Your goal is make the most amount of money possible without it costing you much for other costs. So your logic is flawed by this as Im not going to drive more miles just so I can write off the miles when i then have to do more maintenance which costs more than paying more taxes to IRS. I work in the Limo Transportation business and Im telling you that the per mile was great for doing Uber and Lyft when the prices were high but now that they are so low it makes no sense anymore so time based is what pays. Especially now days these young kids make you wait or want to make stops etc. If you are in LA traffic im sure you would be glad to be paid for time rather than miles. Overall mileage isn't the biggest depreciation of a car now days since most cars can now go 300k with todays standards. Its more of a age thing and how well a car is taken care of that depreciates a car. SO many people worried about miles and writing them off like I was just find out that the more miles you write off and want to deduct then the more the IRS may audit you and check your logs and etc. Just saying
> 
> also paying based on time rather than miles also cause more safety in rides cuz it incentivizes drivers to take their time and go the speed limit and not rush which is when most accidents occur is when rushing. A slower car is a safer car plus its a better ride


Less miles means les maintenance? I wouldn't be so sure about that. I'm no mechanic but I always thought that an hour at 70 mph is easier on an engine than an hour at 10 mph. My boats maintenance schedule is based on "hours" and I have an "hours meter" not an odometer

I agree we need a rate schedule that gives more emphasis to time but I think it's possible to go too far.

In my business I'm trying to develop an either/or pricing schedule. Either $/mile or $/min, whichever is greater. And I want to factor in dead miles

Dead miles and dead time is my biggest concern Uber makes the assumption with their pricing that you will get a new ride where the old ride ends. As we all know that's not always the case.


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## touberornottouber (Aug 12, 2016)

oldfart said:


> I didn't follow your math but As I'm sure you know, uber is already moving in your direction. In a lot of markets they decreased the mileage rate and increased the time rate. To put more emphasis on time


Actually, no. They radically lowered the per mileage rate and then barely increased the per minute rate. The overall result was a further reduction in driver pay. Then they just used corporate doublespeak to get you to accept it.

They could have set it so that on average the pay would have been the same but they chose not to do that because they are greedy and they are just looking to further exploit drivers.


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## oldfart (Dec 22, 2017)

touberornottouber said:


> Actually, no. They radically lowered the per mileage rate and then barely increased the per minute rate. The overall result was a further reduction in driver pay. Then they just used corporate doublespeak to get you to accept it.
> 
> They could have set it so that on average the pay would have been the same but they chose not to do that because they are greedy and they are just looking to further exploit drivers.


I'm not saying they got it right, and I'm not speaking to motivation; only that they made a change to give time a little more emphasis. Ie they are moving in your direction


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## Diamondraider (Mar 13, 2017)

The_Solo said:


> Your logic seems heavily flawed! Whether you get paid by hour/miles/whatever the miles you drive per hour would remain the same. Therefore the deductions shouldn't change. The only thing that would then cause you to owe more taxes would be making more money. I'm ok paying more taxes because I am making more money.


He is talking about the reduced advantage of the MILEAGE DEDUCTION (the argument assumes reduced miles driven traded for longer time )


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## FLKeys (Dec 27, 2018)

Look at your last 20 trips with Uber and calculate what you were paid vs what you would be paid under the new rates.

For all of my trips last week (48 in total) under the new rates I would have made $30.26 less. I don't drive in high traffic areas so this will be a reduction in earnings for me. I average 40 miles an hour so miles are more valuable than time in my area.


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## Matty760 (Nov 9, 2015)

FLKeys said:


> Look at your last 20 trips with Uber and calculate what you were paid vs what you would be paid under the new rates.
> 
> For all of my trips last week (48 in total) under the new rates I would have made $30.26 less. I don't drive in high traffic areas so this will be a reduction in earnings for me. I average 40 miles an hour so miles are more valuable than time in my area.


 Did you factor in your deadhead time which my rates calculate for? as well as the wait time for your rides when waiting for pax to come into your car? Not to mention any cancel fees? Not sure when you say under the new rates if you are talking about my rates for this post or with new rates that uber has done recently. Just trying to clarify. Also lastly, my rates give more on min fare rides too.


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## FLKeys (Dec 27, 2018)

Matty760 said:


> Did you factor in your deadhead time which my rates calculate for? as well as the wait time for your rides when waiting for pax to come into your car? Not to mention any cancel fees? Not sure when you say under the new rates if you are talking about my rates for this post or with new rates that uber has done recently. Just trying to clarify. Also lastly, my rates give more on min fare rides too.



I calculated what I get paid for by Uber.
I don't get paid for deadhead time, it is not paid by Uber so why would it be factored in?
If I got paid wait time on a trip yes I factored that in, if I did not get paid wait time no I did not.
I did not calculate in cancel fees they are not based on time and miles.
As for rates I used my rates for my area that have not changed since I started driving as my base numbers
For new rates in my calculations I used +16% for time and -25% for mileage of my current rates based on what another member posted as the new rate adjustments. If my market gets this new rate adjustment I will alter my figures to those numbers to get a better net result for my market.
I did 9 minimum fare rides in the week I analyzed, none of those trips would have been anymore than the minimum fare amount I got. None of the trips that week dropped to a minimum fare trip based on the new rates.
I stand behind my numbers.


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## oldfart (Dec 22, 2017)

Matty760 said:


> Did you factor in your deadhead time which my rates calculate for? as well as the wait time for your rides when waiting for pax to come into your car? Not to mention any cancel fees? Not sure when you say under the new rates if you are talking about my rates for this post or with new rates that uber has done recently. Just trying to clarify. Also lastly, my rates give more on min fare rides too.


When do you expect your rates to come to the Florida markets?


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## Matty760 (Nov 9, 2015)

FLKeys said:


> I calculated what I get paid for by Uber.
> I don't get paid for deadhead time, it is not paid by Uber so why would it be factored in?
> If I got paid wait time on a trip yes I factored that in, if I did not get paid wait time no I did not.
> I did not calculate in cancel fees they are not based on time and miles.
> ...


In other words when you say you make less with new rates you were talking about Ubers current rate and not mine. thats all I was asking you since seem to imply that the new rates were mine as put in this post. Thanks



oldfart said:


> When do you expect your rates to come to the Florida markets?


I wish my rates would be the same across the whole nation. Never have really agreed with the argument Uber makes that certain areas in the nation deserve either higher rates like in my area, or lower rates like in Detroit. My area in Palm Springs, CA probably has one of the highest pay rates in the nation or close to it. Wether you live in Florida Michigan Texas or CA I would think it should be the same everywhere. Just like I can go to a Mc Donalds and order their Triple cheeseburger for $3 anywhere in the USA. I know its mostly due to gas prices but still just never has made much sense other than lowering rates to what drivers will drive for still.


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