256
Uber and Lyft are quitting Minneapolis over a driver pay increase
(www.engadget.com)
you are viewing a single comment's thread
view the rest of the comments
view the rest of the comments
this post was submitted on 15 Mar 2024
256 points (98.5% liked)
News
37208 readers
288 users here now
Welcome to the News community!
Rules:
1. Be civil
Attack the argument, not the person. No racism/sexism/bigotry. Good faith argumentation only. This includes accusing another user of being a bot or paid actor. Trolling is uncivil and is grounds for removal and/or a community ban. Do not respond to rule-breaking content; report it and move on.
2. All posts should contain a source (url) that is as reliable and unbiased as possible and must only contain one link.
Obvious biased sources will be removed at the mods’ discretion. Supporting links can be added in comments or posted separately but not to the post body. Sources may be checked for reliability using Wikipedia, MBFC, AdFontes, GroundNews, etc.
3. No bots, spam or self-promotion.
Only approved bots, which follow the guidelines for bots set by the instance, are allowed.
4. Post titles should be the same as the article used as source. Clickbait titles may be removed.
Posts which titles don’t match the source may be removed. If the site changed their headline, we may ask you to update the post title. Clickbait titles use hyperbolic language and do not accurately describe the article content. When necessary, post titles may be edited, clearly marked with [brackets], but may never be used to editorialize or comment on the content.
5. Only recent news is allowed.
Posts must be news from the most recent 30 days.
6. All posts must be news articles.
No opinion pieces, Listicles, editorials, videos, blogs, press releases, or celebrity gossip will be allowed. All posts will be judged on a case-by-case basis. Mods may use discretion to pre-approve videos or press releases from highly credible sources that provide unique, newsworthy content not available or possible in another format.
7. No duplicate posts.
If an article has already been posted, it will be removed. Different articles reporting on the same subject are permitted. If the post that matches your post is very old, we refer you to rule 5.
8. Misinformation is prohibited.
Misinformation / propaganda is strictly prohibited. Any comment or post containing or linking to misinformation will be removed. If you feel that your post has been removed in error, credible sources must be provided.
9. No link shorteners or news aggregators.
All posts must link to original article sources. You may include archival links in the post description. News aggregators such as Yahoo, Google, Hacker News, etc. should be avoided in favor of the original source link. Newswire services such as AP, Reuters, or AFP, are frequently republished and may be shared from other credible sources.
10. Don't copy entire article in your post body
For copyright reasons, you are not allowed to copy an entire article into your post body. This is an instance wide rule, that is strictly enforced in this community.
founded 2 years ago
MODERATORS
As a whole, yeah, but top-line losses don't mean each ride makes them less profitable. My understanding was their margins are slim enough they need a lot of rides to subsidize their fixed costs, so fewer rides means less profit, not less loss.
If Uber is actually profitable, stopping operations in Minneapolis really should make them less so. If this isn't them taking a small loss now because they believe they'll avoid a bigger loss later, I can't make sense of it.
Yes, they could make a very tiny profit from a decently sized city, but then it might encourage other cities to follow suit.
The costs are not all fixed, covering another city means paying more support agents, having people signing up local drivers, etc. so after this change it might not even be profitable after all
That's my point though?
If costs like support agents that scale with rides make the rides unprofitable, their business model is upside down. Especially for Uber, I'm counting costs that scale with rides with costs per ride, vs infrastructure and truly fixed costs. Maybe they're so close to breaking even per ride that raising costs depresses demand enough to make them unprofitable, but it seems a lot more likely they're doing this to send a message first and foremost.