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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region Forums'I made $3.75 an hour': Lyft and Uber drivers push to unionize for better pay
https://www.theguardian.com/us-news/2019/mar/22/uber-lyft-ipo-drivers-unionize-low-pay-expensesI made $3.75 an hour: Lyft and Uber drivers push to unionize for better pay
Michael Sainato
Fri 22 Mar 2019 06.00 GMT
For over a year Rob Mead has worked as an Uber driver in Reno, Nevada, to supplement his income as a public sector worker. Now hes wondering if it is worth it. After gas, added monthly rideshare insurance, wear-and-tear, constant oil changes and taxes that $300 for 30 hours of work I thought I made in a week actually averages down to about $90 after expenses, said Mead.
A few weeks ago I drove four passengers in a one-hour period. I looked at my profits and I made only $12 It was snowing, traffic was crazy and I basically risked my life to make that $12. After expenses I made $3.75 that entire hour.
Meads wages contrast sharply with the fortunes that the executives at the rideshare companies Uber and Lyft are about to reap. This week Lyft started its investor roadshow as it prepares for its stock market listing. Lyfts cofounders, Logan Green and John Zimmer, stand to make hundreds of millions from the sale, currently valued at $23bn. Uber plans to follow Lyfts initial public offering (IPO) in April a share sale estimated to be worth $125bn that will create a new generation of millionaires and billionaires from its executive class.
(snip)
Uber and Lyft are planning to give some long-term drivers money to buy stock, granting them access to the hotly anticipated IPOs. But only a minority will be eligible and in the meantime drivers are organizing for better wages rather than bonuses.
Im not interested in what stingy package theyre going to offer, said James Hicks, an Uber driver in Los Angeles for about four years. He has not heard anything from Uber regarding stock grants for drivers, but said he had recently had his pay slashed by the company. You cant tell me a billion-dollar company cant afford to pay their drivers when all they really need to worry about is marketing and upkeep of the app.
(snip)
Omaha Steve
(99,775 posts)democratisphere
(17,235 posts)while beating up their equipment. Few ride share patrons provide the drivers with tips to supplement their income. I don't see the driver's position getting any better and ride sharing is not a viable business for the hard working drivers. It is always about transferring wealth to the wealthiest.
we can do it
(12,205 posts)cstanleytech
(26,334 posts)customerserviceguy
(25,183 posts)knew the answer to that question.
I will never use illegal taxi or illegal hotel services. And I sure as hell won't provide them.
we can do it
(12,205 posts)James48
(4,443 posts)I would not dream of using Lyft without giving a significant tip to the driver.
I always tip like AT LEAST 20 to 30%, or a minimum of $5 on a short ride of $10 or less.
$40 trip to the airport? I wouldnt consider less than a $15-$20 tip.
Am I that unusual?
Honeycombe8
(37,648 posts)Just to know, since that's a big factor.
I've always maintained that using your own car for a job is generally not a good idea, if only because it puts you on the streets so much more so that the odds of getting in an accident skyrocket, which would increase your insurance, plus expose you to injury. The wear and tear and increased mileage on your car also devalues it, which costs you.
Same thing as pizza delivery.
c-rational
(2,596 posts)Regulation, fair taxation, and a rewrite of this false notion that an individual and a corporation are equivalent - hogwash.
LittleGirl
(8,292 posts)Thats it exactly.
ProfessorGAC
(65,241 posts)There is an investor mania at play here.
Uber had $2.8 billion in revenue & lost $890 million, but most recent pre-IPO value is $120 billion.
Lyft is much smaller, but revenues are more than half but appear to be reasonably profitable.
But, there is no economic underpinnings to these high values so on public sale, the execs and founders are going to be obscenely wealthy without the actual fundamentals to support it.
So, I looked up 3 articles on each, regarding the risk to the investor.
They all tell investors to be very cautious. One article made a VERY sharp point that neither company has ANY intellectual property. Weak sauce for sustainability, IMO.
That kind of tells me the investors are going a bit crazy related to these 2 companies, which are essentially a taxi variant.
fescuerescue
(4,448 posts)But bear in mind that it's venture capital firms that are doing the investing. Also Uber and Lyft are heavily leveraged by the VCs. While the execs at these companies will do well, it's the VC firms that will reap 98% of the windfall.
The value in these companies has never been the I.P. Literally the IP can be replicated by a small team of coders in a few weeks. The value in these companies is that they essentially OWN the new worldwide Taxi market. Taxi companies have always been regional, carry heavy expenses and barely profitable.
The value in Lyft and Uber is that they created and own a worldwide taxi industry. Previously there were tens of thousands of local taxi companies. Now it's a worldwide industry owned by two players.
Those VC investors? they might be crazy, but they are crazy investors who'll earn 120 billion'ish.
ProfessorGAC
(65,241 posts)Small people doing "get rich quick" are going to get killed
fescuerescue
(4,448 posts)A big clue that it's not a good IPO is when anyone can participate.
in an IPO, it's the original investors selling the company (or a portion) to the public. The original investors in these two companies will make BANK BANK BANK as they sell to everyone trying to get into this IPO.
MineralMan
(146,338 posts)passengers, compared to what the driver is paid. Margins are everything in business.
If he made only $12 in an hour driving four passengers, the question is how much did those passengers pay for the ride. All business requires you to subtract all expenses before calculating your profits. That's how it works.
Since I have no idea what Lyft fares are, I have no idea what his passengers paid and thus have no idea what the margin is between that and his actual receipts for the work.
Lyft got whatever money he didn't get from what they paid, minus card processing fees. Lyft has other overhead as well. However, I suspect that Lyft does better for that hour with four fares than the driver does.
Lyft does not pay its drivers at all. Its drivers are private contractors. Lyft pays a royalty on fares it collects from passengers. The driver has to subtract cost of doing business from that royalty. Such arrangements almost always benefit the company far more than its individual private contractors who provide the actual service. What that driver reports doesn't surprise me at all.
madville
(7,412 posts)A four mile ride to the airport here is $16 and I tip it up to $20.
Two miles home from the bar, usually around $8.
I don't see how they make any money, sounds like they don't these days.
trev
(1,480 posts)I made next to nothing, and never received a tip--not even when I had multiple passengers on a ride.
I hated the job, and didn't keep it very long once I saw how little I was getting from it.
Opel_Justwax
(230 posts)Soon automated cars will be taking over the place of all these drivers. Then they will be left with nothing. Of course 40% of the employed population over the next few years will be replaced by robotics and automation. We can all live in a shanty towns while the 1% party in their hilltop mansions.
MichMan
(11,998 posts)They will be in demand everywhere and most likely do very well for themselves.
mainer
(12,031 posts)I always tip 30% and even then it's inexpensive. They need to raise the rates for rides so drivers get paid more.
I take Lyft because it's the most convenient, and you can never find a taxi when you need one.