[SpicyLemonZest]

Vehicle depreciation is one big example. Any commercial vehicle operator knows that driving a car around causes its value to decrease substantially, 29 cents per mile on average as of 2018, and will (must!) account for that when running the numbers on their business. But most individual drivers don't have the expertise to intuit this, and Uber and Lyft don't tell them. So all but the most financially savvy drivers have an effective income significantly lower than they believe.

[AnthonyMouse]

> Any commercial vehicle operator knows that driving a car around causes its value to decrease substantially, 29 cents per mile on average as of 2018, and will (must!) account for that when running the numbers on their business.

People are always saying this and then you go to KBB. The average car is >12 years old, so let's suppose you're going to get rid of your Prius when it's 12 years old instead of allowing it to become older than average. Typical mileage at that age might be around 150,000 miles. Trade in value in good condition for a 12 year old Prius with 150,000 is ~$4300. Double the mileage to 300,000 miles, it drops to ~$2600. That's $1700 for an extra 150,000 miles, or around $0.01/mile.

$0.29/mile is from new or nearly-new cars which are then resold as nearly new. If you buy a new car and immediately roll the odometer past six digits its value is going to fall off a cliff. But if you start with a ten year old car which has already lost most of its value to depreciation, and then put a lot more miles on it over a couple more years -- which is what most of the people driving for Uber would actually be doing -- the cost is dramatically lower.

Presuming that the people choosing to do this as a profession can't figure this out is kind of patronizing, but, in the common case, not even that much of a difference.

[chongli]

Uber requires that your vehicle be less than 10 years old and in good condition as well as pass an inspection from a licensed mechanic. You can’t just go ahead and grab a 12 year old clunker and run it into the ground unless you’re only planning to do food deliveries (which have no restrictions on vehicle quality).

[AnthonyMouse]

> Uber requires that your vehicle be less than 10 years old and in good condition as well as pass an inspection from a licensed mechanic.

Uber requires that your vehicle be less than 16 years old:

https://www.uber.com/us/en/drive/requirements/vehicle-requir...

Plenty of 10-16 year old vehicles are in good condition and will pass an inspection.

You can keep a vehicle in good condition indefinitely because vehicles are made of modular parts and parts can be replaced as they wear out. Whether this is worth doing depends on the expected frequency of future repairs, which in turn depends on the specific make and model (there's a reason the most common ride sharing car is a Prius), how well the car is maintained and how stupid you drive it, but most cars continue to be worth maintaining rather than scrapping until they're 20-25 years old. Which is why the average age of vehicles on the road is just over 12 years, implying that they last approximately twice that long.

[chongli]

I’m in Canada. Uber has different rules for vehicles here. Though now that I check the 10 year requirement has changed since I wrote that comment.

Perhaps someone from Uber saw my comment and updated the requirements. If so, they must’ve been working on the weekend!

[AnthonyMouse]

It does appear to be 10 years in Canada:

https://www.uber.com/ca/en/drive/requirements/vehicle-requir...

This is presumably some kind of regulatory requirement since it's jurisdiction specific. But even selling the car at 10 years old under similar conditions still causes the depreciation to be less than $0.02/mile.

On the other hand, that's around an extra $1000 over the life of the car, and who is to blame for that increase in costs on the driver? It's not as if 10 year old cars are meaningfully safer than 12 year old cars, nor would non-trivial numbers of people be using significantly older cars than that to begin with. Is this really just the Canadian government screwing the drivers for want of something to do?

[chongli]

It might just be a weather thing. 10 year old cars in Canada can be almost completely rusted out unless the owner has been diligent about rustproofing and washing the car frequently during winter. It’s all that road salt slush that splashes all over the car underbody and sticks to it, causing horrible galvanic corrosion.