# Uber told by investors to sell self-driving unit



## jocker12 (May 11, 2017)

Investors have told Uber Technologies Inc [UBER.UL] it would be wise to sell off its self-driving car unit after it racked up losses of $125 million to $200 million each quarter for the past 18 months, tech news site The Information reported on Wednesday, citing an unnamed person familiar with the issue.

Uber did not immediately respond to a Reuters request for comment.

Uber is due to release its second-quarter earnings to investors later on Wednesday.

https://www.reuters.com/article/us-...nformation-idUSKBN1L01JM?utm_source=applenews

After Uber just closed their self driving trucks division, they are facing another harsh reality based decision. They don't have enough investor money left to burn to make it to the next year, when they intend to go public.

This is so true - 
"Morningstar's narrative badly misrepresents the impact of Uber's autonomous car and flying car programs on its corporate value

Morningstar provides detailed arguments about Uber's long term potential to exploit businesses such as autonomous vehicles (AVs) and flying cars (Uber Elevate) but then totally excludes the cost of developing them from their valuation estimates. One might argue that these investments will increase the value that IPO investors will get (long-term potential greatly exceeding near-term costs) or that they will actually decrease Uber's value (the low probability of far-off returns doesn't justify the costs and risks), But it is unacceptable for Morningstar to claim a specific ($110 billion) Uber value while pretending none of these issues exist.

Morningstar defense of Uber's AV program rests on Dara Khosrowshahi's false claim that autonomous vehicles would allow Uber to reduce the price of rides by 60%.[12]Drivers do account for roughly 60% of the costs of a traditional taxi operation, but the introduction of autonomous vehicles would significantly increase other costs (vehicles, databases, communication links, machine leaning systems, vehicle planning and control systems, new safety/insurance models, etc).

More important, a shift to autonomous vehicles would also require Uber to become a highly-capital intensive business, since it could no longer push all the costs and risks of AVs onto its drivers. It is not clear whether Uber has the management skills or strengths appropriate to the challenges AV or flying car businesses would pose. Since Morningstar ignores the questions of what would be required to succeed in those businesses or how long it would take to determine who the competitive winners would be, it is impossible for a reader of this report to have any idea whether Uber's current investments make any sense.

Uber has openly acknowledged that Khosrowshahi's narrative is the primary driver of its AV and flying car investments. As one interview reported, "&#8230; working on flying cars is important to the Uber narrative, according toUber COO Barney Harford.. 'I think being able to demonstrate [to investors] that we are a company that is able to deliver multiple growth engines and is able to incubate and execute upon a few different opportunities, I think that's a really important story.'"[13]IPO narrative imperatives have led Uber to claim it can have flying cars in full revenue service within five years, a ludicrous claim given the immaturity of the technology, the huge public safety and infrastructure implications, and the well-established rigor of aviation regulatory requirements.[14]

Khosrowshahi has acknowledged that his original plan after joining the company was to cancel both programs given their huge cash drain and uncertain returns, but changed his mind once he recognized that the IPO pitch required giving investors the prospect of growth beyond ridesharing.[15]That narrative transforms Uber's rideshare ordering app into the gateway to all forms of urban transport, and transforms Uber into "..the Amazon for transportation."[16]

Lots of investors might be interested in investing in the "Amazon of transportation". But a good-faith valuation analysis of this opportunity would examine whether Uber's economics gave it the same potential to profitably expand across new transport modes that Amazon demonstrated when it expanded from bookselling into other ecommerce fields. Morningstar fails to provide that legitimate valuation analysis.

Morningstar's evasiveness here is designed to prevent its readers from understanding a fundamental contradiction in Uber's pursuit of a $100+ billion valuation. There are many things Uber could do to improve short term profitability, such as abandoning unprofitable overseas markets, eliminate spending on AVs and flying cars, but all of them would directly undermine their long-term growth narrative. Hypothetically, one could show strong 2018-19 P&L improvements, or one could show the investments Uber thinks will be required to become the "Amazon of transportation" but under no circumstances could one show both."

https://www.nakedcapitalism.com/201...er-analysis-preview-ubers-ipo-propsectus.html


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## iheartuber (Oct 31, 2015)

But... but....

I thought uber was telling their investors that once they get all their cars to be driverless that’s when the real money is going to pour in??


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## everythingsuber (Sep 29, 2015)

iheartuber said:


> But... but....
> 
> I thought uber was telling their investors that once they get all their cars to be driverless that's when the real money is going to pour in??


It's flying cars dude. Autonomous vehicles are yesterday man. Get with it we are going to rule the skies. That's where the real money is.

Now just sign here and hand over your cash.


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## BurgerTiime (Jun 22, 2015)




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## DustyToad (Jan 10, 2018)

This confirms it. Uber is dying and the new surge system seen around the country is Uber in death throws. 

They killed surge so they could take more for themselves. 
The price the rider hasn’t changed. 
They still pay extra when demand is high. 
The change is they don’t pay the drivers more... or very little more then a regular nonsurge ride.


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## iheartuber (Oct 31, 2015)

Here’s what I don’t understand: they know what demand is in a market. They know how many drivers they need to meet that demand. Just cap the drivers, have the pax pay slightly more and that’s it. The pax doesn’t pay too much, the driver gets a fair wage, and that’s that. Freaking idiots man


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## jocker12 (May 11, 2017)

iheartuber said:


> Here's what I don't understand: they know what demand is in a market. They know how many drivers they need to meet that demand. Just cap the drivers, have the pax pay slightly more and that's it. The pax doesn't pay too much, the driver gets a fair wage, and that's that. Freaking idiots man


In order to cover the demand you need to make sure the needed drivers are online, and they cannot control that.

They need to raise the rates and let the drivers compete.

Capping works when you have control over the schedule and location.


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## London Tube (Aug 14, 2018)

DustyChode said:


> This confirms it. Uber is dying and the new surge system seen around the country is Uber in death throws.
> 
> They killed surge so they could take more for themselves.
> The price the rider hasn't changed.
> ...


Exactly right. Sadiq Khan is putting the screws to Uber here in London and NY is doing the same. The new surge is a desperation move. Without the promise of robot cars investors see no light at the end of the tunnel. This could go very badly very quickly.


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## iheartuber (Oct 31, 2015)

jocker12 said:


> In order to cover the demand you need to make sure the needed drivers are online, and they cannot control that.
> 
> They need to raise the rates and let the drivers compete.
> 
> Capping works when you have control over the schedule and location.


I think that if drivers were capped and rates were high enough so that every ride was a fair wage to the driver and surges were no longer needed, each driver can basically work anywhere and still make good money. You won't need to see all the drivers descend on the hot spots


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## goneubering (Aug 17, 2017)

iheartuber said:


> I think that if drivers were capped and rates were high enough so that every ride was a fair wage to the driver and surges were no longer needed, each driver can basically work anywhere and still make good money. You won't need to see all the drivers descend on the hot spots


But that will never happen in most markets.


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## iheartuber (Oct 31, 2015)

goneubering said:


> But that will never happen in most markets.


It should

But you're right... it probably won't


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## jocker12 (May 11, 2017)

iheartuber said:


> I think that if drivers were capped and rates were high enough so that every ride was a fair wage to the driver and surges were no longer needed, each driver can basically work anywhere and still make good money. You won't need to see all the drivers descend on the hot spots


Yes, but demand could be elastic and Uber needs to be able to enforce schedule and control fleet to make sure, with a non elastic number of drivers, will be able to cover that demand they know about but have no control over.

With unlimited number of drivers, once the rates make sense, you just let them compete and the quality wins, everybody's happy.


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## iheartuber (Oct 31, 2015)

jocker12 said:


> Uber needs to be able to enforce schedule and control fleet to make sure, with a non elastic number of drivers, will be able to cover that demand
> .


I thought that's what the free market was all about? No need to control the drivers. Just let them run free. If they're so dumb they can't figure out where the hotspots are and they end up in a suburb that's deader than Elvis then just let the areas that are low on cars surge up and attract the drivers from 2 streets over.


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## jocker12 (May 11, 2017)

iheartuber said:


> I thought that's what the free market was all about? No need to control the drivers. Just let them run free. If they're so dumb they can't figure out where the hotspots are and they end up in a suburb that's deader than Elvis then just let the areas that are low on cars surge up and attract the drivers from 2 streets over.


I agree, but by capping their numbers Uber can hurt its business model and have riders irritated they cannot have service because there are no drivers available or not smart enough to understand and react to the moment.

The sad reality is that a vast number of drivers are clueless and expect money to start pouring on them the moment they start driving their cars.

Uber knows that and, in order to provide the service to the riders (and get the money out of their clients pockets) needs many drivers flooding the streets or needs control over a capped number, to tell them when and where to do the driving.

They need to be effective and avoid leaving money on the table because the drivers are absent or clueless.


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## Stevie The magic Unicorn (Apr 3, 2018)

Putting caps on the number of vehicles in an area is a double edged sword.

The "popular" companies end up thriving, the companies with fewer vehicles struggle in comparison and certain areas end up being poorly served.

Your looking at the age old problem with taxis like has always existed with taxis.

And higher rates will kill the demand because people won't be able to afford it anymore.

Areas of lower demand won't get served compared to areas of higher demand, more fares per hour = more money.
Real hard math to figure out..

Around here, the areas that get the worst cab service aren't the poorest areas, they are the areas with the least demand.

For instance i can clear about 10 times the revenue going to _Crime Hills_ than i can in Lake Mary.

Most of the time Pine hills is about 15 minute response time, from the big cab company that reliably dispatches county wide.

Lake Mary is 20-30 minutes wait time for an airport run and an hour if your lucky going anywhere else.



















OK it's actually Pine Hills but if i say "crime hills" to the locals around here they will get it.

Right now uber and lyft have so many sticking drivers out there and the rates are so far below cost that the entire house of cards is being propped up.

You start paying the drivers fairly and cap the number of vehicles?

Game over!

Which is why i want to see it happen..

MUAHHAHAHHAH!


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## jocker12 (May 11, 2017)

Stevie The magic Unicorn said:


> And higher rates will kill the demand because people won't be able to afford it anymore.


No they won't. This is what Uber wants driers to believe in order to give up pushing for higher rates. It will probably be a 20% decrease easily balanced by the rate difference increase. Remember, you want a quality service, not quantity. When Uber says more riders more money, they treat you like a donkey. You need to work smarter not longer.



Stevie The magic Unicorn said:


> more fares per hour = more money


I disagree.



Stevie The magic Unicorn said:


> You start paying the drivers fairly and cap the number of vehicles?
> 
> Game over!


Cities can enforce that, if they will have traffic congestion problems, but Uber could give experienced drivers with good ratings priority to higher revenue opportunities.

Drivers are not equal. Some of them are driving for 5 or 6 years now, some only for 5 or 6 months. Some stay above 5.90 ratings, some cannot get higher that 5.75. 96% of the drivers are not driving anymore after their first year on the platforms.

I am sure, at Uber corporate headquarters, an intern makes less money than a 4 years employee, or a high performance engineer expects more than any average level engineer. It should be the same with the drivers. Uber needs to reward performance and quality, and stop pretending drivers are equal, because they are not. By alienating the experienced drivers, Uber will show everybody, including the riders, they don't care about changing the culture, about valuing individual performance, work ethics and customer service.

If they respect the drivers, those drivers will be the force to fight for Uber existence if that will be threaten. Same with Lyft or any other company or corporation.


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## goneubering (Aug 17, 2017)

jocker12 said:


> Investors have told Uber Technologies Inc [UBER.UL] it would be wise to sell off its self-driving car unit after it racked up losses of $125 million to $200 million each quarter for the past 18 months, tech news site The Information reported on Wednesday, citing an unnamed person familiar with the issue.
> 
> Uber did not immediately respond to a Reuters request for comment.
> 
> ...


Dara says he's not selling. He thinks Uber's sdc division has value. I think it's a nightmare.

https://www.msn.com/en-us/news/tech...ing-car-division/ar-BBMVq9J?OCID=ansmsnnews11

*Uber doesn't plan to sell its self-driving car division*


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## tohunt4me (Nov 23, 2015)

goneubering said:


> Dara says he's not selling. He thinks Uber's sdc division has value. I think it's a nightmare.
> 
> https://www.msn.com/en-us/news/tech...ing-car-division/ar-BBMVq9J?OCID=ansmsnnews11
> 
> *Uber doesn't plan to sell its self-driving car division*


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## Stevie The magic Unicorn (Apr 3, 2018)

I figured it out...

Corporate is giving the SDV engineers jobs, with the promise they kick back $100 cash each week.. and they get paid to play with Robots cars.... then when the gig is up they have safes full of pilfered investor cash...


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## jocker12 (May 11, 2017)

goneubering said:


> Dara says he's not selling. He thinks Uber's sdc division has value. I think it's a nightmare.
> 
> https://www.msn.com/en-us/news/tech...ing-car-division/ar-BBMVq9J?OCID=ansmsnnews11
> 
> *Uber doesn't plan to sell its self-driving car division*


I don't think Uber has much to say anymore when it comes to its self driving cars unit.

It is hard for me to believe Dara, hired by the Board of Directors (more correctly "Board of Investors") to listen and deliver the IPO at $110 billion valuation. Dara is not there to convince them they are wrong when they say "sell the SDC unit".

If the initial reporting was accurate (and there is no reason to believe was not), either Uber says Toyota is "partner" when actually is the new "owner" of ATG (Advanced Technologies Group), or Dara lost his mind and is telling the very people that hired him how they are dead wrong about self driving cars potential and financials.

Either way, Dara is denying the reality and the truth.


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## iheartuber (Oct 31, 2015)

jocker12 said:


> I don't think Uber has much to say anymore when it comes to its self driving cars unit.
> 
> It is hard for me to believe Dara, hired by the Board of Directors (more correctly "Board of Investors") to listen and deliver the IPO at $110 billion valuation. Dara is not there to convince them they are wrong when they say "sell the SDC unit".
> 
> ...


Dara will do whatever Dara has to do to get an IPO. If he has to lie, distort reality, whatever... he will do it


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## jocker12 (May 11, 2017)

iheartuber said:


> Dara will do whatever Dara has to do to get an IPO. If he has to lie, distort reality, whatever... he will do it


Uber is only investors money. If they went out telling him to sell, instead of letting him to do the job they hired him to do, he will be obligated to do what they told him to do, and not what he wants to do.

With their money he does what they say, with his money.... I wish him good luck.

Lying is for the public.


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## heynow321 (Sep 3, 2015)

someone somewhere else astutely pointed out that tesla is being valued as a tech company and NOT an auto manufacturer. B/c of this stupidity, tesla trades at a ridiculously overvalued premium. Dara realized he needs to keep the facade of SDC's and "flying taxis" despite the ludicrous nature of these fantasy ventures. 

by keeping that crap alive, he can look at you in the eyes and say with confidence "boober is a tech company! look at all this tech we're working on!". As any veteran driver here knows (or anyone with an IQ above 100), boober is nothing but a taxi company with misclassified employees. By fraudulently claiming to be a "tech" company, they're hoping to enjoy the same premium and overvaluation that tesla currently does. that's why dumbasses like tomato and the fat man like to throw meaningless big numbers around like "the SDC market is worth $6 trillion!". 

time will ultimately undo boober of course but it sure has been fun watching the drama of this slow trainwreck.


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## jocker12 (May 11, 2017)

*Update*: The deal is official. As expected, Toyota confirmed it will invest $500 million in Uber, and said in a press release that "This agreement and investment marks an important milestone in our transformation to a mobility company as we help provide a path for safe and secure expansion of mobility services like ride-sharing that includes Toyota vehicles and technologies." Uber CEO Dara Khosrowshahi said "Our goal is to deploy the world's safest self-driving cars on the Uber network, and this agreement is another significant step towards making that a reality. Uber's advanced technology and Toyota's commitment to safety and its renowned manufacturing prowess make this partnership a natural fit. I look forward to seeing what our teams accomplish together."

Specifically, their agreement will create an "Autono-MaaS" (autonomous-mobility as a service) fleet based on Toyota's Sienna minivan. Using Uber's self-driving tech and Toyota's Guardian system, they claim it will enhance vehicle safety. It sounds like a better plan than Uber''s previous test with Volvo, where enabling its self-driving tech meant disabling built-in assists that could have helped avoid a crash like the one that killed a pedestrian. The plan is to start "pilot-scale" *deployments on Uber's network in 2021*.

https://www.engadget.com/2018/08/27/toyota-invest-500-million-in-uber/

And this - https://finance.yahoo.com/news/why-toyota-over-uber-044159662.html


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## jocker12 (May 11, 2017)

Selling to or partnering with a car manufacturer on self driving cars was an idea Uber debated over a year ago... or I should say, over a Billion dollars ago, even before they've named Dara as a new CEO... - Aug 22, 2017 - Uber said to have considered automaker joint ventures for self-driving


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## goneubering (Aug 17, 2017)

jocker12 said:


> *Update*: The deal is official. As expected, Toyota confirmed it will invest $500 million in Uber, and said in a press release that "This agreement and investment marks an important milestone in our transformation to a mobility company as we help provide a path for safe and secure expansion of mobility services like ride-sharing that includes Toyota vehicles and technologies." Uber CEO Dara Khosrowshahi said "Our goal is to deploy the world's safest self-driving cars on the Uber network, and this agreement is another significant step towards making that a reality. Uber's advanced technology and Toyota's commitment to safety and its renowned manufacturing prowess make this partnership a natural fit. I look forward to seeing what our teams accomplish together."
> 
> Specifically, their agreement will create an "Autono-MaaS" (autonomous-mobility as a service) fleet based on Toyota's Sienna minivan. Using Uber's self-driving tech and Toyota's Guardian system, they claim it will enhance vehicle safety. It sounds like a better plan than Uber''s previous test with Volvo, where enabling its self-driving tech meant disabling built-in assists that could have helped avoid a crash like the one that killed a pedestrian. The plan is to start "pilot-scale" *deployments on Uber's network in 2021*.
> 
> ...


There are NO safe SDCs on the market at this time in my opinion. I predict Toyota will regret this partnership.


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## jocker12 (May 11, 2017)

goneubering said:


> There are NO safe SDCs on the market at this time in my opinion. I predict Toyota will regret this partnership.


Now for the record - Four years ago "Car manufacturer Toyota has agreed to pay a staggering $1.2 billion to avoid prosecution for covering up severe safety problems with "unintended acceleration," according to court documents, and continuing to make cars with parts the FBI said Toyota "knew were deadly."A deferred prosecution agreement, forced Toyota to "admit" that it "*misled U.S. consumers* by concealing and making deceptive statements about two safety related issues affecting its vehicles, each of which caused a type of unintended acceleration.

Toyota "put sales over safety and profit over principle," according to FBI Assistant Director George Venizelos." 
https://abcnews.go.com/Blotter/toyo...dly-unintended-acceleration/story?id=22972214

What do you expect from Toyota? Faulty Uber technology seems to be a perfect fit for them.


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## iheartuber (Oct 31, 2015)

jocker12 said:


> Now for the record - Four years ago "Car manufacturer Toyota has agreed to pay a staggering $1.2 billion to avoid prosecution for covering up severe safety problems with "unintended acceleration," according to court documents, and continuing to make cars with parts the FBI said Toyota "knew were deadly."A deferred prosecution agreement, forced Toyota to "admit" that it "*misled U.S. consumers* by concealing and making deceptive statements about two safety related issues affecting its vehicles, each of which caused a type of unintended acceleration.
> 
> Toyota "put sales over safety and profit over principle," according to FBI Assistant Director George Venizelos."
> https://abcnews.go.com/Blotter/toyo...dly-unintended-acceleration/story?id=22972214
> ...


Do you think Toyota signed up for this so that they would get a bunch of gunuea pigs (aka pax) to test out their SDCs?


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## jocker12 (May 11, 2017)

iheartuber said:


> Do you think Toyota signed up for this so that they would get a bunch of gunuea pigs (aka pax) to test out their SDCs?


I think if the technology is deployed as it is today (and there are no signs it'll get better) , with no human monitors to cover up for unavoidable software errors, more innocent people will die.

And ALL the developers know it.

As long as those human monitors are inside the moving self driving cars, clearly those cars are not safe.

The conflicting paradox is the companies and the authorities insisting to have and keep those humans inside the cars for SAFETY. Who would've thought those so many errors making humans will actually provide a safety net for those so perfect to be robots...


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