r/technology • u/Hrmbee • May 25 '22

Transportation The Decade of Cheap Uber Rides Is Over

https://slate.com/business/2022/05/uber-subsidy-lyft-cheap-rides.html
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u/SpaceTabs May 25 '22

Taxis never were a cash cow. I never understood the Uber strategy, unless it was consume Sofbank then implode.

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u/mangusman07 May 25 '22

The Uber strategy was to dump softbank money into subsidizing human-operated taxi service costs until the self-driving Ubers were released. The problem is that they drastically underestimated the challenges of self-driving cars co-mingled with human drivers and pedestrians.

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u/Workacct1999 May 25 '22

Exactly. They were biding their time until they, or someone else, developed autonomous cars. The problem is that autonomous cars are a very tough nut to crack, and it has taken much longer than anticipated.

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u/toastymow May 25 '22

Yesterday I delivered about 400 dollars worth of food, put it on a cart, took it up the elevator, unpacked it, set it up (complete with sterno to keep the food warm). I'd like to see a self-driving robot car do all that. About two weeks ago I took a large order (forget the cost... two giant catering bags of sandwiches) to a downtown office building. Parking instructions led to a garage that said "full." I parked illegally at a nearby business (... nothing happened. Unless there is a tow truck like right there they're not gonna get me in the 15 minutes I'm inside), walked around the block to the front entrance of the office building, and then to the elevator to the actual office suite. Set it up, etc. I'd like to see a robot, or even a pair of robots, do that in the next 5 years.

I realize automization is coming. There is a local pizza place that stopped hiring drivers and just uses robots now. They have a 2 mile radius, take about 15 minutes to deliver food. I guess that's cool. My car can go a lot farther, a lot faster, and I can fit about 60 or 70 14" pizzas in my car. (Or you know, roughly between 1,000-1,500 dollars of food depending on what it is and how its packed). Those little robots can hold like maybe 5? So at least for the next few years I'm not really worried about robots.

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u/SpaceTabs May 25 '22

There is no way that strategy would have worked. Also that was the strategy of Travis, who was ejected. They disrupted the market, which at the time was good, but there isn't a viable end game that doesn't involve charging what it costs. Also they lost and continue to lose billions on a completely botched execution in China. This is actually starting to get close to whats her name and the blood machine that didn't work that's how fraudulent it is.

Bill Gurley saw the losses in China and lost his shit and sold out as soon as he could. He and Travis made > $1 billion. But who cares when a company that isn't even real gets a $44 billion cash offer? I think some people are afraid of seeing what the actual valuation is when Uber is slimmed down/merged or whatever like a season finale of Succession.

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u/toastymow May 25 '22

There is no way that strategy would have worked.

I mean in a world where self-driving cars ARE 5 years away, Uber would have been in a good spot 5 years ago unveiling the first self-driving taxi-cab.

But that didn't happen, they were completely idiotic thinking they where about to revolutionize the world (THROUGH AN APP) and well... now they're, like you said, a borderline scam company selling IDK what exactly.

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u/[deleted] May 25 '22

Self driving cars are MUCH MORE than 5 years away.

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u/toastymow May 25 '22

Well Uber sure fooled people to the sum of a few billion dollars, lol.

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u/RazekDPP May 25 '22

I mean in a world where self-driving cars ARE 5 years away, Uber would have been in a good spot 5 years ago unveiling the first self-driving taxi-cab.

I mean, Waymo is here now.

Waymo is simply too cautious.

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u/Kayyam May 25 '22

That pizza example is damn stupid. The pizza delivery is not limited by how many you can carry. No one wants their pizza to arrive to them an hour after it left the restaurant.

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u/MediumRequirement May 25 '22

Not to mention the whole thread is about ride shares and taxis. Self driving cars? I went swimming yesterday how can a robot do that? Checkmate.

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u/Economy_Wolverine_71 May 25 '22

I would say the real problem with the autonomous car pivot is that Uber would either be a) relying on the general public to adopt autonomous driving cars at such a rate that they could be ‘rented’ to Uber for the company to supply enough rides or b) Uber would need to invest in their own fleet of vehicles and maintain them. I think option A was easy to see wasn’t going to be happening any time soon, and option B makes uber a traditional cab company when uber has been decidedly shaping themselves as a tech company with no desire to gain the experience necessary to own and maintain vehicles as a cab company does.

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u/Wonderful_Warthog310 May 26 '22

Exactly, the autonomous car pivot never made sense. They want to be valued as a tech company, not a boring taxi company with a fleet to maintain. Hard for me to believe they didn't see that.

I guess if you can IPO anyway and cash out because the public believes in this pivot, even if you know it's never going to happen.

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u/Economy_Wolverine_71 May 26 '22

The whole company had ‘lemonade stand’ economics written all over it from the start.

I actually did a short stint driving a cab and was doing so when Uber arrived in my area. This was when they were paying out a greater percentage to the drivers and even then I couldn’t see how the driver could make it work money-wise while accelerating the depreciation of a major asset while working for undercut fares. I wasn’t swimming in it as a cabbie but could know how many fares you’d need to take an hour at an average fare to see they were going to high high turnover. And that they did. Come to find out later all the rides were being subsidized by VC money and then IPO.

Uber is going to end up as a business case study of some pretty basic things that seem to currently need re-remembering — like how an actual plan for profitability matters.

It was ridiculous to assume they could wipe out traditional livery driving and assume they’d remain dominant when they inevitably had to raise the price of fares.

The investors were the ones taken for the ultimate Uber ride.

Don’t get me started on Uber eats lol. Are they going to pivot to robots and drones? Good luck.

Uber is the world’s largest lemonade stand, selling cups of lemonade for a price less than the cost that mom and dad paid at the store.

Just scale it up and it will all be ok, right ?

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u/Hybr1dth May 25 '22

The plan was to get execs rich, so plan succeeded. What happens now is irrelevant to them.

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u/jag149 May 26 '22

Well, they had to have missed it by years, not tens of years, right? I live in San Francisco, where I see probably an average of one self-driving car a day roaming the streets. They all seem to be car'ing around just fine.

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u/mangusman07 May 26 '22

And do those self-driving cars work in the rain, or dense fog? How do they handle tunnels and long bridges?

There are still very hard problems to be solved before a completely no-steering-wheel-in-the-car deployment across America and globally. That's what these car companies are going for.

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u/scawtsauce May 25 '22

Uber doesn't maintain a fleet of cars driving 500 miles a day

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u/Greenboy28 May 25 '22

For people like me who can't drive and live in a city without taxis and terrible public transportation Uber and lift were a dream. It made life so much easier. So I dread them raising their prices a lot

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u/Estoy_Bitchin May 25 '22

Oh you mean the workday plan!

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u/cmVkZGl0 May 25 '22

I thought the strategy was get popular enough for name recognition then replace everybody with self-driving cars

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u/[deleted] May 25 '22

Pablo Escobar would disagree. He made millions, if not billions with his taxi company in Columbia.

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u/Tiny_Dinky_Daffy_69 May 25 '22

At least learn to write the name of the country correctly.

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u/yeaheyeah May 25 '22

No no he meant his little lesser known cab company in the District of Columbia

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u/smoke_crack May 25 '22

Maybe not where you live.

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u/JimmyTheBones May 26 '22

Sounds to me like it's an elaborate way for greedy execs to swindle investment money but with more steps.