# Uber: Future is doomed?



## JesusisLord777 (Dec 4, 2016)

I posted this in another forum not realizing that this one existed, and was more appropriate. I'm curious to get the thoughts of my fellow Uberites...

I have been thinking about autonomous cars lately, and what Uber seems to be trying to shape their company into, and then it dawned on me.... They may be headed over a cliff if they continue to pursue this current direction. I will explain what I mean...

The CEO of Uber has seemingly said that he wants to make it to where exclusively using Uber is cheaper than owning a car, but in the end is this really a wise business move?

What do I mean?

Subsidies.

That's the magic word here. If you look at all public transportation in America, it is a completely unsustainable enterprise without copious amounts of Government subsidies.

In fact, it's my understanding that even Greyhound and Amtrak are subsidized, despite oftentimes not being much cheaper than a plane ticket.

I might be mistaken, but I would think that the train system in Japan might be one of the few public transportation systems that makes any money due to the high number of passengers using it.

With all this being said, how does Uber plan to turn a profit with Autonomous cars? Uberpool rates aren't going to cut it, and yet that's what they would have to offer to keep the bus fare crowd.

What would the cost wind up being for Uber? How many autonomous cars would you have to invest in to try and have adequate coverage of Los Angeles? Then there are the service technicians, car manufacturers, and the need to have hub/bays to put all these cars. These are probably just a small number of new expenses they would have to take on. 

This doesn't even cover any other legal issues such as insurance, city regulations, ill will of those against automation, and possibly having to become an actual taxi/livery company, which I imagine would be far more expensive than their current business model.

Perhaps, someone with more insight than me, can explain where they might be going with all of this


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## RamzFanz (Jan 31, 2015)

Take 75%-80% of the costs out of the current fare and you have a great business model for achieving profitable rates far lower than car ownership and maybe even public transportation.

Then consider these will be glorified electric golf carts. Very low operational and building costs and very low maintenance costs.

GM invested $500,000,000 in Lyft and will probably provide the fleet, at GM's actual manufacturing cost, not retail, and at no cost to Lyft. Expect Uber to do the same with a company still to be named.

The feds and most states that are acting now are getting regulations in place to allow all of this to happen, not standing in their way. Insurance rates are based on accidents. Less accidents means lower rates. Tesla and others are even talking about self-insuring every vehicle they expect claims to be so low.


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## JesusisLord777 (Dec 4, 2016)

RamzFanz said:


> Take 75%-80% of the costs out of the current fare and you have a great business model for achieving profitable rates far lower than car ownership and maybe even public transportation.
> 
> Then consider these will be glorified electric golf carts. Very low operational and building costs and very low maintenance costs.
> 
> ...


You may be right, but it this model still seems to beg a lot of questions. What does GM, or another car manufacturer get in return for their investment? I'm assuming that they want their piece of the pie. Does Uber give them a percentage of the fare?

Even if they are glorified golf carts, Uber would still need several hundred thousand of these things to have adequate covrage of the nation.

As for regulations.... Uber is still paying big $$$ trying to get into more markets just with their current business model.

Going through the entire process again seems like it would be very costly, (I'm thinking that not every market is going to welcome autonomous cars right off the bat, and different markets may have different standards for Uber to reach).

Also I don't think Uber could even try hiding behind the legal grey zone that is "rideshare" at that point.

And since different municipalities have varying degrees of hoops to jump through for Taxi/Livery business then I'm assuming that Ubers overhead costs also go up as well, which may offest money saved by eliminating the human driver.

And lastly, I suppose there will be negative political ramifications as well.

Disposing of mass amounts human workers will not be a popular decision no matter what, and to compound this problem, would be the fact that it would only take one serious malfunction of this technology to cause the media to have a field day, and make the entire foundation that they will have worked so hard to build, crumble like so many grains of sand.

Our maybe we will all be taking flying Ubers in thirty years. Should be interesting.


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## Jermin8r89 (Mar 10, 2016)

If self driveing cars run the world then maze well say atleast 70% of careers and work is gone. They wont make money for long


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## RamzFanz (Jan 31, 2015)

JesusisLord777 said:


> What does GM, or another car manufacturer get in return for their investment? I'm assuming that they want their piece of the pie. Does Uber give them a percentage of the fare?


Yes, they do. Almost every major car manufacturer in the world is looking at both SDCs and providing a TNC. They will want a piece of the pie in cooperation with market leaders or to take a piece of the pie as startups. They will partner with a TNC or they will invest.



JesusisLord777 said:


> Even if they are glorified golf carts, Uber would still need several hundred thousand of these things to have adequate covrage of the nation.


They won't cover the nation at first. They will go after the low hanging fruit which is major metropolitan areas. This is our bread and butter and this is 100% what they are focused on, not level 5 _go anywhere do anything_.



JesusisLord777 said:


> As for regulations.... Uber is still paying big $$$ trying to get into more markets just with their current business model.


Yes, because they want to hold market share which leverages them with SDC manufacturers. The regulation argument is almost a non starter as most areas are, or will, embrace SDCs. Most will just follow the feds and the feds are embracing them. Taxis drive the regulation battles today and taxis are 1920's. No one cares.



JesusisLord777 said:


> Going through the entire process again seems like it would be very costly, (I'm thinking that not every market is going to welcome autonomous cars right off the bat, and different markets may have different standards for Uber to reach).


Yes, they won't all embrace them. So many will, the testing and real life results will push the others to accommodate them. Uber wins because people love Uber. SDCs will win because people will love SDCs. Regions that don't have them because they are nonsensically regulated will be forced to accept them in time from public outcry.



JesusisLord777 said:


> Also I don't think Uber could even try hiding behind the legal grey zone that is "rideshare" at that point.


Correct. Rideshare is all but dead in the next 5-7 years. The new legal zone will be to allow safer transportation.



JesusisLord777 said:


> And since different municipalities have varying degrees of hoops to jump through for Taxi/Livery business then I'm assuming that Ubers overhead costs also go up as well, which may offest money saved by eliminating the human driver.


The feds have issued guidelines which will be allowed to govern most states. Far more than enough to start. The liberal states will comply in time as they continue to die at mass rates compared to "flyover" states. These forces, almost all of the major auto and tech companies in the world, don't bow down to liberal idealism.



JesusisLord777 said:


> And lastly, I suppose there will be negative political ramifications as well.


Why? That's not what's happening at all.



JesusisLord777 said:


> Disposing of mass amounts human workers will not be a popular decision no matter what, and to compound this problem, would be the fact that it would only take one serious malfunction of this technology to cause the media to have a field day, and make the entire foundation that they will have worked so hard to build, crumble like so many grains of sand.


The US disposes of 3,000,000 jobs a year. We just create more.

The _one incident result_ is nonsense. MANY people have died in Teslas and Tesla is bigger than ever with 40% less accidents on autopilot than off. Let's use facts. Lowering the 1,200,000 yearly human driven deaths, even by 40% which isn't even self driving, will always play well.



JesusisLord777 said:


> Our maybe we will all be taking flying Ubers in thirty years. Should be interesting.


It will be. Airbus is claiming they will offer a self flying prototype this year.



Jermin8r89 said:


> If self driveing cars run the world then maze well say atleast 70% of careers and work is gone. They wont make money for long


You neglect the cost of living portion of the equation and exaggerate the loss of income. When human transportation costs are removed from the equation, we will be looking at a 40% - 60% lowering of cost of goods. This means everyone will need to work less to keep the the same standard of living. Part time will become the new full time.


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## Jermin8r89 (Mar 10, 2016)

RamzFanz said:


> You neglect the cost of living portion of the equation and exaggerate the loss of income. When human transportation costs are removed from the equation, we will be looking at a 40% - 60% lowering of cost of goods. This means everyone will need to work less to keep the the same standard of living. Part time will become the new full time


So y does it seem they keep adding prices to things the more technoligy comes out? 1 example:

On Wednesday, February 1 the House Ways and Means committee will hold a public hearing on a bill to create a road usage fee.

The bill, HB 621, would add a fee to annual car registration, based on the miles per gallon of the vehicle, ranging from $0 to $77.08. Cars that do not use any fuel would pay $123.33.

A road usage fee is intended to make up for lower gas tax revenue from hybrid and alternative fuel vehicles. Those vehicles are responsible for just as much wear and tear on roads, and arguably are not paying their fair share for road maintenance.

The Department of Transportation estimates the fee would raise about $11 million per year for construction and repair of state roads and bridges.

Opponents of HB 621 argue that unless the state also lowers the gas tax, the road usage fee is a burdensome tax on residents.

Other opponents argue that alternative fuel and hybrid vehicles provide other benefits to the state, such as cleaner air, and therefore an additional fee is unfair.


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## RamzFanz (Jan 31, 2015)

Jermin8r89 said:


> So y does it seem they keep adding prices to things the more technoligy comes out? 1 example:
> 
> On Wednesday, February 1 the House Ways and Means committee will hold a public hearing on a bill to create a road usage fee.
> 
> ...


That's taxes. The government is going to get theirs.

Cost of goods are going to plummet from a bit after the introduction of self driving through saturation. That also means services will cost less because the equipment, materials, almost everything will cost less.

IMHO we are at the beginning of the end of most human labor.


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## ChortlingCrison (Mar 30, 2016)

RamzFanz said:


> That's taxes. The government is going to get theirs.
> 
> Cost of goods are going to plummet from a bit after the introduction of self driving through saturation. That also means services will cost less because the equipment, materials, almost everything will cost less.
> 
> IMHO we are at the beginning of the end of most human labor.


Keep dreamin.


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## RamzFanz (Jan 31, 2015)

ChortlingCrison said:


> Keep dreamin.


You can dream all you want, I'll rely on economics.


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## JesusisLord777 (Dec 4, 2016)

I appreciate your taking the time to respond, and you bring up some interesting and salient points, but I honestly think you are taking an overly optimistic appraisal of the situation. (At least optimistic from Uber's perspective. )

There will no doubt be major political fall out if Uber somehow pulls this off, and guts massive amounts of it's workforce.

You mention that we aren't seeing any fall out now, and this is true, but I suspect that is because it really hasn't become a definitive reality for most entry level sector jobs yet.

Case in point: Fast food.

In the last few months I have been inside both McDonalds and Wendy's stores that have self serving kiosks, and so far they don't amount to a whole lot.

Yes they are there, but they don't seem to work particularly well, the restaurants still had plenty of humans staffing the registers, and it didn't appear that the stores were really pushing the concept as much as expirimenting with it.

The same with self check-outs with Wal-Mart. They exist, and people use them, but it doesen't really seem to have made a major dent in the number of employees.

The Super Wal-marts where I live, still seem to have plenty of humans working registers, and of course new positions are created in an effort to make sure that an employee is watching all self checkout customers like a hawk, not to mention the constant time spent fixing problems with the automated-registers, stocking them with money/ paper, etc.

My point in all of this is that while automation is certainly here in the current workforce, it has not really had a major affect YET. Thus why no one has really made a fuss so far.

This will change if several thousand rideshare drivers are suddenly out of a job, or a majority of fast food workers are instantly unemployed. Political chaos will ensue, perhaps even riots. This is not just an Uber issue, but rest assured that Uber will be suddenly seen as an evil on par with skynet, or the Gestapo, and there will be no recourse from that kind of posion stigma that they will be left with.

As for accidents....

Again I would speculate that only one bad accident, (especially if children are involved), can unravel this behemoth. It doesn't matter if it's rational or justified, the media would love to sink it's teeth into a story about the dangers of autonomous vehicles, and the deadly carnage that they leave in their wake.

Hyperbole? Sure. But that won't stop what will now be a compounding political hassle.

Bottom line is this: However this plays out, I highly doubt this is going to be an uphill battle at best, and a nasty political football at worst, for Uber.


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## Jermin8r89 (Mar 10, 2016)

JesusisLord777 said:


> Again I would speculate that only one bad accident


Thats something good to think about. These things requare internet so what if a virus hits the internet? Its connected. Its gonna do major harm happens all the time. Which is y we always change passwords alot. If someoe makes 500 cars turn a left then it will. Humans is great counter act against major problems as 500 humans wont just be like what the hell im just gonna make a sharp left turn on this highway


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## JesusisLord777 (Dec 4, 2016)

Jermin8r89 said:


> Thats something good to think about. These things requare internet so what if a virus hits the internet? Its connected. Its gonna do major harm happens all the time. Which is y we always change passwords alot. If someoe makes 500 cars turn a left then it will. Humans is great counter act against major problems as 500 humans wont just be like what the hell im just gonna make a sharp left turn on this highway


That's a good point that I never thought about. If these things are thethered to the internet, then that could be a major vulnerability.


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## heynow321 (Sep 3, 2015)

lol doesn't ramz remind you of every charlatan from the tech bubble? Most of you may be too young to remember but back then everyone was predicting the demise of brick and mortar stores. Nobody would ever visit the mall again, everything was just going to be delivered to you, etc. Turns out they, of course, were all dead wrong. I beleive online retail JUST broke the 51% mark, almost 2 decades behind schedule. 

Until I see someone like Buffett get behind this SDC nonsense, maybe I'll give it a nod. Until then, relying on flash in the pan CEO's (whose fortunes depend on the suckers like ramz believing everything they say) will be a recipe for disaster (as it always is).


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