# Why Uber is doomed to fail....



## UberHammer (Dec 5, 2014)

*Why Uber is doomed to fail....
*
For the TL;DR crowd, Uber is going to fail because it is out of touch with the wants and needs of the customer it is targeting.

*People LOVE Uber. *You haven't used Uber yet? Here, use my code when you sign up. It's SO MUCH BETTER than a cab.

We've all heard the above. It's viral. And it's made Uber grow as a company as fast as very few in history have. But how Uber got where it is today, and where it is today, are not the same as where it is going.

Where a company is going is the burden of every CEO of a company. They are paid to have the vision of the future, the direction of where to go, and the path of how to get there. So what is Travis Kalanick's vision? What is his direction? What is his path?

Ignore what you've known about Uber. Ignore what you know about Uber. Because Uber is in a massive transition to win a completely different customer than those who made it what it is today.

In cities like New York and San Francisco, using Uber is cheaper than owning a car. But Uber doesn't deserve congratulations for figuring that out. Taxis have been in business doing exactly that for many decades now. The cost of parking a car you own in those cities is so astronomically high, it's always been cheaper to just take cabs, unless you are old enough to remember seeing Model Ts on the streets. Taxis being cheaper than owning a car has created a lifestyle in those cities, such that many residents don't even have a license to drive if they wanted to.

Uber is beating the taxis in New York and San Francisco. Uber didn't create that lifestyle, but it's making millions stealing that market away from taxis by providing a product that riders prefer. This is a classic example of free market capitalism working.

Uber copied their success in New York and San Francisco throughout the US and the world. And just like in New York and San Francisco Uber is beating the taxis in those cities too. But expanding to more cities is paltry growth to Uber's investors. Why? Because the lifestyles are different. People own cars. The use of cabs is limited to niche situations where driving doesn't make sense. Like going out on weekends to drink without a designated driver. As a result, the amount of taxi/Uber revenue in those cities is almost nothing compared to New York and San Francisco revenue. So despite beating the taxis in the rest of the US and world, Uber investors aren't satisfied. They want more growth than that. Where is it going to come from?

This is where Uber of the future is no longer the Uber of the past. In order for Uber to grow, using Uber MUST become cheaper than owning a car in EVERY city. So that is the vision. But what is the direction? What is the path?

Travis Kalanick's direction and path is nothing more than to drop the Uber rates over, and over, and over, and over, and over again, until the rates are so cheap that riding with Uber is cheaper than owning a car. Brilliant, right?

But if it's just that simple, then McDonalds should drop it's prices over, and over, and over, and over, and over again, until the prices are so cheap that dining with McDonalds is cheaper than owning food. Anyone with any business sense knows that McDonalds can't just continue dropping prices over and over again without eventually reaching their own costs of the food they're selling. So there is a limit to just how much McDonalds can do that.

But what is Uber's limit in dropping rates? What are their costs for rides?...... the answer is ZERO!!!! Uber is a ZERO cost business model for the actual rides given. All the costs of the rides belong to other businesses. Each Uber driver is an independent contractor to Uber. That means each driver is their own independent business. Their revenues are the fares, and their costs are the Uber commission and the costs of owning and operating their car.

So Uber, with a ZERO cost business model, could drop rates to $0.01 per mile, and still make positive revenue on every ride. So unlike McDonalds (and any other business that pays for the costs of the goods and services they provide) that would lose money if it dropped prices below a certain point, Uber experiences no such loss.

So, can Travis accomplish his goal of making Uber cheaper than owning a car? Yes... as long as drivers drive for that rate.

Well, no one would drive for Uber at a rate that's cheaper than what their car costs them, right?... The truth is it's not that black and white. Take for example, a pawn shop business... Where does a pawn shop get the goods it sells? From people selling the good for less than they bought it for. Why do people do that? Because they're in dire straights. Maybe they're unemployed. Maybe they're deep in debt. Maybe their kid is sick and they're underinsured. There are many, many, MANY reasons why people pawn their valuables.

And there will be many, many, MANY reasons why people drive for Uber, even after Travis drops rates below the cost of owning a car.

But what kind of customer will use Uber once Travis accomplishes that goal? In his mind, this is going to produce billions in revenue because people who have been spending billions on cars will instead spend those billions on Uber. But will they ditch car ownership for Uber riding just because it's cheaper? If we look at New York and San Francisco, they would be evidence that yes people would. But is that solid logic to reach that conclusion?

If people are looking for transportation that is cheaper than owning a car, then why do 90% of the models of cars available even sell? Why do minivans sell, when compacts are cheaper? Why do SUVs sell, when compacts are cheaper? Why are the best selling cars mid-sized and full sized, and not compacts? Why do pickup trucks sell so well? The answer to all of these is "LIFESTYLE"!!!!

Again, taking taxis/Uber in New York and San Francisco is a lifestyle... and more importantly it is a lifestyle that existed decades before Uber ever even became an idea. People's lifestyles outside of New York and San Francisco are DIFFERENT. Travis Kalanick's vision is to target these people with different lifestyles, but nothing he is offering with Uber matches their lifestyle.

Can the soccer mom ditch her minivan and use Uber instead? Can the salesperson who works on the road from their car ditch their mid-sized sedan and use Uber instead? Will the factory worker who gets free parking at the factory ditch his 4X4 truck and use Uber instead?

Ask any car salesman about selling cars, and you'll learn really quick just how off the mark Travis Kalanick's plan to grow Uber is. He offers very little for what car buyers want and need. Will the buyer of a Honda Fit who just commutes to and from work find Uber at prices cheaper than owning the Fit appealing. Sure he will. But not all Honda Fit owners do nothing but go to and from work. They have lives. Will Uber fit the lifestyle? That's a burden Travis has to meet, and he's doing nothing but offering cheap prices to meet it. Most car buyers pay more for cars for that car to meet the wants and needs of their lifestyle.

Sorry Travis, but even when you find thousands of drivers willing to pawn off their car's equity to drive for Uber, the growth you expect to come from this is still way out of your reach. If you're going to compete for the revenue of the car industry, you have to meet the wants and needs of car buyers. Being cheap isn't nearly enough.

And more importantly, by driving prices so low that only those in dire straights are willing to drive for Uber, you will disenfranchise those who made Uber what it is today. Your existing Uber customers aren't asking for cheaper prices. But by doing just that, you will provide them less quality then what they are used to now. They will reject you. You will lose them as customers, all in the pursuit of new customers you don't know how to win.


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## Actionjax (Oct 6, 2014)

Great Editorial. Just some things that you didn't discuss from a revenue and cost model since we are talking about McDonnalds and the logic is applied the same ways.

1) Volume is a factor in any business venture. McDonalds can sell you food lower than the cost of food because of volumes. When they buy Beef they can buy it at Half the cost because they buy so much. What changes in this model is when Supply dries up and costs go up. This hurts profits if they don't up the cost to the consumer. Uber will need to react in the same way.

2) Uber is not just rides for money. They also are in the Data collection business. And when fully realized that data can be worth Millions of income to municipalities who what data on their city. Also insurance companies who want to gauge potential high traffics areas in the city.

3) Cost of rides does not mean drivers will lose money overall. The volume is high and the profits will be lower. But long as there is a profit there will be people who will rate if it's worth for them. If supply dries up then Uber will need to adjust the rates to get more drivers.

Will Uber live long term. It's hard to tell. I think they have more issues with regulations with cities that can kill their expansion more than rates will. Governments may be slow to react but when they do they can write Uber out of business. And make them the same as a Taxi service. But it won't be the same model as you see it today. And Consumers may not see the cost benefit to want to use it any more.

Uber is a new company with an uncertain future at this point. I would never get into an IPO offering from them. But I have made mistakes before on not buying based on hype. But I invest on the long term. And that keeps me at a modest and safe return.


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## UberHammer (Dec 5, 2014)

Actionjax said:


> Great Editorial. Just some things that you didn't discuss from a revenue and cost model since we are talking about McDonnalds and the logic is applied the same ways.
> 
> 1) Volume is a factor in any business venture. McDonalds can sell you food lower than the cost of food because of volumes. When they buy Beef they can buy it at Half the cost because they buy so much. What changes in this model is when Supply dries up and costs go up. This hurts profits if they don't up the cost to the consumer. Uber will need to react in the same way.


If McDonalds had to buy beef one cow and one vendor at a time, it wouldn't have volume pricing. Uber gets ZERO volume pricing from its partners, because no drivers sell in volume. In fact, it's not even buying anything from drivers. It's just selling its software, lead generation, insurance and collection services to drivers. The cost of the ride is ZERO to Uber.



> 2) Uber is not just rides for money. They also are in the Data collection business. And when fully realized that data can be worth Millions of income to municipalities who what data on their city. Also insurance companies who want to gauge potential high traffics areas in the city.


Those municipalities can also make laws that are difficult for Uber. So if Uber tries to profit from selling that data to government, the corruption of governments will make Uber pay in the end.



> 3) Cost of rides does not mean drivers will lose money overall. The volume is high and the profits will be lower. But long as there is a profit there will be people who will rate if it's worth for them. If supply dries up then Uber will need to adjust the rates to get more drivers.


If the rate of Uber is cheaper than owning a car, then there is no profit driving for Uber anymore than there is in selling one's valuables to pawn shops. As long as pawn shops can operate, so will Uber at rates below the cost of owning a car.



> Will Uber live long term. It's hard to tell. I think they have more issues with regulations with cities that can kill their expansion more than rates will. Governments may be slow to react but when they do they can write Uber out of business. And make them the same as a Taxi service. But it won't be the same model as you see it today. And Consumers may not see the cost benefit to want to use it any more.
> 
> Uber is a new company with an uncertain future at this point. I would never get into an IPO offering from them. But I have made mistakes before on not buying based on hype. But I invest on the long term. And that keeps me at a modest and safe return.


By fail, I don't mean cease to exist. I mean it will become a fraction of it's $40 billion valuation. Unless you think a nationwide pawn shop company would be worth $40 billion, and I don't think it would.

That being said, Travis could change his vision, and not turn Uber into the car equity pawning business he's currently headed for. What it would be worth then would depend on his new vision. His current one is not worth $40 billion, despite all the hype.


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## Actionjax (Oct 6, 2014)

I think the introduction of UberPool is when the cost of riding will be lower than owning a car. It's the same model as Carpooling today. It may not be UberX that is what is being pushed as the primary driver of that. But UberPool will definitely push it that way.

Right now I am a wash doing a regular car pool with 2 persons splitting the cost of the drive. (In fact I still lose out as we are only splitting parking and Gas) The use of the vehicle and upkeep are mine alone and the rotation of cars is supposed to offset that. This is how most traditional car pools work. I still lose out but it's way better than being Solo in my car when it comes to expenses.

Uber brings that now to the rest of what I call empty cars on the road that come in to work every day with one person. (In Toronto it's around 80% of commuters) Now Uber can still make taking Uber cheaper than the cost of ownership for everyone with a good system in place. And they get the skim off the top. For most something back for little or no effort in organizing a ride is better than the commute all on it's own.

What you will see happen is poaching after the intro is made and then cutting out the middle man. That's what I would do if I found some good riders.

UberPool was one of the reasons I signed up. It's just not here yet and the feedback I have seen has kind of got me rethinking it a bit.


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## BlkGeep (Dec 7, 2014)

Liked the first sentence, the rest was too long to read, but I agree. The problem with Uber isn't the pax or the drivers, it's Uber. People absolutely love us. Too bad we aren't a transportation company. Sort of like Wal-Mart, they could be the best in the world, but they want to be the cheapest. We could be the best transportation company in the world, but our leader thinks it's better to be the cheapest, not sure he understands our customers.


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## UberHammer (Dec 5, 2014)

Actionjax said:


> I think the introduction of UberPool is when the cost of riding will be lower than owning a car. It's the same model as Carpooling today. It may not be UberX that is what is being pushed as the primary driver of that. But UberPool will definitely push it that way.


True. The question is will people pay to car pool, and if so, how much?

For those where car pooling works for them, they're probably already doing it, and cheaper than Uber can provide it for. It's also a carpool of people they know and trust, and not complete strangers like UberPool.

The math works out for UberPool. I just don't think the demand for it will be anything significant.


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## Berliner (Oct 29, 2014)

Actionjax said:


> I think the introduction of UberPool is when the cost of riding will be lower than owning a car. It's the same model as Carpooling today. It may not be UberX that is what is being pushed as the primary driver of that. But UberPool will definitely push it that way.


This in one side of the coin. The other side in big Cities is "time is money", and this is the main reason for taking an on-demand-ride. It makes no sence saving a few bucks and missing the flight.

UberPool make sence for drunken students in small towns. Have fun.

BTW: In my language "TK" is a shortcut for "deep froozen goods". Maybe that´s happend with the brain of the master of deasaster.


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## [email protected] (Feb 13, 2015)

Great thread! --

#My2cents...

UberPool or UberShuttle? Why not add Shuttle vans? Or the option to carry 3 for an UberPool? -- If Uber continues building contracts with companies for their workers to Uber in, why not set a location of each rider, and pair them up? Or triple them up? Uber could then take its high star drivers, and offer them a chance at the market they are ultimately trying to reach. Which is provide a professional service at a fair (however, Uber has now gone beyond fair) or better then market value.

Uber and Lyft are like comparing Burger King to Taco Bell. Yes, both are establishments that provide a source of food. Except the food is significantly different then the other. So why slash prices?

Since Uber is more White Collar, and Lyft more Blue Collar, Uber dominates in picking up the 9-5ers. These 9-5ers, in many cases during the morning's require silence. Laptop's, tablet's, phone's, or another moments rest. In the evening, after work- not so much. Still though, Uber dominates.

Lyft on the other hand is more directed towards the blue collar. A fist bump and a really happy welcoming is their culture. Since most 9-5ers are distracted, a fist bump and someone trotting around like a puppy wanting to play, will simply not do. So. Where is the market for Lyft? Since their culture is to greet you with a sense of excitement and playfulness- bars, clubs, any festivities of the sort would follow suite, making Lyft perfect for keeping the party alive.

So why on earth would you price war, when two companies offer two different foods?During the day, Taxi cabs run the city thanks to their own lanes from 10am-2/3pm when the lunch rush hour begins and ends. There's little money for Uber, and even less for Lyft. After 10pm, when people are ready to start their night, and usually go out, Lyft can and will dominate, once they figure out they sell just hamburgers and not Quesadillas. From 7pm till 12am, both can succeed. For some, its a club- loud and packed. While the other crowed, prefers a lounge and some degree of silence. From 12:01 am till closing, I'd leave the streets up to Lyft and the city yellows.

Who is Uber and Lyft really competing against? Certainly not each other when they realize both have different menu items. The real competition is those pesky yellow things bantering about the streets. Such havoic and lack of respect for themselves and others. Everything with in a 12 foot radius says dirty, smelly, loud, confusing, scary, concerning- the list goes on. Their menu is disgusting and unhealthy. Most of the items offered are not even worth walking into the front door. So, why are we having a price war? Our service slaughters theirs. This brings me to sidecar...

#aCommercial...

Uber gentleman is kicking back against his car, reading the New York times. Camera rolls by, driver looks up, smiles, gives a little nod and the camera moves on. Next scene, a lady Lyft driver is be-bop'n her head to some music looking into a crowd speaking out, "Who wants to have some fun!" Then the camera rolls back to the Uber gent, panning back down to the Lyft representer, and just before the camera zooms down a long hill to view the beautiful SF, a yellow cab driver rolls by with a cigarette between his lips, jolting carelessly through traffic while screaming profanities at traffic all the meanwhile you would see passengers holding on for their lives. Then the camera fades to black and the words "What's your ride going to be like today? -- Lyft-Uber. Well be here waiting. See you real soon!"

Since both companies have two perfect and different cultures to provide the people, and the yellow cab system is quickly loosing ground, selling your $25 lobster, to match a $4 frozen meal is completely senseless. All you have to do is educate the public why these systems were created, using stories that example why they are far superior then the yellow system, and people will gladly pay you for your service.

Now gimme a third rider for UberPool. Recognize you are a cat and not a dog. Raise the fares back up- and let's get back work.


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## UberHammer (Dec 5, 2014)

BlkGeep said:


> Liked the first sentence, the rest was too long to read,


Well, that was the whole intent of the TL;DR line.


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## uber_sea (Jan 9, 2015)

Excellent post. I'd link it to major news outlet and see if it gets some attention from investors.


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## chi1cabby (May 28, 2014)

UberHammer said:


> So Uber, with a ZERO cost business model, could drop rates to $0.01 per mile, and still make positive revenue on every ride.


I agree with your post. But I don't agree with the "Doomed To Fail" conclusion.
By continuously lowering rates, Uber is seeking the inflection point of the supply curve. When supply starts getting constrained due to rock bottom rates, Uber will stop lowering rates. And at the current rates, despite the Hourly Guarantees, Uber is having driver retention problems and difficulty signing-up New Drivers. Thus the change in Vehicle Age requirement:










Lower Rates not only mean increased demand, but also better cash flow for Uber. And with Lower Rates, there is a disproportionate increase in shorter rides. But thanx to $1/Ride SRF, this also increases Uber's Profit Margin.

Edit: I'd come across a post where Driver had graphed the increase in shorter rides after the rate cuts. If someone remembers that post/thread, please point me to it.
Thanx!


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## UberHammer (Dec 5, 2014)

chi1cabby said:


> I agree with your post. But I don't agree with the "Doomed To Fail" conclusion.
> By continuously lowering rates, Uber is seeking the inflection point of the supply curve. When supply starts getting constrained due to rock bottom rates, Uber will stop lowering rates. And at the current rates, despite the Hourly Guarantees, Uber is having driver retention problems and difficulty signing-up New Drivers. Thus the change in Vehicle Age requirement:
> 
> View attachment 5236
> ...


By fail, I don't mean cease to exist. I mean fail to maintain it's $40 billion valuation, which is all the investors care about. That $40 billion valuation is based on Kalanick telling investors that he can get Uber cheap enough to tap into the $500 billion new car sales market. He will fail to accomplish that because nothing he offers those buyers meets their needs except being cheaper. Customers looking for cheap transportation don't buy new cars. So he is going to fail to tap into that market. Which means Uber is only worth its share of the taxi market, which means its worth nowhere near $40 billion, unless you think the taxi industry is collectively worth $40 billion and Uber can own all of it.


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## Bart McCoy (Nov 4, 2014)

Uber cant drop the price per mile but so low
now currently the rates are 65cents to 75cents per mile in many markets
we all know you cant make any real money at that rate, yet there are dummies that still drive
the drivers cant be but SO dumb
like if Uber made it 25cents a mile and 5 cents a minute
the dummies will find out that its not worth it,even though they'll be in the red by the time they find out
so to get the cost for uber to be cheaper than owning a car, it would have to be between 1 to 10 cents per mile
even teh dumbest fool wont drive for that low rate

even if the rate somehow went to stupid 25cents/lower rates, it still doesnt beat the convience of having our own car

like i have a nice car, sometimes i just like to ride in it, give a custom system , custom look. not everybody wants to ride around in stock all day


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## chi1cabby (May 28, 2014)

UberHammer said:


> That $40 billion valuation is based on Kalanick telling investors that he can get Uber cheap enough to tap into the $500 billion new car sales market.


 Agreed! And Kalanick has openly said so.

__ https://twitter.com/i/web/status/563824061701435392











UberHammer said:


> He will fail to accomplish that because nothing he offers those buyers meets their needs except being cheaper.


 Mostly agree. At best Uber might be able to make a marginal impact on car ownership.



UberHammer said:


> Which means Uber is only worth its share of the taxi market, which means its worth nowhere near $40 billion, unless you think the taxi industry is collectively worth $40 billion and Uber can own all of it.


 US Taxi & Limo market is estimated to be $11 Billion per year.
Uber is trying to portray itself as the leading contender in On Demand Economy. But it's foray into On Demand Logistics, UberESSENTIALS in D.C., has been shuttered. 
https://uberpeople.net/threads/uber-essentials.11088/
Uber just launched UberEATS in Barcelona. But there is more to that story than meets the eye. Read this Twitter convo:

__ https://twitter.com/i/web/status/568751217003728896


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## uberguy_in_ct (Dec 29, 2014)

With rates continually falling, Uber will certainly lose all the drivers who are only doing this as a way to earn etra income as a part time job (which is probably 50% of current drivers). I sure the vast majority of people doing this this way are decent people who enjoy what they are doing and able to earn a little money doing it. But when it gets to the point where it is not at all cost effective, or actually costs more to deliver the service than is received in return, people is this position (myself included) will just turn off the app and forget about it. This will leave Uber to fill the vacancies with perhaps a less desirable level of driver. I can envision certain aspects of driving records and background checks being overlooked (although any incidents with that would be a PR nightmare). 5* service will certainly be a thing of the past, which, I have read, is the reason this company was founded. Cars will increasingly become unsafe because drivers are not receiving enough revenue to properly maintain their vehicles. I believe if this continues, cab companies have nothing to worry about because Uber's services are on a steep downward trend.


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## UberHammer (Dec 5, 2014)

Bart McCoy said:


> so to get the cost for uber to be cheaper than owning a car, it would have to be between 1 to 10 cents per mile
> even teh dumbest fool wont drive for that low rate


Pawn shop operations work BECAUSE they get their goods from people selling them for less than cost. People do that because they are in dire straights for cash and have to liquidate their assets. Uber will get drivers driving for less than car costs for the same reason. There's always a fraction of society in dire straights and needing to liquidate for cash.


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## uberguy_in_ct (Dec 29, 2014)

Bart McCoy said:


> Uber cant drop the price per mile but so low
> now currently the rates are 65cents to 75cents per mile in many markets
> we all know you cant make any real money at that rate, yet there are dummies that still drive
> the drivers cant be but SO dumb
> ...


You are correct, America has a car culture and people love their cars. People will not give up their cars because Uber is cheaper.


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## Bart McCoy (Nov 4, 2014)

UberHammer said:


> Pawn shop operations work BECAUSE they get their goods from people selling them for less than cost. People do that because they are in dire straights for cash and have to liquidate their assets. Uber will get drivers driving for less than car costs for the same reason. There's always a fraction of society in dire straights and needing to liquidate for cash.


i understand the comparison, but people take a loss on 1 or 2 items or so
plus not everybody sells them outright, some people do actually use it for a short term loan
plus a lot of stuff they pawned has drastically depreciated
people in general dont pawn everything single thing in life they own
plus even if they did, it would have to end (because they pawned everything)
not so if you driving for Uber
you'll always have the car for weeks and weeks to lose money on
you'll run out of items to pawn way before the people come to repo your car
or if its paid for its'll always be there to lose money with

so again i understand the pawn shop concept,but i really dont think its the same as driving for Uber for 25cents/mile
at that rate they would even be able to put gas in the car and Uber cant function if people gas their cars up


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## Bart McCoy (Nov 4, 2014)

uberguy_in_ct said:


> You are correct, America has a car culture and people love their cars. People will not give up their cars because Uber is cheaper.


Uber is great for goig to places where parking is tough and all that
but if you going to the local convience store or smaller trips,not everybody wants to wait around to get a driver not canceling because its too far to get to to drive a pax 5 blocks
some citizens...like me....just want to go when I want to go
me personally i hate waiting on other people

I will use uber when my car is in shop or getting worked on, or in time where its simply convient to take uber because i wont have to worry about my car being at whatever place I want to go.
that's about it

I lot of people who use uber simply dont have cars. so yeah, they'll even more likely never get a car if it drops to super record levels

But i just cant see people saying, I'm not going to buy a car because its Cheaper to use Uber for 30 years


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## UberHammer (Dec 5, 2014)

Bart McCoy said:


> i understand the comparison, but people take a loss on 1 or 2 items or so
> plus not everybody sells them outright, some people do actually use it for a short term loan
> plus a lot of stuff they pawned has drastically depreciated
> people in general dont pawn everything single thing in life they own
> ...


Uber will be a preferred avenue to these people because most people buy more car than they need. And by driving for Uber, even at rates less than what the car costs them, they don't really give up the asset. They just consume it much faster.


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## UberHammer (Dec 5, 2014)

chi1cabby said:


> Agreed! And Kalanick has openly said so.
> 
> __ https://twitter.com/i/web/status/563824061701435392
> View attachment 5237
> ...


I have no doubt the taxi industry is worth billions. Assuming the taxi industry is making 10% profit on that $11 billion per year, then if Uber wins 100% of the market then their earnings would be $1.1 billion. At $40 billion valuation, thats a 36.4 P/E ratio. Which isn't bad for a technology company that's constantly growing new technologies. But if all Uber is is a monopoly on the entire taxi industry, then it's really nothing more than a utility, and NO utilities have 36.4 P/Es. So to be worth $40 billion or more, Uber has to show it can do something more than monopolize the taxi industry. And while ideas of getting into the non-people delivery market isn't bad, it's got to prove it can do something there first. And so far it's attempts to do so have been huge failures. It's struggling to make a dent there, despite the potential.


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## getFubered (Feb 18, 2015)

Uber can and will make it cheaper than owning a car. Sort of.

Look at what happened since the rate drop and off peak guarantees gone. It surges literally 70% of the time. Effectively what has somewhat happened is that rather than quitting, myself and others only drive during surge. When they cut rates again in July (you know they will) the prices will be so low only the new hires will try to work at those rates and accept all trips etc. and it will continue to surge all the time. Uber still gets the win though because they can still advertise absurd min fares and cross town rates but also BS earn up to 1k/week on Craigslist. What it has or at least will become is a 2 minute auction for rides. It's not profitable to drive at $1/mile but waiting surges out is still going to allow me to do ok this week.


Like it's been said before, he's going to run uberx into the ground but that's ok because he's got black car and select. Those prices will drop too such that those drivers are making what x drivers should be making (at the very least) and ppl that want a "better" ride can pay for those and the awful campus kids, grocery shoppers and 5-block runs can pay bus fares for trashed '05 Kia's and a language barrier


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## Bart McCoy (Nov 4, 2014)

getFubered said:


> Uber can and will make it cheaper than owning a car. Sort of.
> 
> Look at what happened since the rate drop and off peak guarantees gone. It surges literally 70% of the time.


so exactly how is Uber cheap when you are paying more than cheap because of the surges?


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## getFubered (Feb 18, 2015)

Bart McCoy said:


> so exactly how is Uber cheap when you are paying more than cheap because of the surges?


It's not but you and I both know riders are generally dumb. Also they don't spend 8 hours a day monitoring the app like we do. They pop it open see the surge and although they may be unhappy, they still "think" of their uber experience as cheap. No semi-regular customer has avoided surge. Virtually statistically impossible. They just write it off as a one time thing, no big deal. The idea of super low fares with Uber is in their mind


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## Bart McCoy (Nov 4, 2014)

UberHammer said:


> Uber will be a preferred avenue to these people because most people buy more car than they need. And by driving for Uber, even at rates less than what the car costs them, they don't really give up the asset. They just consume it much faster.


you do know Uber completely fails though if regulation kicks in all over the US though right?
heck,they probably will lose the employee lawsuit
then how profit is the uber model when ever car has to have commericial insurance and get paid back for gas and other expenses?????????????


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## UberHammer (Dec 5, 2014)

Bart McCoy said:


> you do know Uber completely fails though if regulation kicks in all over the US though right?
> heck,they probably will lose the employee lawsuit
> then how profit is the uber model when ever car has to have commericial insurance and get paid back for gas and other expenses?????????????


Uber has lots of problems. This thread doesn't go into them all. There's a whole forum here to discuss them.

You are a person with a chip on your shoulder, looking to fight. I'm really close to putting you on ignore.


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## [email protected] (Feb 13, 2015)

that would suck. If we all needed commercial insurance- game over. :-(


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## chi1cabby (May 28, 2014)

Bart McCoy said:


> you do know Uber completely fails though if regulation kicks in all over the US though right?


Uber is fully regulated in NYC, yet it's thriving there.


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## UberHammer (Dec 5, 2014)

chi1cabby said:


> Uber is fully regulated in NYC, yet it's thriving there.


$2.15 per mile.


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## [email protected] (Feb 13, 2015)

Soooo, more surge pricing more often. I like it. -- this reminds me. Friday and Saturday nights in SF, Uber app fails terribly. :-( -- Uber still needs to add a driver/car profile in the rider app. They could implement the sidecar format. Yup. Be bomb, cause folks wanna shop people and cars.


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## Bart McCoy (Nov 4, 2014)

UberHammer said:


> . I'm really close to putting you on ignore.


Ask me do I care


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## Danz Haagen (Feb 11, 2015)

Yeah, a lot of pax complained to me that there is no (800) number to reach Uber...


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