By on July 16, 2014

Uber iPhone

Uber wants to do more than disrupt the traditional taxi service, seeking to bring its pricing low enough to replace your own vehicle, period.

Jalopnik reports CEO Travis Kalanick spoke with The New York Times about a 20 percent cut in pricing on UberX rides in New York, and explained what he’d like to see happen as far as his service is concerned:

The whole point of price cuts is to get UberX pricing below the cost of owning a car. Let’s say you take three or four trips a day on average. If we can get the price of UberX low enough, we can get to where it’s cheaper to take Uber than to own a car.

He adds that while that’s currently easier said than done — there are only so many drivers to go around — and that the cuts are temporary, if Uber can expand its reach through lower pricing, the service would turn a profit even if it makes the cuts permanent. Kalanick also claims his vision would benefit all involved, from providing more jobs in New York to riders getting more for their dollar.

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20 Comments on “Kalanick: UberX Could Become Cheaper Than Owning A Car...”

  • avatar

    …or this could become the greatest serial-killer/rapist/murderer tool known to man.

    There is no way that law-enforcement or the city government is going to allow these programs to exist.
    Mark my words, the first time a crime is committed, laws will be passed to make these apps illegal.
    The taxi companies refused to allow their monopoly to be broken.

    Here in New York City we have what are called “Jamaican dollar vans”.

    Ford vans, driven by Jamaicans, they helped take the pressure off of the bus which sometimes are either late or on strike.
    Every single time the police see these vans, they pulled them over and make sure that they are fully licensed and obviously paying taxes to the city.

    I have no problem with that.

    But it also means that there is no way the police are going to allow regular people to act as cabdrivers or ride sharers. If the city and the state and the feds don’t get their cut then you don’t either!!!

    • 0 avatar

      Have you tried Uber? It’s like getting a taxi, except:
      – it’s a nice big sedan or Suburban
      – it’s new and clean
      – the driver knows where he is going and the fastest way to get there
      – it arrives when you request it; no more just sticking up your hand in the middle of rush hour hoping a taxi will eventually come along
      – it’s cheaper
      – you pay by phone, which is linked to your credit card. Easy peasy.

  • avatar

    So, are we gradually transitioning to an Uber-based economy? Will all the cars I see commuting in each morning be an Uber-taxi? Can I get a degree in Uber management from the University of Phoenix?

    • 0 avatar

      There are a lot of drivers for whom insurance, taxes and parking are really expensive. A typical $300/month car payment is more like $900/month for them. In that environment, spending $25/day on Uber and maybe $150 once a month on Zipcar or Avis is a good substitute.

    • 0 avatar

      You can give your significant other an anniversary present of free Uber rides. You can also give your mother-in-law a “just because” present of a free Uber ride cross-country.

  • avatar

    Rather than trying to figure out how to regulate Uber (et al), perhaps the local government could reduce the regulatory hurdles for the taxi(s).

    • 0 avatar

      taxi’s for the most part did this to themselves. They wanted a monopoly on the system, and worked with government to create one. Now the means to work around them have been created and they are all cry foul.

      Whereas for years they pushed for fewer licenses, expensive medallions, and in places like new york, and probably others, a single car to be the taxi.

      • 0 avatar

        Regardless of the taxis’ behavior, any time the politicians can acquire an additional revenue stream (without drawing the ire of the majority of voters), I’m convinced they’ll take it.

  • avatar

    VoGo: Agree all, but have you used UberX? It’s a little different than straight Uber (black cars/SUVs). The UberX drivers are not necessarily professionals, and the cars are a little more mundane, in this area (DC) lots of late-model Camrys.

    That said, I’ve used UberX and Uber several times, and they’re still vastly better than horrible taxis in this city. The UberX rides in particular have all been:
    -On time
    -Polite drivers with good hygiene NOT TALKING ON THEIR PHONES
    -Immaculate, quiet cars with working climate controls
    -Each car is tracked in real-time through the driver’s app
    -Most important, unlike a normal taxi, the driver’s continued employment is contingent on your satisfaction and rating

    For these reasons and more, I feel vastly more comfortable with my wife riding in an UberX alone than a taxi, and I think the serial killer scenario is pure fear-mongering. Especially in DC, the stories of rude and even criminal behavior, sexual harassment and assault in particular, by traditional cabbies are epic.

  • avatar

    I’m not too sure about that because a $2000 beater car and liability insurance is pretty cheap, especially against the example of taking 3-4 trips a day even if you have to pay out the nose for parking any time you drive anywhere.

    • 0 avatar

      Looking up prices a $2000 car would be a 2001 Civic with 224,000 miles on it or an 2004 Sable with 196,000 miles. Would that be reliable enough for a professional person to get to work every day? Keeping in mind that parking in NY, SF, Boston etc. could be 250-500/month?

      • 0 avatar

        That’s what I thought. I’m thinking the $2000 beater is fine for non-daily use, but you wouldn’t want to rely on that car.

        Parking in downtown Boston runs $500/mo or about $25/day with the “early bird” rates.

        I live relatively close to work (3-4 mile drive), and a round trip on UberX is less than $25/day.

        If you’re going cheaper in Boston, NY, SF, your are likely taking public transit to work, not buying a beater for daily commuting. No one seems to pay $6k/year to park their $2k car.

  • avatar

    I’m still unclear how insurance is handled for these vehicles. I thought, for example, that my own automotive policy does not cover me if I carry passengers for hire?

    As with AirBnB, these concepts seem predicated on ignoring limitations to insurance and other contractual factors already in play between the drivers (or in the case of AirBnB, apartment tenants) and their insurers, landlords, etc.

    So the old adage seems to apply, unless I misunderstand something: it’s all fun and games until somebody gets hurt.

  • avatar

    I’m an Uber driver in the Hampton Roads area of VA and the sign up process was actually pretty intense.

    First off, all Uberx cars have to be 2005 or newer and a 4 door vehicle of some type for the most part. Part of the process is sending them photos of insurance, DL, and multiple photos of the exterior and interior of your vehicle. You then go through a backround check and DMV record check. In order to continue to be an Uber driver, your first 20 rides are immune from ratings, your 20-50 rides, you must maintain at least a 4.2 driver rating and after you’ve completed 50 rides, you must have maintained a 4.6 rating or your service gets cut off.

    • 0 avatar

      “Part of the process is sending them photos of insurance”

      This is one of the bones that I have to pick with Uber. Was there any special requirement on the insurance? Did it have to be a commercial policy or did they only require standard auto insurance?

  • avatar

    Seems we have heard the “Period” thing before.

  • avatar

    How can ANYONE who lives in a city defend the current taxi system???

    -Polite drivers with good hygiene NOT TALKING ON THEIR PHONES
    This shit now happens 70% of the time. Cell Phone usage loudly in foreign tongue. Polite and hygiene … a bonus if you get it.

    In Chicago, in isn’t the tax. It is the medallions — which are now up to $350k. City only gets money when they sell a few.

    Medallion holders are rent seekers. The chances of a driver buying a medallion and working his way up the food chain ??? Zero.

    Driving in a city is not fun. OK … can be fun in a totally demented way. No one with a decent car would try though.
    Only shitmobiles.

    Anyone with any real money uses car services and would never drive. Even if you have a parking spot @ condo, you gotta park anywhere else you go. I have found my usual places where valet fees are negotiable, but does anyone really want to do that.

    On and on and on

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