# What is the endgame for Uber? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [August 28, 2018, 2:31pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407 "2018-08-28T14:31:39Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![dtilque](https://avatars.discourse-cdn.com/v4/letter/d/d6d6ee/32.png) [@dtilque](https://boards.straightdope.com/u/dtilque)\ **Post date:** [September 4, 2018, 3:57pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/61 "2018-09-04T15:57:03Z")
> [@Cheesesteak](#): > > Right now, my personal car is idle, sitting in a parking lot, an asset unused. If it could drive itself and pickup fares, at a profit, why wouldn’t I (and millions of other car owners) let it drive around town making me money? It sounds attractive at first blush that you can sit back and let Uber find the customers and you just collect money. But there’s lots more work to be done and either you have to do it or hire someone else to do it. For example, the inside cleaning thing. After every customer, someone has to inspect the car to make sure it’s clean enough for the next one. Now that could probably be done remotely via cameras, but someone still has to do it. And if it does need cleaning, the car has be taken out of service and go to either your house or a cleaning facility. Uber will probably do all this for you, but they’ll want a bigger cut of the money. There’s also general wear and tear on the vehicle. More kilometers on the car, so there will be greater repair bills and you’ll have to buy a new one sooner than otherwise. Higher insurance premiums too. And more inconvenience for you, since there’s a greater chance it’ll be in the shop when you need it. The combination of these things probably means that you’re making very little money in the long run. Many people will probably not want to bother with it. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [September 4, 2018, 4:09pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/62 "2018-09-04T16:09:02Z")
> [@kaylasdad99](#): > > Disclaimer: I consider myself to be WAY out of my depth in this discussion although I’m finding the parts that I can follow to be fascinating. That said, it may be worth noting that Russia, China, and SE Asia are qualitatively more authoritarian environments than the US and EU. A disinterest in “reinventing the wheel” in such environments could account for their willingness to let somebody else take on the task and expense of making the regulatory landscape navigable. > > ETA: and if it’s easy to copy, they might have an easier time inserting themselves once the way was cleared. Yep. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [September 4, 2018, 4:19pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/63 "2018-09-04T16:19:55Z")
> [@Cheesesteak](#): > > I think msmith537 has the right take on this. Uber is positioning themselves to be a market leader, THE name in rideshare services, for a time when the automotive transportation industry is in great flux. Automotive transport is being disrupted by rideshare and self driving technologies, both of which are going to stir things up. When the dust settles Uber wants to be leading whatever market remains, almost certainly a form of driverless car for hire. > > The $64,000 question is whether driverless car for hire replaces personal car ownership, or merely supplements it the way hired cars do today. Right now, my personal car is idle, sitting in a parking lot, an asset unused. If it could drive itself and pickup fares, at a profit, why wouldn’t I (and millions of other car owners) let it drive around town making me money? Would I even need to be a 2 car family if there was a vast network of driverless for hire cars to take my spouse when I have the car? The combination of self drive and rideshare technologies has the potential to alter the very concept of car ownership, and Uber is looking to be there. I think its far too early in the technology cycle, and Uber has made some big missteps - its a huge jump from where they are to getting to be the leader with self driving cars - and its going to take a huge investment for them to do so - which is going to take a lot of investor confidence for a firm that has proven to have gotten itself in deep legal and PR doo doo. At one time Blackberry had the business phone market tied up. Then the iPhone came along and looked unbeatable. And now Android phones hold 85% of the global market share. (And Tesla’s inability to scale is certainly not going to help Uber in attracting capital) ---
**Author:** ![bump](https://avatars.discourse-cdn.com/v4/letter/b/7c8e57/32.png) [@bump](https://boards.straightdope.com/u/bump)\ **Post date:** [September 4, 2018, 4:22pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/64 "2018-09-04T16:22:26Z")
> [@msmith537](#): > > As for “competitors”, other that Lyft (which is much smaller) and local taxis, who competes with Uber? To be successful in this business requires a large, global (or at least national) network of drivers. People don’t want 15 different apps to summon a car and the market can’t support it anyway. > > I think the big question for Uber is 'what does the future of “self driving cars” do to their business model?. I have a feeling that they’re building up a large data store that they’ll be able to eventually use to best position their self-driving cars so that they’ll be better positioned than their competition to pick up fares faster. That’s the main way I can see them being successful in the market changed by self-driving cars; otherwise it becomes a combination of marketing and fleet management, neither of which is their stock-in-trade. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [September 4, 2018, 4:37pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/65 "2018-09-04T16:37:34Z")
> [@bump](#): > > I have a feeling that they’re building up a large data store that they’ll be able to eventually use to best position their self-driving cars so that they’ll be better positioned than their competition to pick up fares faster. > > That’s the main way I can see them being successful in the market changed by self-driving cars; otherwise it becomes a combination of marketing and fleet management, neither of which is their stock-in-trade. If you want the data on who goes where when, Google already has a ton of it through Maps and Waze. ---
**Author:** ![Cheesesteak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cheesesteak/32/3694_2.png) [@Cheesesteak](https://boards.straightdope.com/u/Cheesesteak)\ **Post date:** [September 4, 2018, 4:39pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/66 "2018-09-04T16:39:43Z")
> [@dtilque](#): > > It sounds attractive at first blush that you can sit back and let Uber find the customers and you just collect money. But there’s lots more work to be done and either you have to do it or hire someone else to do it. All of this stuff needs to be done today with human driven Uber/Taxi. Self driving takes out the whole “I have to spend my whole day in the car” aspect of car for hire services. If the income per mile is a reasonable net positive, after accounting for gas/insurance/repairs/depreciation, then that’s money in my pocket for choosing YES on Uber. Now it’s just a matter of supply & demand. ---
**Author:** ![dtilque](https://avatars.discourse-cdn.com/v4/letter/d/d6d6ee/32.png) [@dtilque](https://boards.straightdope.com/u/dtilque)\ **Post date:** [September 4, 2018, 5:50pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/67 "2018-09-04T17:50:49Z")
> [@Cheesesteak](#): > > All of this stuff needs to be done today with human driven Uber/Taxi. True and many (probably most) of those Uber drivers are not really making as much money as they think. They don’t factor in increased repair costs and depreciation (especially depreciation, which is a mostly invisible cost). Also, most probably don’t have the right insurance for cars used in a business, so they’re cheating there. Eventually that may catch up to them. As for cleaning, customers are going to be less careful not to leave a mess when there’s no driver to keep an eye on them. That’s just human nature. So the cleaning costs will be higher. Also, a driver can do the clean up right away without having to take the car out of service for extended periods of time. I’m not saying that no one is going to do this, but probably no more than do it now. ---
**Author:** ![DCnDC](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dcndc/32/2842_2.png) [@DCnDC](https://boards.straightdope.com/u/DCnDC)\ **Post date:** [April 1, 2019, 4:57pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/68 "2019-04-01T16:57:21Z")
In news that’s surely encouraging for Uber investors, Lyft went public this morning, and so far [it has not gone well](https://jalopnik.com/investors-are-already-dumping-lyft-1833715242). > [@](#): > > Lyft, the mobility company that doesn’t have a viable business model and has never made a profit, opened trading as a public company Monday for the first time and investors promptly dumped shares, lowing the company’s stock value below its IPO price of $72 per share. ---
**Author:** ![Grestarian](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/grestarian/32/3227_2.png) [@Grestarian](https://boards.straightdope.com/u/Grestarian)\ **Post date:** [April 2, 2019, 12:31am UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/69 "2019-04-02T00:31:29Z")
> [@phreesh](#): > > Here’s what I see. I own a car. My wife owns a car. Pretty soon, my teenager will also have a car. I need to pay for insurance and gas and maintenance and loans on all those vehicles. > > A reliable, on-demand transportation company would remove all those costs. If their costs are below mine and the service was excellent, me and my family will never own cars again and would instead spend that money on a car service. > > A car service that had millions of customers like me would be worth a huge amount of money. > [@Voyager](#): > > The problem with that is this. Most cars are only driven a few hours a day. But they are the same damn hours. No company can afford to have the number of cars/drivers necessary to get people to work for long commutes and then stand idle most of the rest of the day. Given that you need a car to get to work, you also have it for errands. > > If we had good enough public transportation so that most commutes are done on it, giving up cars makes a lot more sense. New Yorkers have mostly used public transportation and rented for long trips for ages. Well, that’s my question and perhaps it’s a slight hijack: How does that work in New York or Chicago or Tokyo or London? Granted, there’s clearly a threshold, a tipping-point at which it makes sense to just skip buying a car and rely on a Taxi whenever/wherever you want to go and there’s a lot of places where Uber has willing drivers with cars while Yellow Cab has no local medallion-holders. But in a place like NYC, what percentage of the population simply has no personal car and takes a cab absolutely everywhere? In such a city, what’s the percentage who simply take mass transit and skip both cars and cabs? > [@Cheesesteak](#): > > The $64,000 question is whether driverless car for hire replaces personal car ownership, or merely supplements it the way hired cars do today. Right now, my personal car is idle, sitting in a parking lot, an asset unused. If it could drive itself and pickup fares, at a profit, why wouldn’t I (and millions of other car owners) let it drive around town making me money? You and hundreds, maybe thousands of other driverless car owners might be able to do that. However, local markets are what they are: When you’re at home sleeping and your car is available to freelance, most of the rest of your neighbors are also asleep; they don’t need a driverless ride, either. During the middle of the day when you’re busy at the office, more than 50% of your cohorts are also busy at the office rather than, for instance, skipping work to visit doctors and run errands all day. > [@Cheesesteak](#): > > Would I even need to be a 2 car family if there was a vast network of driverless for hire cars to take my spouse when I have the car? The combination of self drive and rideshare technologies has the potential to alter the very concept of car ownership, and Uber is looking to be there. That’s a very important point. Somehow I could imagine the car manufacturers and car insurance companies wanting this grand plan to fail. After all, it would mean fewer people need to buy their product. > [@Stranger\_On\_A\_Train](#): > > And they’ve been successful at this because their pre-existing competition, taxi services, are frankly awful even if you live in a major metropolitan area where they are prevelant enough to be no more than moderately inconvenient. It isn’t a viable plan long term against competition without some pretty radical changes. > > Stranger What I’ve always been wondering is why the “air taxi” model (we had a thread about it here a couple years back) was squished and yet the ground taxi replacement model is still thriving. In our earlier discussion, we were noting that commercial pilots have more training and flying hours than the neighbor-with-a-Cessna-and-training. Similarly, I fully expect professional taxi drivers to know\* the areas they drive in, including the shortcuts and the congestion times and alternate routes, et cetera and I still don’t expect a stranger-with-a-GPS to know those subtleties even in the area he stakes out most often. I also expect a company like Yellow Cab to keep up on vehicle maintenance better# than a stranger-with-a-license who is just driving for extra spending-cash and wouldn’t want something stupid like fresh brake-pads to eat into his Movie Money. - We saw the error of that assumption when taking a cab from the L.A. Forum back to the hotel. The cabbie was just pulling in a few extra bucks at the concert that night and selected the right hotel branch at the wrong location and it wasn’t until he started down the freeway ramp that we realized he was heading for the wrong destination. #Okay, so maybe I watched too much Judd Hirsch and Andy Kaufman as a kid – Marilu Henner was nice to look at! > [@Tired\_and\_Cranky](#): > > There is no reason that Uber will have to own fleets. Their business today is connecting car owners who want to drive with passengers. In the driverless future, it will be connecting car owners who don’t have to drive with passengers. > > This latter business is actually much simpler for Uber than their business today. They can deal with a smaller number of driverless car owners who own multiple cars and they don’t have to worry about driver screening. This seems to be assuming that, as someone above noted, the car owners are going to eat their maintenance costs. I suppose it’s a fair enough assumption since it’s working (more or less) now. > [@dtilque](#): > > There’s also general wear and tear on the vehicle. More kilometers on the car, so there will be greater repair bills and you’ll have to buy a new one sooner than otherwise. Higher insurance premiums too. And more inconvenience for you, since there’s a greater chance it’ll be in the shop when you need it. The combination of these things probably means that you’re making very little money in the long run. Many people will probably not want to bother with it. Two of my coworkers got into Uber when they bought new cars and they were coming in on Mondays bragging about the profits they made over the weekend. As dtilque notes, they ignored my suggestion/warning to let their insurers know they were carrying passengers. Then they stopped around the same time – once they saw how the “profits” they had been using to treat friends and family to dinners and entertainment failed to be enough to cover the actual cost of fuel, tires, washes, vacuuming, air-freshener, signs, et cetera. And then they felt cheated and burned when their insurers sent them letters saying, “We noticed mechanics’ reports that said your odometer readings were out-of-the-ballpark from your reported mileage so we’ll be adjusting your premiums for this year accordingly…” —G! ---
**Author:** ![DCnDC](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dcndc/32/2842_2.png) [@DCnDC](https://boards.straightdope.com/u/DCnDC)\ **Post date:** [May 13, 2019, 4:49pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/70 "2019-05-13T16:49:11Z")
Uber went public Friday. Like their competitor Lyft’s IPO, shockingly [it’s not going well](https://www.reuters.com/article/us-uber-stock/uber-shares-fall-for-second-day-after-ill-fated-ipo-lyft-follows-idUSKCN1SJ1EW). > [@](#): > > Uber Technologies Inc’s shares fell as much as 10% on Monday, more than doubling their losses since the ride-hailing giant’s poorly received Wall Street debut on Friday and raising more questions about investors’ faith in its ability to make profits. > > A screen displays the company logo for Uber Technologies Inc. on the day of it’s IPO at the New York Stock Exchange (NYSE) in New York, U.S., May 10, 2019. REUTERS/Brendan McDermid > The fall in shares come against the backdrop of a global stock market selloff sparked by renewed trade tensions between the United States and China. > > The stock hit a low of $37.17, valuing the company at about $12 billion less than the IPO price of $45. Shares of smaller rival Lyft Inc, which went public at $72 a share on March 29, was down 5.3% at $48.35. ---
**Author:** ![phreesh](https://avatars.discourse-cdn.com/v4/letter/p/9fc29f/32.png) [@phreesh](https://boards.straightdope.com/u/phreesh)\ **Post date:** [May 13, 2019, 7:24pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/71 "2019-05-13T19:24:06Z")
I suggested shorting the (non-existent - oops!) Uber stock months ago to all the haters. Now’s your chance! Even if you’re a bit late to the party. ---
**Author:** ![Snowboarder\_Bo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/snowboarder_bo/32/229_2.png) [@Snowboarder\_Bo](https://boards.straightdope.com/u/Snowboarder_Bo)\ **Post date:** [May 13, 2019, 7:28pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/72 "2019-05-13T19:28:28Z")
> [@DCnDC](#): > > What am I missing that all of these [del]uber[/del] super-rich investors see? > [@RTFirefly](#): > > Damned if I know - I’m just as confused as you are. The ability to launder huge sums of cash back into circulation? ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [June 16, 2019, 9:33pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/73 "2019-06-16T21:33:02Z")
The wife and I finally tried Uber a couple of times and found them actually to be more expensive than a regular taxi. We’ve taken both home from the same location at the same time of day (night, actually), and the taxi is cheaper. And we’ve never ever had a problem with rudeness, dirtiness etc with Honolulu taxis. ---
**Author:** ![Weedy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/weedy/32/301_2.png) [@Weedy](https://boards.straightdope.com/u/Weedy)\ **Post date:** [June 16, 2019, 10:46pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/74 "2019-06-16T22:46:53Z")
In Melbourne last week, the news was talking about ‘Uber Air’. An electric helicopter giving rides from the airport to downtown Melbourne, for the same cost as a taxi. It’s supposed to start trials in 2020. That can’t be profitable. ---
**Author:** ![enipla](https://avatars.discourse-cdn.com/v4/letter/e/54ee81/32.png) [@enipla](https://boards.straightdope.com/u/enipla)\ **Post date:** [June 16, 2019, 10:58pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/75 "2019-06-16T22:58:08Z")
My Wife and I used Uber for the first time recently. Needed a ride from the airport to a hotel, and then a few days later back from the hotel to the airport. Didn’t need a car during the stay (wedding). Both times we used them at very, very early morning (like 2am) in San Antonio TX. Worked absolutely great. 5 minute wait time, and I thought it was cheap (though my experience with taxies is limited). For that trip it worked just great. For daily rides my wife and I will always need our own vehicles due to where we live. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [June 17, 2019, 4:13pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/76 "2019-06-17T16:13:43Z")
> [@Grestarian](#): > > Similarly, I fully expect professional taxi drivers to know\* the areas they drive in, including the shortcuts and the congestion times and alternate routes, et cetera and I still don’t expect a stranger-with-a-GPS to know those subtleties even in the area he stakes out most often. If stranger-with-a-GPS isn’t already better at the majority of routing than a local who knows the terrain, it’s only a matter of time. Even the best local only knows which routes are generally best. GPS apps can update their routes based on real time traffic flows and incidents. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [June 17, 2019, 4:37pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/77 "2019-06-17T16:37:15Z")
The endgame is to make money. No, they haven’t made money yet. What makes you think they won’t? Amazon didn’t make money for something like twenty years. Uber’s only been around half that time. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [June 17, 2019, 5:04pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/78 "2019-06-17T17:04:19Z")
There’s another thread about the new Volkswagen I.D. Buzz (a planned electric update of the 1960s VW Microbus). And in the Wikipedia article about that vehicle, I read the suggestion that VW intends to use an autonomous version of this new microbus in a [rideshare service](https://www.volkswagenag.com/en/brands-and-models/moia.html) it plans as a competitor to Uber. I know that Uber wants to replace the contractor drivers it uses with autonomous vehicles, but I can more easily see an established vehicle manufacturer like VW getting into Uber’s rideshare business than I do Uber getting into the vehicle manufacturing business. To put it in a term from a basic economic course, there are few barriers to entry for others to enter Uber’s business. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [June 17, 2019, 5:56pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/79 "2019-06-17T17:56:28Z")
> [@RickJay](#): > > The endgame is to make money. > > No, they haven’t made money yet. What makes you think they won’t? Amazon didn’t make money for something like twenty years. Uber’s only been around half that time. Here’s a [long article about why comparisons to Amazon](https://americanaffairsjournal.org/2019/05/ubers-path-of-destruction/) aren’t particularly apt, and why Uber is basically a long con. To summarize: Uber never had any major breakthrough that would justify the prices it charges. Its capital costs are higher than competitors (but hidden because individual drivers are bad at determining their costs). Its successes have primarily been in regulatory avoidance (and those chickens are coming home to roost) and underselling competitors by spending huge gobs of money on Amazon wasn’t profitable for many years because it spent money on building out infrastructure. Warehouses, manufacturing, data centers. Uber isn’t profitable and it owns basically _nothing!_ Amazon was unit-profitable relatively early, but plowed everything else into expansion. Uber isn’t unit profitable, and despite growing quite a lot in the last decade, hasn’t changed it’s per-unit losses dramatically. Which means that they haven’t apparently managed to capture any economies of scale. I don’t agree with every point of this article, but I think it is broadly correct. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [June 17, 2019, 6:21pm UTC](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407/80 "2019-06-17T18:21:07Z")
I just read part of that article and I agree with it. As I said, there are low barriers to entry for competitors to enter Uber’s space. And I was surprised by this bit, “Most taxi demand is low-income; higher fares would shrink traffic and reduce utilization. Taxi demand is sociologically bipolar: 55 percent of demand comes from people earning less than $40,000 per year while 35 percent comes from people earning more than $100,000.” [Previous page](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407.md?page=3) [Next page](https://boards.straightdope.com/t/what-is-the-endgame-for-uber/820407.md?page=5)