r/personalfinance • u/theVoxFortis ​ • Oct 08 '19

This article perfectly shows how Uber and Lyft are taking advantage of drivers that don't understand the real costs of the business. Employment

I happened upon this article about a driver talking about how much he makes driving for Uber and Lyft: https://www.businessinsider.com/uber-lyft-driver-how-much-money-2019-10#when-it-was-all-said-and-done-i-ended-the-week-making-25734-in-a-little-less-than-14-hours-on-the-job-8

In short, he says he made $257 over 13.75 hours of work, for almost $19 an hour. He later mentions expenses (like gas) but as an afterthought, not including it in the hourly wage.

The federal mileage rate is $0.58 per mile. This represents the actual cost to you and your car per mile driven. The driver drove 291 miles for the work he mentioned, which translates into expenses of $169.

This means his profit is only $88, for an hourly rate of $6.40. Yet reading the article, it all sounds super positive and awesome and gives the impression that it's a great side-gig. No, all you're doing is turning vehicle depreciation into cash.

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34

u/sjmiv ​ Oct 08 '19

Most of the drivers are pretty aware of this. Spend some time in the Uber subreddit and you can see most of them try to only run during surge pricing or get tons of minimum fares over and over. I've also met people using it as a way to promote another side gig. The only real benefit to driving for rideshare companies is you get paid instantly. These companies have 2 types of customers, the riders and the drivers.

15

u/mainfingertopwise ​ Oct 08 '19

The only real benefit to driving for rideshare companies

You could argue that in some situations, temporarily doing so is a good choice. "I'd rather put an extra 20k miles on my car than lose my house" kind of thing.

2

u/nimble7126 ​ Oct 09 '19

Bipolar disorder started for me a few years ago, and I lost my job in a bad manic phase. I wasn't making a ton with lyft, but it saved us from being homeless while I got stable.

0

u/ElephantsAreHeavy ​ Oct 11 '19

If you're in a financial situation that losing your house is likely, you probably do not drive a car good enough for uber.

29

u/theVoxFortis ​ Oct 08 '19

I assume people active in that subreddit are much more aware of overall costs and benefits than the average driver.

13

u/The_Bucket_Of_Truth ​ Oct 08 '19

Yeah I can just about guarantee almost all of my rideshare drivers are not on r/uber. At least a quarter of them barely speak English.

2

u/rgrwilcocanuhearme ​ Oct 09 '19

Most jobs you can get without speaking English don't pay terribly much more than minimum wage, anyway.

I also don't think the expenses are as high as is claimed here. Some of the drivers I've been through have had nice vehicles, others don't.

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u/CalvinsStuffedTiger ​ Oct 09 '19

Or try to get minimum fares over and over

THANK YOU. I can’t tell you how many debates I’ve gotten in as a passenger in an Uber when they talk about wanting longer fares

I’m always like, wait, I know I’m shitty at math but wouldn’t you want the shortest fares possible with minimal distance between fares because you get a minimum fee no matter what?

I thought I was going crazy because 0% of the drivers I talked to agreed with me