I’ve been holding off on posting this because we all know you can have a bad day here and there. But I’ve had a string of four bad days in a row. So bad, that the $5.33 (net – before car expenses) I earned per hour today looks really good!
Two days ago I took in a grand total of $0.90 per hour. Unbelievable I know, but it’s true. I worked three hours. I got one $7.00 (net) trip. I paid $4.30 in tolls going back and forth to the airport seeking passengers. Not a single ping at the airport. Came home and called it a day. $7.00 minus my $4.30 in tolls left me with a grand total of $2.70 for three hours of work, or $0.90 an hour.
Now you can see why the $5.33 seems so awesome! It’s almost 6 times more than the day before!
The day before yesterday I didn’t drive. A friend called and asked why I wasn’t driving. I told her I lost my motivation. She asked why. I told her I only got one trip in three hours the day before. She said, “Get back out there, some days are bad but others are okay.”
So yesterday, I drove again… and to my amazement, it was even worse than the day before. I got one minimum fare trip – in get this – 5.5 hours! Yep, it was better than the day before when I incurred all the tolls. It came to $1.27 per hour. But if I had incurred the same tolls seeking a pickup at the airport my hourly total would have been just $0.49! However, I learned my lesson the day before about incurring those tolls.
This is all so appalling in light of Uber’s recent fare cuts and their promises that we would be busier than ever. Well, I’ve never been this idle. They told us they had tested the fare cuts in many markets around the country and the results were in. In every market where they had slashed fares, they told us demand had skyrocketed and drivers were earning the same as they were before (of course with a lot more work and wear and tear on the car). So I gave them the benefit of the doubt. I thought maybe they knew something I didn’t. But I’ve been sorely disappointed in these results in my market (northern New Jersey – right across from New York City).
Oh, and to add insult to injury, when I got home yesterday there was an email from Uber to drivers saying they were going to pay us BIG money if we would help them recruit new drivers! They were going to pay something like $200 for each driver we recruited. And if we recruited at least three drivers they would give us a $500 bonus. Five drivers, I think earned a $900 bonus and the next level earned you a $1,500 bonus. Great! They already have so many more drivers than they need that I’ve sat for hours on end, day after day, without a single call – and they want us to help them recruit even more drivers!? Who would bother?
Why, when they know so many drivers are going passenger-less all day long are they in seemingly such desperation to take on thousands of new drivers? It just doesn’t make any sense. Unless… unless their real goal is to get everyone in America who owns a car to drive for them. It sounds ludicrous but it’s the only possible explanation I can think of for their actions.
It’s really amazing that all these seemingly smart people haven’t come up with a smarter strategy. I’ll throw out what I think a smart strategy would be and see what you think about it. I think the smartest strategy would be first to raise prices back to where they originally were – a little above cab fares. And I say that for two reasons. One, the price would speak to the quality of service they provide (or used to provide). And at that price people would think it’s a great value. Sure, it’s a little more than a cab ride, but the service is not just a little better but it’s far better. Uber would then earn a long-term reputation for quality and great service. And with higher fares, drivers would be able to afford nicer cars and keep them in better condition. Thus ensuring that the Uber fleet would always be far better than a taxi fleet.
But, higher fares aren’t the only solution. Along with higher fares, Uber also needs to do one other thing. They need to be far more selective about the people they take on as drivers. They need to meet them in person to make sure each driver will project the kind of high-quality image Uber should want to project. They also need to actually look at each driver’s car to make sure it meets high standards. And they should require drivers to have their cars brought in once every six months for a free inspection by Uber staff – to make sure the driver has continued to maintain the quality of his car.
By doing these two things it would change everything for the better. It would mean that Uber drivers and the Uber fleet would be consistently of high quality. And customers would come to trust that a call for an Uber will always get them an excellent car and driver.
The other day I actually had occasion to use an Uber and I was pretty shocked at the state of the guy’s car. It was old. It had over 100,000 miles on it. He was a college kid and he had done a very smart thing. He bought a cheap used car to use for Uber. Very smart financially speaking. But he had cloth seats and right in the middle of the backseat was a big ugly stain. The outside of his car was pretty dirty too. I literally felt like I was getting into a cab. And that’s when it occurred to me that these cheap prices Uber is setting are only going to lead to a degradation of the fleet which will result in clients having more doubts about the quality they can expect when they call for an Uber.
When drivers are struggling just to pay for gas and tolls they certainly aren’t going to get their cars washed as often as they once did. And they’re not going to be able to maintain them in pristine condition, nor will they be able to afford cars as nice as they once could. Once the Uber fleet begins to degrade, Uber’s image will also degrade in customers’ eyes. This will be the end of Uber as we’ve known it. Uber 2.0 is a significant downgrade and it won’t be long before this reputation catches up to them. It won’t be long before customers begin to notice. And once the Uber fleet is not much better or different than taxis, customers will be right back into taxis.
For most of this last year customers in Hoboken and Jersey City were so delighted with Uber they didn’t really notice that it cost a bit more than a cab. People used to tell me they didn’t even care if it did. They were just so happy to get a great car with a great driver who showed up quickly. But if Uber keeps following this path they’re on, I predict in another year customers will be saying there’s really not that much difference between Uber and cabs. Uber cars will be older, dirtier, drivers will be less fluent in English and there will be fewer Uber cars on the road resulting in longer wait times for customers. Those are exactly the problems that had customers fleeing cabs and rushing to Uber!
Uber used to have a very upscale image but at reasonable prices. A year from now however, if nothing changes, all the money and effort they put into building that image will be wasted.
More benefits to raising prices and limiting the number of drivers (i.e. being more selective and only taking the best of drivers) would be not only that drivers would have better cars, but also that there would be less driver turnover and each driver would have more experience. It takes a while to learn your way around even in a city you’re familiar with. Because customers will always take you to places you never knew existed! But after you’ve done it for about a year, you really start to know all those nooks and crannies of your city. And passengers can feel the difference between a driver who has to punch everything into his GPS and one who really knows how to get there. But Uber’s current strategy will only result in an extremely high turnover rate which will result in drivers who are less knowledgeable and less sure of themselves. And Uber should never think that customers don’t notice that.