Uber

Last night I saw that Uber posted an $800 million third-quarter loss.

I know they're in a price war and, to be honest, sometimes I'm surprised how little they charge. Are we willing to pay more? And how do you think that this will all play out?

I take uber every day. I take use uber pool, get picked up outside of a train station and get let off outside of work. It saves me about 5-10 minutes and is a lot more comfortable.

I pay between 25 cents and $1 more to take the uber than the train. When it gets up to about $1.25 more, I go back to the train.

So no, I'm not really willing to pay much more. I don't know if I'm the bread and butter though. I also looked at it to take me to the airport. It was more expensive than a limo. I took the limo.

I don't think we're willing to pay much more. Their big draws are the availability of rides and the cost. I don't know how far the availability will take them if the price advantage is gone.

I use it to avoid driving unsober, and the cleanliness of the cars and ability to pay including tip without needing cash or dealing with cards is a big plus.

They could increase their prices 50% and I'd still use them over Boston taxis.

Drivers last less than 3 months... They incent the heck out of drivers to keep them, so once they go driverless they believe all those payments will go away.. But then they'll have car upkeep, which I believe they are underestimating..

Do I think they are going away? no.

do I think they can continue in the same spend like hell mode? No..

I've found where, I live.. That Uber is more expensive that competing modes of transportation. To the Airport, A flat rate cab is cheaper and only slightly less convenient. Around a City on business travel, I utilize cabs because I'm usually at a hotel that has them waiting outside.

Going out on the town drinking? I use Uber, just more flexible.. but I don't use do that often.

Uber was in the news in California last week for deifying common sense, the rule of law, good taste, apple pie and everything normal by claiming that their self driving (oops- remember what the lawyers said about liability) driver assisting cars operate in a different regulatory universe that those off all the other companies testing self driving cars in California:

"Anthony Levandowski, vice president of Uber’s advanced technologies group, said in a conference call with reporters. “You don’t need to wear a belt and suspenders and whatever else if you’re wearing a dress.”

I've talked to drivers who work for both Uber and Lyft and they like Lyft allot more and Lyft generally pays them more and treats them better. So I'm happy to pay a couple bucks more to use Lyft and I do not use Uber. I personally think that the monitization of excess capacity (the SHARE economy!!!) is a good thing. But it is not as simple as 'sharing', as by the time society catches up with the real issues of liability, insurance, customer safety, and responsibility when something invariably goes wrong and assigns accountability to the company making the money, the margins promised to investors begin to look less 'disruptive' and more like investing in a cab company.

I think self driving cars are inevitable and Lyft and Uber are transitory- the auto makers will take the loins share. Personal fortunes have been made by the Uber and Lyft founders but no profitable company will persist. In the case of Uber the 'brand' will be toxic and not even Volvo will bother to buy the placard.

$3 billion in losses this year

Apparently, they've spent $1.55 for every $1 they've made, and there's a legal battle over autonomous stuff brewing with the state of California. Yet somehow, this company is worth $62 billion on annual revenues of $2 billion, while Ford is worth $55 billion on $136 billion in revenue.

I think their best shot long term is to be purchased by an automaker, but they're currently valued higher than both Ford and GM, and it's hard for Company A to buy Company B when Company B is worth more.

When I'm travelling I use Uber black over a taxi if I don't get a rental car. I would still pay more for the black service because I like the cars and taxis have generally been pretty filthy in comparison. Being the car whore that I am I also like the fact that you know what kind of car is on the way and can cancel if you don't like it.

In Pittsburgh cab service is terrible if you are not going to or from the airport. They don't want the other work. Uber fills that void perfectly. I haven't used it much here but used it every day on a business trip to Nashville and it was awesome. One driver told me he gets daily commuters since it costs them half the price to park. I'd pay more.

State governments here are in the process of trying to impose taxi/hire at legislation to uber given that that's essentially what they've become. Uber isn't a ride share service like it was initially launched as, it's an unlicensed taxi service.

Much the same way as air b'n'b is becoming a way to try and skirt rental laws.

The so called sharing economy doesn't work once big money starts becoming involved. It becomes exactly what it's trying not to be, Wich is big business.

I've taken exactly zero "ubers" in my life. I may change that at some point but it's unlikely. At 45 I've probably taken a train less than a dozen times and a taxi less than half a dozen. Public transportation isn't my thing.

It's a matter of time before all of the "ubers" are Armenians in 250k mile Prius. Disruptive tactics are transient by nature. Rude drivers in filthy cars with horrible taste in music have had this market cornered for a long time. These are the good old days. :)

I've used Uber several times as well as Lyft. There was also one ride with something called RideAustin. Before all that, I also used a cab on a few occasions. So far, the cars have been cleaner and in nicer shape with the "rideshare" services, which is nice. Pricing has been better as well. The real advantage has been the ability to take out my phone, hit a button, and have a car and driver find me where I am and take me where I want to go. I've not tried any taxicab apps like that, but I would imagine that as the traditional taxi companies roll those out, the advantage starts erode.

What I find really disingenuous about the whole thing is the idea of "ridesharing". As though your Uber or Lyft driver was going to be going from the airport to that hotel anyway and you're just paying part of the cost to get there. It's a gypsy cab service, pure and simple. There's no "sharing" involved, you're just paying a stranger to pick you up and take you somewhere but since we don't call it a cab, the stranger doesn't have to pay any of the licensing or regulatory fees that a taxi company has to pay. Because Internet.

Don't get me wrong, I like the service they offer, but calling it anything other than a gypsy cab doesn't change what it is.

Two thoughts:

-They spend a lot on investing in the future and expansion. Like Tesla and many other tech entities, they could be a lot more profitable if they did business the old way, but ironically wouldn't be worth nearly as much.

-I'm starting to see more and more insane valuations and its looking more and more like the late 90s. You can only burn through other people's money for so long before they start jumping ship. Throw in the possibility of trade war on the horizon, and I'm really wondering if I need to start cashing out....

Gypsy cab service. Yup, I like that description.

Sooner or later they're gonna be legislated out of business. Way too many issues with the business model. Can't believe in their valuation. Crazy.

I use them when my sobriety is less than ideal for operating transportation equipment AND I'm not using an expense account so... hell, if I was willing to pay top dollar for poison I'm probably willing to pay whatever it takes to get to a bed that isn't in a jail.

But, once they are in pissing distance of a regular cab cost... what's the difference? I'll call whomever can get there first.

The problem I have with the "gypsy cab service" description is that at least here in Chicago, the barriers to entry make it impossible for new competition. A good deal on a medallion is $85k. That doesn't even get you a vehicle.

I wouldn't have a problem with that if the last 4 cabs I have been in were either safe or clean (both is too much to ask). Time for a "rebellion". They've had no competition. Now they should clean up their act.

mtn wrote: The problem I have with the "gypsy cab service" description is that at least here in Chicago, the barriers to entry make it impossible for new competition. A good deal on a medallion is $85k. That doesn't even get you a vehicle. I wouldn't have a problem with that if the last 4 cabs I have been in were either safe or clean (both is too much to ask). Time for a "rebellion". They've had no competition. Now they should clean up their act.

Just because the existing cab companies have a monopoly and have increased the barriers to entry to unreasonable levels doesn't mean that Uber/Lyft aren't gypsy cabs. I don't mean that description as a pejorative, but as a more accurate description of what they do.

My opinion is that anyone should be able to operate a "for hire" car service so long as they have a driver's license, a tagged car, and a good amount of insurance. And I'm hopeful that the disruption that Uber/Lyft have caused will be a catalyst for regulatory change.

But it's still a taxi that doesn't follow the rules that the other taxis have to follow.

I had no idea that Uber's valuation was so unhinged. Wow. Short them. I lived in San Francisco during web 1.0. and It was so obvious to anyone with a brain that Pets.com and Webvan.com and their ilk (including the idiotic .com I worked for) were completely ridiculous and basically scams. Silicon valley startup culture is built around making money for the founders and initial investors who make money on the initial public offering and pretend to care after that. Sure- some stuff blows up and justifies the myth- but it was and is a deeply stupid, incredibly arrogant, and wildly out of touch place. IMHO In 10 years Ford will be here in a big way and Uber will have faded from relevancy if it still exists.

I usually use Uber when going to/from the airport. Parking at EWR6 is $17/day, tolls are a few bucks, so the $28 Uber ride (each way) is worth the cost as long as I'm taking a 3 day+ trip.

When I came back from the airport this past Sunday, though, there was surge pricing, so the ride was $60 instead. Kind of a bummer. Just shy of what the cab hawkers were asking. If it was $60 each way, I would take the train instead, which takes twice as long, but costs $12 each way + a 20 minute walk.

There are other app services like arro that allow you to call and pay for regular cabs without a cc. Making the regular cab service almost exactly the same as uber.

I dunno how anyone makes money in this biz though, I regularly (2x per week) spend 45 minutes in a cab in NYC, cover 5-10 in tolls, and leave paying $45 total. At less than a dollar per minute revenue, no one is getting paid much.

I agree with mtn though, in some places there are stupid protectionist regulations in place that were preventing free market from acting completely. Uber has done a good job of making those regulators (and the cab companies that paid them) rethink.

I will also add that ubers "flexible pricing" is often seen as a burden to consumers (ie this is crap cuz I have to pay more for my ride), but I argue the opposite.

Last week I stood outside for an hour trying to catch a cab near Rockefeller center before I got one. Almost missed my plane. I would've gladly spent a higher price to get priority with the cab drivers.

Kreb wrote: ...they could be a lot more profitable if they did business the old way...

That's not very hard to do...A rock would typically be more profitable.

klb67 wrote: In Pittsburgh cab service is terrible if you are not going to or from the airport. They don't want the other work. Uber fills that void perfectly.

This. You can't get a cab in Pittsburgh. You can call, you can use their App, you can call again and again...you won't ever see a cab. And if by some miracle the cab you called and waited an hour for does arrive, they will gladly pick up the cute girl who flags them down one block before they get to you. And they are rude and drive like idiots. Uber is a savior to towns like Pittsburgh. I use them to commute from the suburbs into town for nights out all the time.

When I travel, I used Uber almost exclusively. The company is paying, so price is not my primary motivator. In fact, receipts are sent directly to my expense App and I never see them. They are more convenient from most airports, more reliable around town, cleaner and the drivers are not complete a-holes. By that I mean, when I ask you if you take credit cards and you say yes, then I show you my Amex card and get a re-confirmation that you take credit cards, then when we arrive you get pissed that I am using a credit card and you ask for cash then claim your machine doesn't work. With Uber, I get there and get out, no fuss no muss.

And If I have a bunch of guys going out to dinner, I don't have to deal with fights breaking out in the Hilton Portico because we went to the minivan that was third in line instead of having to get two Prius cabs. I can grab a Suburban in 3 minutes and skip the hour wait in the cab line.

I would gladly pay more for Uber, I consider it essential to the business traveler.

From a value for service perspective, uber is amazing. In Baltimore, public transit is limited and taxis are too expensive for regular use (plus, half the time, the cabbies don't know where they're going or take the long way to jack up the meter), so uber actually is perfect. It'd be nice if they paid they're drivers more but, with my limited means, I really appreciate the affordability.