Yes, i feel the pain too

We all run across the frequent posts about the low rates paid by Uber/Lyft - true, and especially true if you are not driving an SUV/black (I don’t). I don’t mind the posts - I feel the pain as well.

HOWEVER, we need to understand that ** rates ** are ultimately a supply and demand based set of numbers.

Ultimately, the rates paid by Uber/Lyft are not going to go up - until the ** number of drivers available to work at those rates ** start going down. Or demand rises to the point where drivers are no longer plentiful. While it might make you feel better, no amount of complaining is going to help the situation.

Uber and Lyft have continuously lowered their rates - because they found people were still willing to drive at those lower rates. Usually Uber will lower rates; Lyft follows some time later.

There are occasionally calls for strikes, class action lawsuits etc. but I am not touching those topics in this post and if you do not mind, avoid those in the comments for this post as well.

But I do find drivers can help themselves by being cognizant of certain factors related to their income.

  1. That screeshot you poted saying you earned $228.74 yesterday is NOT your earnings.

First off, that includes Toll Reibursements. If you paid $20 in tolls, deduct that right off the bat - $228.74 - $20 = $208.74 to get a more accurate number. This is actually a number that Uber and Lyft could show you but understandably, they want to make your earnings look as high as possible. But it is easy enough to calculate if not shown (perhaps a bit more painful in the case of Lyft).

  1. It does not include regular ongoing costs of operation - primarily fuel, but also expenses you incur because you are driving - snacks, water, other amenities if you do, your own coffee/food that you would not have paid for if you were not driving. They are real expenses (even though you might had similar expenses doing some other job).

  2. That ‘booking fee’ taken out from what the passenger pays is actual money Uber and Lyft collects and keeps. Do I really care that this is claimed as being used for specific purposes such as cost of development? No. Uber and Lyft has certain costs of operation - and breaking it down into categories should be an ‘internal’ thing at the companies. If the passenger paid $6.50, and the booking fee is $2.50, and service fee/other fees is $1.15, the amount collected and kept by Uber or Lyft is $3.65 (2.50+1.15) and the amount the driver got was $2.85. In this example, U/L kept 56% of what the passenger paid. Parts of it may be used for whatever purposes - but it is still 56%. This ‘booking fee’ is not something one would normally care about - UNLESS one is talking about how much percentage U/L takes. If you talk about that percentage, make sure to include booking fee as part of the U/L take.

One thing I do find is that many drivers often overestimate their income, and in that sense, fool themselves to a degree (please *** I do not intend any disrespect to any driver *** we are all working hard to make some money here).

**** It is highly likely that a good precentage of drivers do not keep track of how much they really make after expenses. Doing that requires all U/L income and U/L related expenses to be tracked separately. ****

This is not too hard to do if you use
a) a separate checking account for Uber and Lyft income (not absolutely mandatory but otherwise you have to manually add up the transactions, and possibly store in a spreadsheet)
b) a separate credit card for all U/L expenses (almost a must)
c) you can pay the monthly balance on the credit card from the above checking account
The above method alleviats the need to maintain extensive tracking on an ongoing basis.

  1. Make sure to include costs of maintenance (tires, oil change, other wear/tear) - usually I will take the average over a year and divide by 12 or 52 to get a monthly or weekly number. Placing these expenses on the separate card will help to quantify them.

  2. Loss of value of the car (depreciation) or lease costs, car loan interest etc. (as applicable). This is probably the hardest one to calculate.

  3. Insurance costs specifically attributable to rideshare driving.

There is one significant factor that is not even quantifyable: the added risk taken by an U/L driver in terms of probability of getting into an accident - simply because they drive so much more. Even if they are great drivers, others on the road are not. No driver is getting compensated for taking this risk.

In summary, I am trying to make two points here:

  1. Uber and Lyft won’t stop reducing rates till they actually start losing driver counts (or some other major legal change happens such a reclassification from contractors to employees). No amount of complaining to fellow drivers is going to make this happen (however, it might make you feel better)

  2. Drivers need to track their REAL income after expenses and then decide if it is worth it to drive. The answer is likely yes in most cases (as of now), but in a few cases may change to no once reality sets in (or when rates drop even lower).

Aplologize for the very long post. Hope you did not get bored reading.

There are various reasons put forward for rate drops. What I am saying is:

No company pays more than what they are required to pay to keep employees and contractors - and that is based on market rates - what rate will they still work at?
(Minimum wage is an exception to this rule).

If they are lowering rates, it is because they feel that they can, without losing drivers in any significant way.

I don’t blame Uber and Lyft - any company will attempt to reduce their operational expenses.

Drivers simply need to take measures to determine their true income and make an educated decision on whether to drive or not - at the real rates and not inflated numbers.

Uber/Lyft reduce rates gradually over a period of time - because they do not know at what rate they will have a significant loss of drivers i.e. they are experimenting with it as well. If, tomorrow they suddenly lost 50% of their drivers because of a rate drop, believe me, they will reverse that drop in a heart beat.

Whatever works to track income and expenses easily. Not sure how Lyft will work with Uber debit card in case you decide to drive for Lyft as well.

Generally all true. Actually rates have gone up slightly since 2017, but surges, etc. have plummeted! Yet, at this writing, there’s a whole crop of new drivers coming online-making payments on new/late model cars that get poor gas mileage, and are saying they make good money!

it is easy to get fooled - at least initially - by the inflated income numbers. One of the main reasons for my post was to provide some additional insight into this to new drivers.
It is a certainty in my mind that new drivers get pummeled with rides thus giving a false sense of income level. This drops off once the drivers continues to work beyond a few weeks. Nothing illegal as far as I can see. Unethical? You be the judge of that.

My U/L car is a long-paid off eight y/o Subaru that averages 27 mpg and I use one bank acct for rideshare. At best I’m netting about 2/3rds of total earnings and it’s getting worse by the month.

At least you seem to be tracking real income very well.
Do keep in mind that your car might still be losing value - even though not as much as a new car. If you are using it exclusively for rideshare, then you have insurance costs as well.

Sorry but you need to Understand that Uber and Lyft determine their own rates. Supply and Demand influence their decisions, algorithms they they write might calculate the rates but in the end it’s the companies that choose the rates they are going to charge.

of course, they set the rates. But the point is - there is no need for them to pay higher rates than what the drivers are willing to accept. No business pays more than what they have to - just like your driving business attempts to reduce expenses by trying to find the lowest cost gas. Would you pay higher for gas if the pump operator complained that he is barely making a living at his rate - or will you chose the pump next door that is cheaper?

That is why it is important that drivers have a good idea to how to calculate real income and not the numbers thrown out in the apps.

I get what you are saying, but answer this why is the service fee $1.50 on one ride but $30.00 on the next? What changed? Lyft/ Uber provided the same service for both rides, it’s the drivers who provided a different service, "cost of gas, cost of tires, cost of brakes, cost of every thing we as drivers spend. Lift / Uber are taking more money for the service “WE” provide!!

U/L attempts to recuperate their expenses - PLUS MAKE PROFITS - whichever way they can. Are their fees in proportion to their costs for a given ride? Of course they are not. There are rides on which they lose money. I know because I have had rides where, for example, I got $7.30 while the passenger told me they paid $5 something - because they had some kind of promotion. Businesses do this all the time - prices of goods are rarely proportional to cost of goods, for example, in the retail business.
We cannot tell U/L what structure they should use to make profits. It is always a business decision. But drivers CAN tell them at what income level they start dropping off. That is why calculating real income (not getting fooled by app reported incomes) is extremely important.

Ok, so start being more competitive with the “Cabs” and start paying drivers a little better. Don’t show what the customers pay, like Lyft.

They should. My point is - they won’t. Not till rates drop to a point where driver retention becomes a severe problem for them.
What drivers can do is to keep track of their actual earnings, not some numbers that U/L would like drivers to believe they are making.

But the rate of acquisition of new drivers more than compensates. If you ever wait in airport queues, for example, see what the average queue size has been over a period of time. Where I drive, it only gets larger and larger. I believe what I see.

Personally I do not believe that 96% of the drivers drop out in a year. No, I don’t have data. But no, I do not believe 96% reported by some reporter who does not have access to actual data either. You are welcome to believe that 96% drop out in a year. I do not. In any case, that does not account new drivers.

Rates set by U/L vary from market-to-market, IMO, based on what U/L think will be rates acceptable to drivers in each market. Due to higher gas prices in CA compared to TX, it seems less likely that CA drivers will accept the 0.60 cents/mile U/L pays in TX - so U/L pays more in CA.

All this is great except…1) if you do NOT provide drinks, snacks etc…theres no costs and 2) if you do not do it FT, do it PT and sporadically during surges and high demand and 3) if you never have tolls, etc (which I never do) and many others do not…the earnings WILL reflect correctly

They just need to break it down to how much it cost per day to drive
And survive at the place they live to how much daily they make .
Knowing what you can not spend a day to what you are allowed to spend is very important on if you will be able to make money

What ironic is I find most people incorrectly inflate their costs. making them think they earn less than they actually do, by adding expenses they would incur regardless of whether or not they drove for Uber/Lyft.

If you stop driving for Uber tomorrow you’re still going to have to pay your car loan (if you have one), your normal insurance, maintain your car and depreciating it by driving it.

For example my car drives an average of 70 miles a day for a commute and usually gets two to three or oil changes a year.

So these cost should NOT be included in how much it costs you to drive for Uber.

You should only include the miles you occur while driving for Uber and the maintenance cost but above and beyond what you would normally do any given year.

So you have driven 161,000 so far. Let’s say (just for an example) 100,000 miles was from Uber driving and 61,000 was from NON-Uber driving.

You would figure out the depreciation from the 100,000 Uber miles when determining you subtract from your gross earnings with Uber.

20% is non Uber.
But you need to also go in to your factory log book figure out a spreadsheet of when parts and oil change and fluid change is needed how times you will need to replace and then price of replace items added it all up and the divide it by 365 days it will give you a daily value it cost to move your car .i set mine to 50 a day goes into a envelope for future maintenance and then 25 a day for replacing the car now at the end of the year you may have 18000 and change from the 50 if you have no maintenance but you will have maintenance
Now what left you can put over for next year or go on a vacation or add to the 25 a day that’s 9000 a year about .
Now gas must be factored in every ones got different cost mine was 60 a day car payment and insurance is going to be different for people as well

60+50+25+ 30 I can not touch 165 a day if I want to operate right don’t care what a write off is at this point due to they won’t wait for the irs to pay the bills

the costs vary depending on the situation of the person.

Not all possible expenses are there for every person - for example someone pointed out that they do not pay tolls. Someone else pointed out that they do not have car payments etc. For many with vey old/high mileage car, depreciation may be negligible. Some may not even buy gas because they have an electric car and the cost of running one may be negligible.

But whether big or small, every driver needs to know what they are, and know what their real income is. If it is reasonable, then it would not make sense to complain. Others, on the other hand, may find the expenses so high it might even be worth the risk of driving so much.