Author Topic: Uber/Lyft have defective business model?  (Read 2366 times)


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Re: Uber/Lyft have defective business model?
« Reply #30 on: March 06, 2018, 07:22:23 PM »
I think thatís a fallacy. Having a huge fleet of cars is going to be expensive to set and expensive to mantain - Itís today and it will always be. Having a real and huge network of cars/drivers on demand an the digital ecosystem supporting that network is the most valuable thing here.

As mentioned in my post, I think car companies themselves and rental car companies are natural competitors.  Car manufacturers should have some advantage by making the cars and rental car companies do maintain a large fleet of cars.
 Uber/Lyft don't maintain any fleet of cars today.

Just as anybody can replicate the ITunesí model (but in reality is not just that easy!), anybody would be able to replicate Uberís model but itís not going to be that easy!

I don't think Uber's current model is easy to replicate, but I think the AV one will be easier.  At least because the two-sided network mentioned above, will become one sided.

In any event, I don't think the margins will be there.  As I understand it, right now, Uber loses a ton of money, and that is without a very good deal for drivers.

I think the question/proposition above was that the company or investors or someone says that they can make money with a shift to AV.  So, AV has to be not be better than the human driver model.  It may be better from a customer standpoint, but I think it will be easier to replicate and, so, a tougher business for Uber.

Could be wrong for a lot of reasons.  Uber could be under-earning during its growth phase and it could be profitable today.  Perhaps they will have a subscription model that will reach such scale that it will be difficult to compete.  Perhaps other competitors won't enter the market.  Lots of other things I could be missing.

But, if I had to guess, I'll stick with my original answer.

Rental car companies may be competitors, thatís certainly a possibility. My way of looking at this is that even though there are companies owning the rights to some music or movie, there are others having the distribution channel necessary to market that. The same way that some company owning the technology to make the best cellphone is not necessarily the same selling the most phones.

Just because there are companies manufacturing cars that doesnít mean they will be good marketing or providing a service with those cars, not that they will be able to compete with the leader. History proves that manufacturers are good doing that, manufacturing (and not even that!).

About the business sense and margins I donít know. I havenít studied the model and I would not bet on any company, Iím just stating that I think there will be money to make in moving people within cities and towns and Uber looks like the leader.
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Re: Uber/Lyft have defective business model?
« Reply #31 on: March 13, 2018, 01:16:45 PM »
Anyone else follow the bike sharing/rental space? Broadly speaking I feel the various competitors in the bike rental sector are where Uber/Lyft will be if/when autonomous vehicles become common place. Each has to maintain a massive inventory of bicycles and concentrate them in locations that best match demand. It's a race for each company to move into new cities and areas where demand is underserved and be the first in the market establishing what passes for a moat in the sector because people in that area have your app on their phone and are used to using your bikes. I think a lot of parallels exist between the current state of competition in this space and where Uber/Lyft and other ride sharing companies could end up, racing to establish themselves as the sole player in numerous smaller markets while pouring capital into more competitive markets.