[elements]

If a driver does 15 shifts per month (which would be a pretty lazy schedule for most full-time cabbies I've talked to), you're looking at roughly $1500 per month just to use the car. A quick google search indicates that the MSRPs for top-of-the-line Toyota Camrys and Chevy Malibus (just a couple of cars I thought might be well-suited to the task) are around $30,000, which, at 3% over 5 years, would require a monthly payment of about $540. But let's round that up to $600 to cover taxes and anything else that might be rolled into the loan.

As for insurance, I think $200/mo is probably a conservative guess. I pay way less than that as a 20-something male driving a "high risk" vehicle.

That brings us to $800/mo, leaving $700 to cover maintenance. I'm sure maintenance costs would be quite a bit above average given how much the car is driven, but I can't imagine they'd come anywhere near $700/mo, especially in the first five years (the term of the loan). After the car is paid for, you can either continue to drive it if it's cheaper to do that, or you can sell it for a few thousand bucks and start over. Plus, you don't have to buy your own car, since you've already got it, which would save you a few hundred every month.

Not exactly an in-depth look at the issue, but it seem likely that you're better off owning your own vehicle.

Unrelated, but my worry (for the drivers, anyway, both full-time and casual) is that given the low barriers to entry, a lot of people who own vehicles already will see how they can make some decent money on a casual basis with just slightly higher maintenance costs, and before long, there will be enough UberX drivers that the amount of time spent waiting to get a fare will bring the hourly wages down considerably. Maybe they'll limit the number of new drivers after a point or something, I have no idea, but I'd be concerned about that if I were a driver.

Not exactly relevant, but I was chatting with one UberX driver a few weekends ago, and she told me that the company sends each driver a monthly spreadsheet of metrics for that driver, allowing them to track their own performance. I thought that was interesting.

[hnnewguy]

>As for insurance, I think $200/mo is probably a conservative guess

Conservative? I think you are severely underestimating the cost of obtaining insurance that covers the liability of injuring multiple passengers that you are transporting around as a "for hire" driver.

Much like AirBnB, people seem to overlook this cost and responsibility. That will change when an Uber driver slams into another car with 5 passengers, killing someone, or an AirBnB user, there "illegally", burns down an apartment complex. It will be the end of these businesses.

I'm not saying that these models can't work. But right now, much of the cost advantages come from working around regulations.

[dnautics]

the ridesharing companies provide insurance on top of personal insurance. Both Uber and Lyft have $1M liability + casualty insurance while you're transporting passengers, and Lyft has $1M policy while you're not (don't know about Uber on that one).

The insurance premiums for these companies (I know Lyft partners with Met Life) probably is adjusted downwards relative to taxis, because of several factors, but the biggest one being that the drivers own their own cars and are out of it if they wreck it, so there's a good reason not to drive dangerously. A larger proportion of Uber and Lyft drivers have been driving american streets for longer periods, and also have educations, for whatever statistical benefit that confers. Finally, the taxis are, in the end, smaller companies, so the rideshares can negotiate better deals and also provide far more statistical data to the adjusters, which enables a narrower margin.

[hnnewguy]

>Both Uber and Lyft have $1M liability + casualty insurance while you're transporting passenger

Well, I'm not going to claim to be an expert on such matters, but I believe $1MM is the minimum that is offered for liability insurance on a driver's policy here in Canada. I'm not sure how far that'd go if you killed multiple passengers in a vehicle accident, especially if you were found negligent.

Again, this isn't to say that these are insurmountable problems, by any means. You can insure anything for the right price. But how many people are actually sufficiently insured? And how many users are checking, or even care? I can't see this not being a problem in the future.

[dnautics]

A quick google search indicates that the MSRPs for top-of-the-line Toyota Camrys and Chevy Malibus (just a couple of cars I thought might be well-suited to the task) are around $30,000, which, at 3% over 5 years, would require a monthly payment of about $540

The car you want to be driving for this task, if you are making a new purchase, is a used hybrid. A used honda insight goes for ~$16k, monthly payment on a five-year is $250/month with not very good credit, gets 34mpg while running, and you don't have to really worry too much about making payments in case you lose your job, your car, or both.

[smackfu]

Do other cities have limits on the number of cab licenses, like the medallions in NYC? Those are often owned by the large cab companies, and not available to purchase since they are at the cap, so there is not even any option to go it alone.