[brodouevencode]

They could raise rates but also run the risk of losing customers at the margin. Uber and Lyft are publicly traded companies and, as such, are required by their stockholders to maximize profit - which means raising rates, lowing costs (labor), or some mix of that (and more).

The problem here, as I see it, is that the model changed from being highly accurate (payment per mile, which can happen in a minute) to something more broad (payment per 15 minutes according to FLSA rules as I understand them).

[JumpCrisscross]

> are required by their stockholders to maximize profit

This is a myth.

[brodouevencode]

If that's not it what is it?

[SauciestGNU]

"Fiduciary duty" can mean a lot beyond maximizing profit, but generally acting in good faith to advance the interests of the company is enough to satisfy that.

[Ekaros]

So they choose to lose all the money instead some? Is that really in best interest of their stock holders?

[brodouevencode]

When it comes to market viability there will come a time at which companies just pull out because the headache is too much, even if they are somewhat profitable.

FWIW I think this is posturing on Uber/Lyft's behalf, but is almost certainly a sign of future actions if they cannot make the number work.

[Jensson]

They would have to invent a new business model to operate with an hourly minimum wage. Currently they demand very little of their drivers since they don't have to pay when the driver doesn't have a client, but add an hourly minimum wage and now they have to manage drivers a lot more to ensure they are worth that pay per hour.

Now they will get replaced by more traditionally run taxi companies that managers their drivers tighter.

Edit: Or no, the law explicitly said how much ride shares should pay per mile and per minute riding. So scratch that, not sure why they pulled out here.