There were recently a few videos that popped up on my facebook feed earlier where Uber drivers sat down and actually calculated their earnings and expenses over the last month. Ultimately when everything was done and calculated, their profit was far lower than what Uber likes to quote when they advertise. Many of the comments I saw on the video were calling Uber a scam and misleading. While in some ways I agree with them, I also believe people are using Uber the wrong way.
Uber is a company and like most companies will try to maximize its profit because of this, they try to take as much as they can from the drivers, which is currently around 25%. The real problem is Uber does not have many competitors other than lyft and the fee difference isn’t as great as it should be. If Lyft charged 5% from drivers, im sure Uber would lower their fees. In my opinion Uber has such a large user base because they can keep the rides cheap and inexpensive for the consumer, which no doubt affects the bottom line for the driver. Even if Uber didn’t take the 25% that they do, driver earnings wouldn’t be outrageous.
The benefit for Uber drivers is not a high rate of pay, but rather it is the flexibility to drive when you want and the ability to drive part time after your regular 9-5. Many people are driving Uber as a full time job, but in reality it should really be used only as a way to supplement your income. You aren’t limited by how many hours you can work so it really is a great way to get a flexible part time job. Unless your area is in desperate need of drivers and the prices paid are always boosted, most drivers earn at or a little bit more than minimum wage. When it comes down to it, you are probably better off only driving during peak times like during the weekends or around bars at night. Doing this will earn you much more money and you don’t have to spend 12 hours in a car.
If there are Uber drivers that are driving full time and making a ton of money, they usually have hybrid vehicles that massively cut down on fuel costs or they can make extra use of the tax write offs from the depreciation on their car. There are small ways to increase your profit margin slightly, that over a long period of time will help you earn more. Who knows how long this model will even work for drivers anyway, with autonomous vehicles on the way and plans for companies like Tesla to allow you to send your car out as a taxi service while you are at work.
If Uber wants to incentivize more full time drivers they need to either be forced to lower their fees, offer some sort of benefits to their drivers or find some other way to make the income more appealing. Really current Uber drivers should be using the service to help them achieve specific goals, like earning further education and an extra income that will help them in the future. Using it as a full time job and expecting it to exist long term is probably not the greatest idea. There is a possibility that Uber could change and make driving for them much more profitable, but most likely not by a super large amount. We need other car sharing apps like Lyft to pressure them to lower the fees for driving. They recently added tips, which will probably increase earnings, but it shouldn’t be on the consumer to subsidize the living of the driver. We will see what happens in the long term.
-Calaber24p
Hey @calaber24p,
Great writeup. I actually like using Uber, but its a bummer that they are paying out that much. I used Uber all the time when I was in San Francisco and the drivers always seemed very nice. I heard from some news articles that they might be getting their own currency or UberCoin, who knows.
First time I've heard of that Ubercoin possibility. That would be interesting!
Wouldn't it? The possibilities are endless with the virtual coin world.
Most of those people, who are happy with money possible to earn by Uber - have never ever made a precise calculations. And once they finally do - usually they just quit. Here in my country Uber have set the ride prices crazy CRAZY LOW:
€0.59 start fee + €0.33 /km + €0.09 /minute.
Their (uber's) commission is 25%, and driver also must pay VAT from that commission 21%, which makes total 30.25% deducted instantly from every ride payment. Now imagine, if I drive to pick up my rider 4km, and he rides only ~2km, he still payes the minimum, which is €1.50 . From that for driver is left €1.04. To drive 4+2 km, if i deduct all all expenses associated with my 6km drive ( fuel, oil, tires, ensurance, carwash, taxes ete etc ) , what is left is around maybe €0.25. Sometimes even less. And this is for a small car Toyota Auris 1.8L HYBRID. YES, Hybrid. Many with larger cars have much higher expenses.
That all comes to the result - to buy a cup of cheapest cup of coffee in local gas station, I must complete 4-5 such 4+2 km rides ( five?!) Which would usually take 1.5-2 hours.
So, how do you like this - working 2+ hours to buy a cup o coffee in the local gas station ???
That what is UBER here...
Uber is coming to Vancouver later this year! It kind of suck it took them so long , but better late than never. I've always been interested in driving for Uber. Hopefully, I can make some extra money driving for them.
vancounver house is over a million but uber pay penny, i would not drive for them or lyft, find other job if i were you.
haha true
You could drive for Uber "while" looking for a better job. The whole point is freedoms to do what you want and when you want.
Dam, they're not in Vancouver yet...Thats crazy.
Don't take advice from people who've never driven. As a driver there are several things you can look for to see if it's profitable, especially if Lyft is also around. Curious to see if you actually ended up trying it. Can be very profitable if done right.
This is definitly not a job that you could support yourself or family on. Its probly good for college students, retires, and maybe some extra cash to buy something and extra drinks for the chick your trying to get with at the bar that will pop smoke on you at the end of the night and you will never see her again. And she just drank for free.
@spainm87 I was able to support my family (or at least my portion of the income in a two income family). I loved it while I was doing it. I could work whenever I wanted and as much as I wanted. As I stated in another comment, toward the end of my driving "career" it started going down hill and that is why I stopped.
I always thought of it as a part time thing and was seriously concidering it for the near future since I am training for a Pt and once I start working as one will most likely have loads of holes in the daily schedule so that might be a great oppotunity. Thanks for the additional information haven't really got into research myself so that does help! :)
Hey man great post and a real eye👁️ opener. Great post.
Sadly when theres no opportunity we will do whatever to keep food on the table. Its hard because these kind of jobs are clearing up and begin taken over by robots in the near future🤖
follow me @shifty0g
IMHO Uber is a game changer. It's taken over so many countries and the success they are having is beyond measure. Because simply they are improving the lives of their drivers by earning them more money and saving their customers a lot of money as well, so it's a win-win situation here.
I personally prefer Uber on any other service.. for the peace of mind really and it just works!
Actually it is not a win win situation. The taxi drivers are left out of losses.
I like Lyft over Uber for a couple reasons, but yeah I think as far as driving for one of them goes, I definitely think Lyft is better...so I've heard from many drivers that drive for both.
This is interesting. Most taxi drivers used to make a living driving full time. Now that Uber and Lyft are around, would you say that none of them are able to make a living driving full time? Since Uber and Lyft have diluted the pool? It's great on one hand that people can make supplemental income but on the other might put a lot of people out of a full time job.
That's a good description for anyone interested in driving for Uber. I thought about it, to supplement my income. I actually signed up for an account as a driver and downloaded the app to my phone. But, I've never turned on the app to accept riders. When I thought about it, I didn't really feel too safe driving strangers around my county (there's not much of interest in my town except our annual fair, so most people would probably want to go to the airport, about 25 miles away).
Drive for Uber is not a joke. My brother did for 1 year. You have to be ready for anything. I salute you for doing it. Thanks for sharing your story.
Not actually a driver for Uber, just going off what drivers there talk about.
I am planning on driving for Uber this summer as a side-hustle. I love the flexibility that it provides, and many people that I have talked to are making near 20 dollars an hour on average ( I live in LA), so that sounds perfect to me.
yeah if you are in places that have a high demand (which make the app charge more because of the algorithm) you make a decent amount, but in the majority of places it is about minimum wage.
I admire you, driving the hole day is a really hard job, but I can imagine the stories that you must have to keep secret, jajajajaja
I dont actually drive for them, I have a few friends who do though.
Work for Uber sucks in my country ... nice post
Great post, I actually agree with a lot of your conclusions. As much as I would like Uber and similar companies to lower their fees, it's probably unlikely as most of these ride share companies are currently trying to become profitable right now. I do believe that Uber can for the moment offer other benefits to Uber drivers like healthcare insurance, deals when purchasing a new car, life insurance, etc. that can significantly help their drivers.
I've personally not warmed up to this style of transport yet, but we don't have that in the part of the UK I live in. I can trust a taxi because of the info on the back alongside the number plate which links them to the council.
Call me paranoid but I flat out would not trust strangers picking me up in their spare time.
But yes, bring on autonomous driving. I've always said, I'd trust a certified robot more than a human.
Here in Malaysia, younger and older locals seem to be quite happy with it. A lot of the older drivers do it for some extra "coffee money" when they get bored. The younger do it full-time, part-time as a student in college, or just a full-time job.
Uber has also been pretty good for the entrepreneurs in KL. Start up drop shippers, content writers, and free-lance programmers use it to sustain them while they pay for their setup costs.
I'm pretty sure UBER or competitors would be able to charge less if there were less stupid regulations to fights against..
People seem to forget to factor in the wear and tear on the car. Maintenance costs are no joke if you are going to significantly increase the mileage on your car.
My husband considered Uber as side income and networking. Unfortunately where we live, taxi drivers have taken to harassing Uber drivers and even their passengers. Taxi drivers here have a distasteful reputation and not shy to gang up on Uber...considering the lack of safety and compensation, he decided not to go for it after all. Sometimes we pretend the Uber driver is a friend to throw off any taxi trolls!
Taxi drivers make a living driving, why shouldn't Uber drivers be able to do the same?
You are completely correct, after gass you get about $10 - $12 hour, and then you have your car's wear and tear and the miles! Good luck trading it in later!!
Uber drivers in Puerto Rico gets constantly harrased by taxi drivers. It has gotten violent and police have intervened. Uber is against drivers carrying guns, but if can legally carry, do it. Your safety comes first.
Driving Uber is no joke .
Based on what I know of Uber, like the shitty behavior some of the execs exhibit, I can't stand the company. And they're taking WAY too much money for just having coded a stupid app, which runs on Google Maps anyway.
But I will use it if I need a ride, and it has the best price.
What would be awesome is if blockchain tech could take over, and cut companies like Uber and AirBnB out of the equation! I understand there are projects like this in development. Hopefully they'll address the problems, and be better.
how would blockhain tech replace airbnb and uber? 🤔
By executing smart contracts you could theoretically cut out the middleman. I guess the question is what happens when you need support and/or arbitration.
As an example, it'll be interesting to see what happens with markets like OpenBazaar, and if systems like that will eventually replace companies like eBay.
In my country it is much more convenient than taxis
Man every Friday to Sunday uber nightime drivers here in the uk get beyond hassled hope they stay safe to be honest
Doing Uber as a part-time job during the most profitable hours makes a lot of sense - that's clearly the best hourly.
You mentioned a few times that Uber could lower its fees - this seems super unlikely since they are already losing money on most uber rides, the company has almost never turned a profit actually. If anything I suspect they would have to raise rates to turn a profit, but right now they're facing tons of bad publicity as it is. Tough spot
Nice
Did the profitability calculations these Uber drivers did post-hoc include any considerations about insurance risk? Specifically, the lack of commercial insurance that most drivers carry, opening them up to larger accident risks?
I thought about becoming a driver, but to get the best money you have to take the most risk. Late nights and picking up drunks wasn't very appealing to me. Thanks
Making money with uber can be very hard at times!
Competition improves the market for consumers, but I don't know if it would help the employees! It'll be interesting to see how it develops as people make their choices between taxis, Lyft and Uber. Thanks for the insight! I had been wondering if Uber drivers earned anything decent.
Great insight ! I took a few ubers that were driving as a full time job and they did not seem to be very happy about it but, they seemed to be happy about it for the flexibility as you said.
Well, I find Uber an awesome idea for students and guys who cannot earn that amount of money. There are a lot of more profitable jobs out there, but you don't have the same flexibility. It's up to everyone how they want their time/money ratio to be.
uber is a great revolution in means of transport....really admire their hardwork and idea..really looking forward to drive with them
Driving Uber Is not an easy gig.
They need to fix their payout structure, the drivers are the ones who are victims of this "Scam", but if they though the passengers whiff have to pay higher fees.
Ubers been around me for what feels like a long time now and now we have Uber eats. I love the service and its pretty decently priced here in South Africa.
Hi @calaber24p. Really ? They take 25%? It a lot! I don't know if they have same percent also in Romania but I talk with few Uber drivers and they declare themselves happy with the income. Where are you from?
You mentioned "if Uber wants full time drivers they should give incentives " however Uber does not WANT nor need fullfime drivers. As you mentioned, their model employee is people who want to supplement their income or work towards goals and use it to help them achieve that goal.
Also people who work full time for Uber who are complaining that they aren't paid enough should realize a few things and be thankful they even have this option to make a little a money at all.
Before Uber for someone to drive a cab they either had to rent a cab and pay around 100 dollars a day to the person who owned the cab medallion, or they would have had to buy their own medallion and permits to be allowed to work at the airport. The total cost of to own their own cab in most populous cities use to cost about $200k.
Uber blitzed the markets around the US almost overnight. And over night those cab medallions ended up becoming worthless. Uber made billion dollar deals with cities , basically bribing the city council to let them operate in that city.
Did the cab owners get any piece of that money ? Even a dollar of it? Nope they got screwed over bigtime and ended up losing 200k just like that.
Source: my father has been a cab driver for 32 years , with his own medallion and permit and not only is his cab medallion and airport permit basically worthless now but the transpiration business is oversaturaterated in all markets meaning he makes half if not less than what he use to make. Luckily my dad bought his cab business in the 80s where the permits were only a few K and is pretty much at retirement age and doesn't have to support a family any longer
However I do feel bad for the person who likely saved up for years or took out a loan in 2010 to get their own cab medallion, who has a family to support only to have it be a 200k loss because of Uber
Wow! great write up dude, keep it up
Interesting perspective. Found Uber to be incredibly useful in Hong Kong recently.
I've never used an Uber cab.
What's the difference between hailing an Uber cab and a private car driven by a complete stranger?
Is there any accountability if something goes wrong?
Uber is just a cab company in my opinion and judging by how much the company as a whole is worth for doing virtually nothing, I think their taking advantage of their drivers.
Thanks for sharing this. I was thinking about driving for Uber at one point but never finished the application process. I have always looked at it as a full-time kob, but I guess that is not the best way.
@calaber24p It's true about all the complaints that drivers have. I used to be a driver 3-4 years ago in Denver when it first came to the city. I drove for about two years...It was good when I started, but then they started getting more and more regulations and it went down hill. They started cutting fares and then the Colorado State Government put in regulations that required a couple of extra hoops to jump through.
I'm currently doing uber for a living and buying crypto with what i can save. My blogs are about Uber and Lyft.
Recently, Uber has been sending out emails to me hoping to improve many aspects.
Please follow me if you drive for uber too, ill follow you back!
Nice post!! I followed you
Can any Uber drivers from the UK (outside of London) who read this please inform me of their earnings?
Asking for a friend who is interested in driving for them in Merseyside but needs to know on average how much he can make..