Why doesn't Uber just raise prices?

[SaltyNuts]

I keep hearing about they are losing money, losing more money, losing even more money, more losses expected, etc. etc. Has no one told them if they are losing money on rides maybe they should CHARGE MORE for said rides? LOL, how many big-wig executives are they paying hundreds of thousands, or millions, of dollars a year that can't seem to figure out this simple principal?!?!?

 

[ElFenix]

uber won't raise rates until investors demand it. right now investors aren't demanding it.

 

[OccamsToothbrush]

Have you ever operated a business more complicated than a lemonade stand? At this point Uber can't afford to raise prices. Lyft is cutting into their market share in a big way. The second Uber raises prices its customers move to Lyft and Uber loses even more. It's possible that this market segment will never be profitable, but it's guaranteed that it can't be profitable until there's a single dominant entity. The two biggies have to fight it out until one is left standing, then and only then can that one worry about profits. Whoever goes broke first loses.

 

[SaltyNuts]

uber won't raise rates until investors demand it. right now investors aren't demanding it.

Really? Why would uber WANT to lose money? Like, "We are going to lose more of our shareholder's money until the shareholder's make us stop losing their money!!!". I thought their basic mandate was to try and make their shareholders money.

 

[s0me0nesmind1]

I keep hearing about they are losing money, losing more money, losing even more money, more losses expected, etc. etc. Has no one told them if they are losing money on rides maybe they should CHARGE MORE for said rides? LOL, how many big-wig executives are they paying hundreds of thousands, or millions, of dollars a year that can't seem to figure out this simple principal?!?!?

Uber will raise prices when the market is developed. As long as stiff competition remains (Lyft, for example) I don't see them raising. It wasn't that long ago when Amazon was taking large losses as they ramped up their spending, R&D, and priced others out of the market. Now they raised Amazon prime prices multiple times, and raise the prices of goods as well. Netflix was similar and they have had a few price increases as of recent.

To be honest, a lot of times Uber's pricing for me really isn't THAT significantly better than a standard yellow cab... So I don't think they have much room to lower.

 

[highland145]

Loved uber when we went to Boston. Never waited more than 5 min. My home town, not one in sight....

 

[zinfamous]

Loved uber when we went to Boston. Never waited more than 5 min. My home town, not one in sight....

It's the bathing requirement that puts off potential local drivers for your area.

 

[highland145]

It's the bathing requirement that puts off potential local drivers for your area.

Says the mouse fondler.

 

[Scarpozzi]

I recently needed a ride and chose between Uber and Lyft....Lyft driver was there in 5 minutes and it was a few bucks cheaper than Uber.

I've still never Uber'd anywhere.

 

[ponyo]

I recently needed a ride and chose between Uber and Lyft....Lyft driver was there in 5 minutes and it was a few bucks cheaper than Uber.

I've still never Uber'd anywhere.

Lyft is usually little cheaper than Uber but if you travel outside the US, Lyft is worthless since they only operate in the US. Uber is not everywhere but still in lot of countries. When I was in Cartagena and Bogota, I used Uber most of the time unless I had the hotel or restaurant staff call me taxi. It's not advised you get into random taxi on the street in Colombia if you're foreigner.

Some countries have alternatives to Uber where it's banned or Uber couldn't compete with the local rideshare company. For example, Didi dominates China and Uber gave up there and took small stake in Didi. Kakao Taxi dominates Korea and Uber is not worth using. Taxify is used in Hungary since Uber is banned there.

Uber is stopgap solution. Once autonomous driving arrives in the next 10-20 years, Uber won't be able to compete since they don't manufacture cars.

 

[ElFenix]

Really? Why would uber WANT to lose money? Like, "We are going to lose more of our shareholder's money until the shareholder's make us stop losing their money!!!". I thought their basic mandate was to try and make their shareholders money.

Amazon's retailing operation is well in the red and may never be profitable if an interest rate is applied to those losses. And it's in the top 5 of most successful companies on Earth right now.

I recently needed a ride and chose between Uber and Lyft....Lyft driver was there in 5 minutes and it was a few bucks cheaper than Uber.

I've still never Uber'd anywhere.

Nearly all consumers and drivers have both so it's trivial for the customer to compare pricing.

 

[s0me0nesmind1]

Lyft is usually little cheaper than Uber but if you travel outside the US, Lyft is worthless since they only operate in the US. Uber is not everywhere but still in lot of countries. When I was in Cartagena and Bogota, I used Uber most of the time unless I had the hotel or restaurant staff call me taxi. It's not advised you get into random taxi on the street in Colombia if you're foreigner.

Some countries have alternatives to Uber where it's banned or Uber couldn't compete with the local rideshare company. For example, Didi dominates China and Uber gave up there and took small stake in Didi. Kakao Taxi dominates Korea and Uber is not worth using. Taxify is used in Hungary since Uber is banned there.

Uber is stopgap solution. Once autonomous driving arrives in the next 10-20 years, Uber won't be able to compete since they don't manufacture cars.

IIRC they are developing automation software and are fully prepped to go to market with it in the future.

 

[Scarpozzi]

IIRC they are developing automation software and are fully prepped to go to market with it in the future.

Yeah, but they're making those automation systems in China. I'm concerned that asian driving automation will drive as poorly as the people who wrote the automation.

 

[ponyo]

IIRC they are developing automation software and are fully prepped to go to market with it in the future.

They're using Lidar and HD maps like Waymo which is the wrong approach to autonomous driving. So they won't be able to scale. I don't want to turn this into Uber vs Tesla but Tesla Network will kill Uber once it's perfected and scaled.

 

[ponyo]

Yeah, but they're making those automation systems in China. I'm concerned that asian driving automation will drive as poorly as the people who wrote the automation.

They're not making these automation systems in China. Start watching some Lex Fridman videos on Youtube. He has video podcast where he talks AI and autonomous driving with different guests all the time. There's pretty recent one he interviews George Hotz (geohot) that's pretty interesting. Autonomous driving is all about data and machine learning. He who has the most usable data will win the race to autonomous driving.

Here's small short clip of geohot talking about who he thinks is going to win the autonomous driving race. His full interview is pretty fascinating and worth watching IMO.

 

[pmv]

I don't quite understand why there isn't some sort of driver-owned co-op version of Uber. Where the guys who drive, own, and pay for, the vehicles share the profits. I guess there's a lot of advertising, branding, political-schmoozing and organising involved. Still seems like it would be more amenable to co-op approach than businesses where physical plant and buildings etc are key and where the bosses own all of it.

 

[shortylickens]

 

[Red Squirrel]

I don't even get how they are so big. A ride sharing app can't be THAT complicated to manage is it? If I didn't know any better I would guess it would be a couple guys that take care of it and the servers are in a colo facility.

I guess there's lot of legal crap to deal with too so almost need a full time lawyer, then there's lot of tax stuff so need an accountant... I guess it does add up.

 

[Sgt. York]

Uber has about 12,000 non driving employees.That's a few more than two guys taking care of an app and one lawyer.

 

[Scarpozzi]

They're not making these automation systems in China. Start watching some Lex Fridman videos on Youtube. He has video podcast where he talks AI and autonomous driving with different guests all the time. There's pretty recent one he interviews George Hotz (geohot) that's pretty interesting. Autonomous driving is all about data and machine learning. He who has the most usable data will win the race to autonomous driving.

Here's small short clip of geohot talking about who he thinks is going to win the autonomous driving race. His full interview is pretty fascinating and worth watching IMO.

Sorry you typed so much to respond to my lie/joke.

 

[Stopsignhank]

Got a ride to the airport last week. Checked for Uber drivers in the area because it was early in the morning. It was $60 on Uber, then 5 minutes later with surge pricing it went up to $95, then over $100. Lyft was $60. The Lyft driver was a very nice guy and got a $10 tip.

 

[ponyo]

Sorry you typed so much to respond to my lie/joke.

I replied to your bad joke not for you but hoping someone else might be curious about developments that's going on with autonomous driving. EV and autonomous driving are going to reshape our future. I figured this being sort of tech site, people might be interested.

 

[Red Squirrel]

Uber has about 12,000 non driving employees.That's a few more than two guys taking care of an app and one lawyer.

Yeah that's the part I don't get, why do they need that much staff? I feel they are probably operating super inefficiently which is why they are losing so much money. A mobile app service should not require that much staff behind it unless there is something I'm missing about the complexity of how the app works.

 

[Scarpozzi]

I replied to your bad joke not for you but hoping someone else might be curious about developments that's going on with autonomous driving. EV and autonomous driving are going to reshape our future. I figured this being sort of tech site, people might be interested.

Wait....it was a bad joke?

 

[olds]

Haven't used Lyft yet even though I have the app on my phone. Only because I am old and I know how to use Uber. I'd guess Lyft is the same. Uber to our favorite Restaurant/bar is like 8 bucks with tip. Can't beat that vs a DUI.
One thing I will say is most Uber drivers can't drive for shit. I hate coming up behind them in traffic.