Reply to post: Re: I'm not sure I see how they get to profitability

What's that? Uber isn't actually worth $82bn? Reverse-gear IPO shows the gig (economy) is up


Re: I'm not sure I see how they get to profitability

If you take an existing Uber - financed on a subprime, no-look auto loan; combine it with a minimum wage (or less) driver - then subsidize 40% on top of that, how will the addition of $30K to $100K in gear equate to a profitable company?

A recent SF study showed both that ride share is increasing, not decreasing congestion but more importantly is contributing to 15% of the vehicles on the road. My personal estimate of ride share cars on the road in SF is 40K; there are 220K vehicles coming into SF every day for which 15% is 33K vehicles on the road.

If these are replaced by robocars, it means the ride share company have to buy or lease 30K to 40K vehicles just for SF. 30K to 40K self driving vehicles requires $60K to $130K (or more) capital purchase cost apiece = $1.8B to $4B+ capital spend for just 1 city of under 900K people. The cars still have to be serviced, washed, vomit removed, refueled etc which adds more cost.

Internet docs show NY Taxis average 3.3 years in age and 70K miles per year - it seems unlikely robocars will have longer service lifetimes.

Can ride share be profitable? yes - particularly at the luxury levels.

Can ride share be profitable at the present scale, with or without robocars? Extremely unclear.

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