The 'Ugly' side of Uber

Ubermikein

Member
From Nasdaq


Logically, Uber's whole business plan depends entirely on people driving for them. It's a very simple process, and as long as you are over 21, can pass a criminal background check, and have a relatively new car, you could become an Uber driver too.

So far, Uber's driver pool seems to be growing at a similar rate to its customer base. However, it looks like the tide could be changing, and if Uber starts struggling to attract drivers, things could get ugly.

Take a look at San Francisco, the birthplace and headquarters of Uber. As The Street points out, the rate of taxi license applications in San Francisco is now higher than it was prior to Uber's debut in 2010. This is after Uber caused license applications to drop by 50% in just two years. On top of that, research now suggests that Uber drivers don't actually make more money than their taxi-driving counterparts.

Furthermore, a study released by Uber itself shows that the company's driver retention rate is not impressive. Just one year after becoming an active Uber driver, only about 50% of users are still around. (My take, simple economics, you run out of drivers).

A lack of drivers can cause serious issues for Uber and cut into its unique market share. In New York City, we are already seeing a similar effect. According to more research from The Street, there are about 20,000 registered Uber drivers in NYC. Out of that pool, an average of less than 2,000 Uber cars operated in the city center during the peak hours between 7 a.m. and 7 p.m.

To put that into better context, less than 10% of Uber drivers were active and working in New York City's business district, even in an area known as the "Exclusion Zone," where taxis are restricted access. It is not a good sign for Uber to be pulling such small numbers in a space where they have such low competition.

The only people making real money is the CEO and his henchmen. I bet they are out of business in 3 years. They are losing a ton of money (financials leaked)
 

Another Uber Driver

Well-Known Member
Moderator
From Nasdaq
While I do like the article and what it has to state, you might want to cite the author, date and specific media in which this was published. In fact, if you have a link to this, you might want to post it.

If you can provide all of the above, especially the link, this might go better on the NEWS Boards than advice. If you will be so good as to post the information and link, I will ask the Administrators to move it to the NEWS Boards.

In fact, if you take a peek at the NEWS Boards and the instructions for posting there...........

Thank you for the article, still.
 

Atom guy

Well-Known Member
The concept is sound, but not unique. Any taxi company could copy the app idea easily. Uber needs to get some business sense before the run themselves into the ground. Then all Travis will have is whatever money he gets selling the Uber name.
 

Ubermikein

Member
  • Thread Starter Thread Starter
  • #7
Uber is under water financially in a big way and they believe that digging into the partners driver pockets will help. First it not unusual for a startup to be under water financially, however cutting rates as much as 44% over 18 months is not a sustainable business model. They will run out of drivers . Drivers that can pass a background and driving record check and the news will and is getting out that it is not the money making endeavor that Uber espouses
 
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