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Mr. Money Mustache, UBER Driver

Unrelated Surprise: Did you know there is now an MMM Android App? It’s really good. Beautiful offline reading. Alerts you to new articles automatically, if you want. Thousands of users already. Free. Many more features (plus an Apple version) to come. It’s on the Google Play Store.

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About two years ago, I switched from taking my personal car to the airport, to hailing Ubers and Lyfts. The math of it was pretty simple: Uber was cheaper than paying for my driving and parking*. And that was before the considerable joy and time savings of not having to park in the airport lot and cram in among the huddled masses in the shuttle buses. Nowadays I sit in the back and get some work done like an Executive, leaving the driving to someone else.

Once I arrive at my destination city, these ride sharing services have replaced at least 90% of instances where a car rental would be useful. Between walking, renting a bike, public transit and calling a Lyft, a car rental is only useful for destinations deep in the boondocks such as a ski resort or a distant beach cabin. Which is another great improvement, since renting a car at an airport has never been a fun experience.

But during all these Luxury Executive rides, I’d often get to talking with the driver. We would talk about life, family, money and business. I always inquired about their experience with rideshare driving, and the response was inevitably something like this:

UBER DRIVER: “Oh, it’s pretty good. On a good day I’ll make a hundred bucks, sometimes even two hundred if I really work it and stay up late.”

MMM: “Is that your profit after subtracting the cost of driving?”

UBER DRIVER: “No, that doesn’t include gas. But I’ll only use, like, not even a full tank – maybe thirty bucks”

“Hmm”, I would think to myself.

“If this driver is burning through $30 of gas, (twelve gallons), they’re probably covering over 250 miles. Whether they realize it or not, it’s costing them $125 in direct car costs before even accounting to the damage to their health or the risk of injury. Thus, the net profit might be as low as $50 for a big day on the road, or five bucks an hour.”

There’s no way Uber could be such a successful company if the pay rate were really this low. Is there?

But on the other hand, some of my Uber drives to the airport have included a Dodge Ram pickup truck (V-8 engine, fancy wheels, bought brand new on credit), a BMW X5 and even a Hummer H3 (with over 250,000 miles on the odometer). Maybe people really are that  uninformed about the cost of driving. As my friend Bill said when we talked about this:

“Imagine developing a company specifically to take advantage of people’s ignorance of how expensive it really is to drive their own car. What would this company look like? “

(the answer is of course that it would look like very much like Uber or any other ridesharing company)

To resolve this mystery (and as a way of getting some test miles on my new electric car), Mr. Money Mustache decided to go deep undercover in September 2016, and sign up as a driver for both Uber and Lyft services.

The Initiation

Using another driver’s referral code, I signed up on the Uber system and started to follow the instructions. I needed a background check, medical exam, car safety inspection and a few other daunting things. Luckily, Uber runs facilities called “Greenlight Centers” which put all this stuff in one place. The closest one to me was about 40 miles away in Denver, so I charged up my new Leaf and headed down.

When I arrived, I found an interesting scene that nicely personifies our new sharing economy. It was a mashup of an Apple Store and the DMV. Modern design and furniture, good music and glossy tablets everywhere, combined with an ocean of slightly desperate and bored looking people waiting to start their new driving careers. And Mr. Money Mustache, trying to blend in.

It was a funny feeling, spending those three precious hours of my Tuesday morning, waiting in queues and filling out forms. I was keen to learn about the driver experience and how things work in the New Economy. But I also felt a bit of the nervous “I’m applying for a new job” energy of the other applicants, and like a bit of a fraud for being here when I had absolutely no interest in truly having a job.

There was a trendy little cafe in the corner of the room, so I strolled over and picked up a Clif bar and a coffee. Due to my naive privilege as a former tech worker, I expected it all to be free – after all, don’t all offices offer free coffee and snacks, along with a keg of local beer and another tap for Kombucha? But a man popped out from around the corner and rung me up for $3.85. On top of that, it was a bland coffee in a small cup. This was an interesting reminder that working in a lower-training job is a different world than the one you and I probably both inhabit, here at the top of the economy.

When the process was finally done, my 25-year-old Uber concierge looked up from his iPad and issued me a genuinely warm congratulations and we shook hands.

“So that’s it?”, I asked

“Yeah! That’s it! You could go out and get in your car start making some money RIGHT NOW!”

“Hmmm…”

“Nah”, I thought to myself. “Eighty miles of driving plus three hours in an office building is more than enough wasted indoor time for me for the next little while.” 

The spoiled retiree in me loves hard work, but only the right kind of hard work. The sedentary locked-indoors variety of work always falls to the bottom of the list. As you can tell by the low frequency of these blog posts.

My First Ride

Eventually, I was ready to give it a whirl. I cleaned up my car, stuck the Uber decal on the windshield, put on some nice clothes, mounted my phone on a sturdy dashboard clamp, and fired up the app. Within minutes, I had my first ring.

RIDE REQUESTED! John, 5 minutes away.

The ring was deafeningly loud, because (as I later learned after half an hour of looking unsuccessfully for a way to change it) the Uber app overrides your ring volume setting and sets it to !!MAXIMUM!!  I was so startled that I could hardly slide the “accept” button, but I eventually got safely on the road. I recognized the address as Longmont’s “Pumphouse” brew pub, right downtown.

I headed down the hill and scoped the area, and eventually found John. As he hopped in the car I slid the “start trip” button and his destination was revealed as the local Marijuana shop, just 1.9 miles away.

John and I exchanged pleasant conversation and he was impressed by the quick silence of the electric car. I dropped him off at Native Roots and then parked nearby, expecting another fare to pop up just as quickly.

Ride 1: 5 minutes waiting, 5 minutes driving, 1.2 miles unpaid, 1.9 miles paid. Net fare to me: $3.37

But the second fare wasn’t quite as quick. Fifteen minutes later, the Uber app rang again. It was John, now properly restocked and thrilled that I was still there in the weed shop parking lot. We headed back to the Pumphouse.

Ride 2: 15 minutes waiting, 5 minutes driving, 1.9 miles paid. Net fare to me: $3.37 … plus TIP $5.00!

Hey this wasn’t so bad: that five dollar tip really brought up the average. I was thirty minutes into my career and up about 12 bucks, minus five miles of car costs.

After another five minutes of idle time, the app rang again. This time it was a suburban address listed as 12 minutes (which turned out to be almost four miles) away. I decided to take the ride anyway, in the spirit of experimentation.

I got to the house, but nobody was there. After a minute, I used the Uber app to send the customer a text message. “Oh sorry!”, he said, “My phone GPS isn’t working well because we’re inside so it probably shows us in the wrong place! We’re just on the next street.”

I drove around a bit more and eventually found the young couple, and the app revealed a nice surprise: they were headed all the way to Boulder, which was over 12 miles from this part of Longmont. Surely now I would start earning the big bucks.

After 24 minutes of smooth, expert driving and pleasant conversation, I dropped them off at a restaurant. But I was surprised to see that the total wasn’t that impressive:

Ride 3: 10 minutes waiting, 4 miles unpaid, 12.4 miles paid. Net fare to me: $13.96. No Tip.

Driving in the Happening City

Now I was in Boulder, which has a much bigger scene than Longmont. Everybody is rich, every night is a big night, the University of Colorado is right downtown and it’s all action – there are no real suburbs. Due to high rider demand, the city operates in a perpetual “Surge Mode” which means Uber Fares are 20-30% more lucrative, and there is virtually no wait time for fares. And now, I was right downtown. So the app shrieked its notification tone immediately.

The customer was only a mile away, but due to the incredible slowness of trying to drive a 14-foot-long, 3300 pound Racing Wheelchair in a dense city it took me a lot of slow gliding in traffic and waiting at long traffic lights to get there. It was a couple of younger guys, heading back downtown.

We slogged through the dense traffic yet again at roughly one third of bicycling speed, and I earned my five dollar fare.

The app rang again, and I saw from the map it was yet another non-downtown person, probably looking for another ride downtown.

I decided not to play this game anymore, contributing to car traffic in a city that needs fewer cars. So I let this ride request go to another driver and set my destination to Longmont, hoping to find a customer heading that way so I could get paid for the ride home. There were none.

So I flew the Leaf back along the highway to home, and stopped at the grocery store to pick up some fresh food and a free battery charge for the car.

Total stats for the day:

4 Rides
1:51 hours
18.6 miles unpaid
17.2 miles paid
$32 including tips
~$18 of car costs
roughly $7 per hour net


Ongoing observations

After joining Uber as a driver, it was easy to add on a Lyft license: you can submit scans or photos of the same examination info to both companies. So over the course of 2017, I fired up both Uber and Lyft apps many more times to do some more driving and collect some more observations. I tried night driving, special events, and quite a few different parts of the metro area. I had a lot of fun, but made very little money.

  • One time, I was summoned by a 13-year-old girl coming out of the middle school, effectively turning me into Mr. Schoolbus Dad. After finding her in the school lineup, she directed me to the elementary school, where we picked up her little brother. I dropped them both off safely at home in a rusty suburban area nearby. (note – readers have since informed me that this shouldn’t have even been allowed, as you must be over 18 to summon an Uber. She must have been using her mom’s account, and I was apparently breaking the rules by not knowing them)
  • Another ride was from a college student, deep in the Colorado U campus. It took me forever to navigate the throngs of after school foot and vehicle traffic and find this young lad in the crowd. During the ensuing 3MPH transit of Boulder, I couldn’t help but remark, “Wow! I apologize for how slow this trip is going. I’m usually on my bike when I cross Boulder, which is a lot faster.”
    Our final destination was a strip mall, and he directed me meticulously through the entire parking lot so he could be let off within 20 feet of the front door of the restaurant. End fare for about 35 minutes of work, even with surge pricing, was another six bucks. My resolve to avoid driving cars in Boulder was reinforced.
  • My favorite times to be a driver were Friday nights. It was fun to feel the energy of people going out on the town, and find out what was going on.  I could see Uber driving to be a good escape for single people looking to meet new friends (or romances), because I almost always got along well with the customers, often exchanging business cards or email addresses with people when we found something in common.
    On longer rides with people over 30, the topic almost invariably led to life, business, and money, which led to Mustachianism, which led to me admitting my secret identity. Thus, some of my past Uber customers may even be reading this article today(?)
  • But in the end, it was hard to stay motivated to keep doing this experiment. There is just usually something better to do than driving around in a car, and I wasn’t willing to sacrifice too much of my life to gather more data. And with the financial gain of rideshare driving being negligble, I am surprised that there are so many people who do it.

How to Make the Most of a Low-Profit Situation

Still, as with everything in life, I did my best to optimize Uber driving for both fun and money. From my experience as well as reading online forums, the best way you can do it is:

  • Use the referral and bonus system heavily. Actual driving doesn’t pay well, but I have seen bonuses pop up on my app offering between $100-$500 to refer other drivers. There are also “weekly guarantee” offers that come up occasionally, offering more pay in exchange for meeting a certain threshold.
  • Use the lowest cost and most fuel-efficient car you can find. Uber requires you to have a fairly new (under 10 years) car, so get something on the older side of that spectrum, but with low miles. A 2009 Prius, for example, uses less than half the fuel of most cars of similar size.
  • Focus your driving around on “Surge Pricing”. By watching the app throughout the days and months, you will learn when your area enters periods of higher demand. Special events like Halloween, late weekend nights or major league sports events are popular times.
  • Try to find trips involving highways. Since you get paid mostly by the mile, you earn almost ten times more money at 60 MPH than you make in on a long trip through central city where you might average only 6 MPH. (There is an “hourly” component to your wage as well, but it is incredibly low, somewhere in the single digits per hour.)
  • Experiment with the “set destination” feature to filter for rides going your way. Taking fares with you on your commute to work or to an airport.
  • Make the most of your downtime: there will still be lots of waiting between fares. If you bring a book, podcast, laptop or make business-related calls that help you learn a trade that pays more than driving, you can get yourself into a more lucrative trade.

Suggestions for Uber and Lyft

During the course of this experiment, I happened to receive emails from relatively senior people at both Uber and Lyft for unrelated reasons. So I took the opportunity to make some suggestions to make things friendlier for drivers:

  • Report the total driving time and miles for each ride and each shift, clearly specifying paid and unpaid miles and hours.
  • Provide drivers with an estimate of the car costs incurred, and estimated hourly earnings after these costs.
  • Allow drivers to specify the types of rides they are willing to accept. For example, “only ring me for riders within 1 mile”, or “I would like to be paid for for both pickup mileage and rider mileage.”
  • Provide drivers with the details of where the person is going, or at least how long of a ride it is. Right now, Uber has all this incredibly useful information at the time of booking, but deliberately withholds it from the driver.
  • And here’s the best one:
    Instead of setting a reasonably high price per mile (around $1 in my area) and an almost-zero-dollars-per-hour rate for the driver’s time, let’s do the opposite:
    – 50 cents per mile, which just covers the cost of the car
    – plus 33 cents per minute (driver’s net after Uber fees), which is about $20.00 per hour.
    This has many benefits. It reduces any temptation for drivers to rush or break the speed limit. It makes urban trips (where nobody should be using a car anyway) more expensive. It makes more necessary highway trips cheaper. And it guarantees that if a driver has a customer in their car, they are not losing money.

I was surprised that both companies immediately dismissed all of these suggestions, with a round of vague excuses. This was a disappointment to the Economic Libertarian in me, because it seems obvious that  an open market between buyer and seller is the key to more efficiency.

In fact, early in my driving career I learned how much the unpaid driving was hurting my profitability so I stopped accepting distant fares. The app quickly sent me this note:

 

Yeah, right. How about you just stop ringing me with fares that are ridiculously far away, or give me the opportunity to GET PAID FOR THE DRIVING, instead?

When these companies deliberately tilt the field, they are being sneaky, which causes them to lose public trust, which causes the public to vote in a bunch of sclerotic regulation to protect the drivers and the public. If you, as a company, just avoid being a dick to people in the first place and treat them with complete openness and good old-fashioned honesty, they are more likely to let you run free.

Since I started this experiment a year ago, Uber has fallen into a world of trouble and bad publicity. Their internal culture of sexual harassment was blown wide open, along with the misdeeds of the wild and temperamental former CEO. From specific programs to evade government regulation to annoying treatment of drivers, Uber triggered a widespread backlash which became the #deleteuber campaign. Saying “Uber” is now a bit like uttering the words “ConAgra” or “Philip Morris” or “Exxon”.

Meanwhile, from the very beginning I noticed a friendlier tone in the way Lyft operates – see this 2016 interview with Lyft more laid-back founder John Zimmer.

In the End..

In general, I really want companies like Uber and Lyft (and Tesla, AirBnb, Google, Amazon and many of the other tech companies that have been stirring things up so much lately) to succeed, because the benefits to all of us greatly outweigh the inconvenience of the disruption.

For example, some people worry about what will happen to driving jobs as self-driving vehicles gradually take over. But I’m excited about the ways this can make our lives safer, quieter, and less expensive as we give up on owning personal cars, ride bikes much more, and use automated cars as a service whenever the bike is impractical. Technology provides a lumpy ride, but it also provides change which is an essential ingredient in every human life to avoid getting into a rut. So, share on.


Further Reading: How Big Oil Will Diean interesting walk through the changes today’s technologies have already set in place – leading us very quickly to a place where nobody in 2010 would have even guessed.

 

this sentence surely made you ask, “but what about the BUS, Mustache?!?” – good question. Of course I’d always choose biking, then public transit as the first two options, but the airport is 45 miles away (well over 2 hours by bike) and the bus requires a transfer in Denver, which makes it even slower than biking. Also, both Uber and Lyft have referral programs which give you credit for referring friends – I still have a few credits in my Uber account.

If you want to try Uber or Lyft, sign by randomly choosing one of these codes from friends, and you’ll get $10 off of your first ride (and give a small surprise to some of the members of the MMM-HQ coworking space!)

Uber #1

Lyft #1 Lyft #2 Lyft #3

  • j84ustin December 4, 2017, 10:33 am

    “When these companies deliberately tilt the field, they are being sneaky, which causes them to lose public trust, which causes the public to vote in a bunch of sclerotic regulation to protect the drivers and the public.”

    They ALWAYS deliberately tilt the field, which is why we have to regulate them.

    Reply
    • Mr. Money Mustache December 4, 2017, 1:57 pm

      Not always – there are also plenty of responsible companies that exist mostly to improve the world – Google and Tesla, for example. They may or may not go sour someday in the future under new management, but for now, the less we interfere with these companies, the better.

      Reply
      • Susanne December 4, 2017, 2:17 pm

        While I do like the promise of Tesla, it needs to be said that they are burning through cash at astonishing rates. They have never made a profit, and at some point, new investors will stop coming, and what will happen to the company when that happens? It’s the same with Uber. I love the service, it’s fantastic, but the company simply makes no profit. You can only burn through your investor’s cash for so long before something bad happens.

        We are in one of the longest economic expansions in living memory, what will happen to these companies if stocks tumble and the struggle for liquidity begins in earnest?

        Reply
    • Susanne December 4, 2017, 2:13 pm

      And how do companies usually tilt the field? With the help of government power of course. You think Big Pharma is afraid of regulations? Or Big Oil?

      Reply
  • c1ue December 4, 2017, 5:04 pm

    Mr. MMM,
    Your experience replicates my own. I was developing GPS related applications in 2014 – and one possible one was better navigation for Uber/Lyft drivers (back then the apps didn’t automatically redirect to map apps).
    50% to 100% more miles were driven to pick up passengers vs. actual paid miles. Besides driving down the driver’s revenue, this also ensures that drivers cannot get more than a bit over 2 rides per hour.
    More importantly, the additional mileage driven means that ride sharing is just shifting parked cars onto the street. A significant part of the traffic jams in major urban centers is exactly due to this phenomenon.
    Even in 2014, before successive rounds of fare decreases, driving for Uber/Lyft didn’t generate a living wage. It can only be worse now.

    Reply
  • Expat AJ December 5, 2017, 5:48 am

    Hey MMM, thanks for the awesome blog and the food for thought it contains. I just found your blog last month (and wish I would have years ago) and this is the first time I felt like I had something to contribute.

    I haven’t owned a car in about 5 years. I use my bike 5-6 days a week for short shopping trips and getting to work (which i also take on a train ride to work with me). Occasionally, I’ll use a car sharing serivce to go shopping for bigger things I need to purchase that would be unwieldy on a bike or public transportation. That being said, it has crossed my mind to do something like Lyft or Uber to justify getting a car. But this usually only happens when the public transportation is really delayed several days in a short period. I probably won’t get another car anytime soon and, once I do, probably wont be driving for Lyft or Uber. However, that’s just context, not the purpose for my comment.

    On the occasions I rent a vehicle, I tend to travel very different routes from the ones I would on my bike. My bike I tend to take the shortest distance, but in the car I may take a longer distance trip that is actually quicker. They are two very different mindsets, and the car driving one tends to come with experience. This difference in travel route selection can also be seen when my girlfriend sometimes comes along for the car trips. She doesn’t have a license and has on several locations questioned why I am not going the way we go on bike. I usually have a good reason (for example, two lanes turning into one, more stops, etc. On the route we would take by bike) for why this longer way would be faster. However, she hasn’t had to think like that with her bike.

    Perhaps the travel was so much slower in the car than on your bike, because you were traveling routes that may have been shorter distance but were not the faster.

    Reply
  • SeaGuy December 6, 2017, 2:39 pm

    And here I am in Seattle driving mixed hours part time mainly.
    I did $33k revenue on under 20k miles driving. When I did 2 nights a week Fri and Sat night only for months I consistently made $2k for 8 days .

    So here’s the deal, it’s tier. Many of my rides were on XL/Plus or surged regular rides. Don’t chase rides all around town. Know the spots of demand.
    I am currently in process of buying a new car (Tesla) do get rid of my 1099 $10k tax bill. Yep driving profitably is
    No good as you just owe plenty in taxes.
    So I may upgrade car, use actual expense method for deductions and plan on doubling my revenue while keeping miles low.

    It’s all area and demand dependent.

    2 years and counting , wish me luck ha.

    Reply
    • Mr. Money Mustache December 6, 2017, 3:06 pm

      Would a Tesla really save/make you more money? I get the impression that the capital cost and depreciation are very high on those things. For example, the 19-22″ ultra-performance tires can cost 3-4 times the amount you’d spend on Prius tires.

      Reply
  • Chris December 6, 2017, 7:16 pm

    What kills me about the low pay of Uber, is that I made around $11 an hour delivering pizzas for Dominos back in the mid-90’s. Adding up the sucky hourly pay, gas stipend (per mile), and tips, most of that $11 was tax free. After my normal 8-9 hour day, I worked 10 hours a week, which payed my rent, and also covered (most) of my beer costs (which was substantial for a guy in his mid 20s)…. I don’t know what it pays to deliver pizzas for Dominos today, but it’s still gotta be alot better than Uber. (even if your car smells like a pepperoni pizza half the time)… Sounds like Uber is a sucker’s gig….

    Reply
  • Michelle December 9, 2017, 9:04 pm

    I do Airbnb (a private room in my home) and they are just as unappreciative of their hosts as it sounds like Uber is with their drivers. They make a lot of decisions that indicate they value their guests more than their hosts. It’s sad that they forget the hosts are the ones who make their business even possible. There is quite a bit of animosity at times on the hosts forums because they ignore our complaints, and on occasion I feel frustrated enough I want to leave. I’m still doing it though as I do enjoy the guests (or at least the majority of them, ha) and the money coming in is nice. O:-)

    Reply
  • Doug December 18, 2017, 11:04 am

    I have no desire to drive for Uber, but recently have been using my car for a contract food delivery service. Here are the delivery rates I get, in Canadian Dollars. 0 to 6 KM $4, 6 to 10 Km $6, and $8 for 10 Km or more. Most deliveries are under 6 Km. Here are my observations:

    Advantages:
    – Very low barriers to entry, the ad said: Got a car, got a phone, got a job. No lengthy interviews, dealing with hiring prejudices or jumping through a lot of hoops to get hired on.
    – Most companies pay about 50 cents per Km if you use your car, you’re getting those rates or better with this company.
    – You pick the shifts you want to work, great if you like part time work only.
    – You have a certain amount of autonomy, nobody bothers you as long as you don’t have consistently late deliveries.
    – If you have an older small car and keep your costs per Km down the car costs won’t kill you. Plus you get to deduct car costs for business from what you make when filling out your income tax. Make sure you keep track of all that stuff. My thoughts are I have a car with all that capital sitting there, I’m paying fixed costs like insurance and licensing whether the car is being used or not so why not utilize it to make a few bucks on the side?

    Disadvantages:
    – You won’t get rich doing this kind of work, even if you work a lot of hours it will be barely enough to make ends meet. You’ll need another source of income, in my case from investments that pay a decent yield. Add to that if you look at what you make divided by the hours you work you’ll probably be below minimum wage. As I said above, it’s to make a few bucks on the side and I’ve been working evenings only.
    – You’re not being paid anything for the distance travelled from your last delivery site to the next restaurant. Luckily the system keeps that distance short, the person closest to the restaurant is the first one to get a request from the app.
    – The busiest nights are ones with the worst weather because less people want to go out in this weather. During a snow squall, I had very little idle time, just one delivery after the other. That can be good or bad depending on how you look at it.
    – As MMM said, if you have a newer car or a big fuel guzzling car or SUV, it’s simply not economically worthwhile to do this kind of work.

    Reply
  • Menard Solve January 5, 2018, 12:19 pm

    Thanks for going the extra mile to check on Uber. I was planning on doing the same thing so I can blog about it.

    By the way, has anyone ever told you that you have a striking resemblance to Justin Timberlake?

    Reply
  • Spencer February 23, 2018, 8:31 am

    Freakonomics had a neat episode about Uber a couple weeks ago:

    http://freakonomics.com/podcast/what-can-uber-teach-us-about-the-gender-pay-gap/

    There’s one insight about how adding tipping didn’t really increase the per-hour wages (around the 42 minute mark). With tipping now added to the app, there are more drivers out there, hoping to capitalize on the extra dollars per ride. The extra supply of drivers increases the collective drivers’ idle time, driving the per hour wages down (as much or more than the wage increase from tips).

    I wonder if you could apply this type of logic to your 5 suggestions for Uber and Lyft:
    – The first 2 suggestions would essentially make the actual costs/earnings of drivers more transparent, and on seeing that their wages are less than previously thought, there would be a decrease in drivers.
    – The second 2 suggestions allow the drivers more discretion in the rides they pick, effectively reducing the number of available drivers.
    – I have no idea how the fifth suggestion would affect things, so I’m going to ignore it.

    So these first 4 suggestions could decrease the supply of drivers, and therefore reduce the idle time, driving up the hourly wages. So in summary, the drivers who misunderstood their overall costs/earnings would leave the system (suggestions 1/2), the drivers still around would have more control to pick the more profitable rides (suggestions 3/4), and the net wages for all drivers would increase.

    Even if things worked as ideally as this for drivers, I don’t think Uber would do this, at least not yet. They still (as far as I know) depend on Silicon Valley subsidies to keep fares low, so their strategy is to dominate the ride-share market, and then increase prices slowly to wean themselves off the subsidies. So if their goal is currently to increase market share, they want as many drivers on the road as possible, so they wouldn’t want to implement suggestions 1-4.

    I certainly agree that more should be done for cost transparency and ride discretion for drivers, and I’m certainly not a fan of the “drive out the competition, then drive up the prices” game. The drivers get short-changed in the short term, and riders get screwed in the long term when rates go up.

    This podcast is a bit old now, but also pretty informative about Uber, and pretty funny. http://thedollop.libsyn.com/271-uber

    Reply
  • Mark March 2, 2018, 2:48 pm

    Looks like a MIT PhD and a few grad students came to the same general conclusion you did, albeit with a more formal study methodology.

    https://beta.techcrunch.com/2018/03/02/mit-study-shows-how-much-driving-for-uber-or-lyft-sucks/

    Reply
  • Simone C. March 4, 2018, 10:20 am

    It looks like the stats are even worse than you reported in your experiment:

    https://www.theguardian.com/technology/2018/mar/01/uber-lyft-driver-wages-median-report

    If this is true, the whole Uber/Lyft business is a scam toward unaware drivers.

    Reply
  • Alissa Ricci March 6, 2018, 7:21 am

    Reply
  • Fay March 7, 2018, 8:05 pm

    Reply
  • Shannon March 13, 2018, 3:16 pm

    MMM, you are so handsome! I want to marry you!

    Reply
  • Wallet Squirrel April 26, 2018, 7:12 pm

    I loved this article Mr. Money Mustache!

    Thanks for doing this experiment! I added your hourly rate to my example of Uber driver hourly rates (https://walletsquirrel.com/how-much-do-uber-drivers-make/). Many of the studies done on Uber pay aligned pretty well with your experiment, however you were the only one to stress the variable of waiting around for rides, great addition!

    Thank you for sharing!
    Andrew

    Reply

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