Today, driving for Uber sucks. The pay is too low and the customers are not great. With the global pandemic, business is down a lot. This post highlights what it was like driving for Uber back in 2016, when it was all the side-hustle range.
I never planned to drive for Uber. It just happened. When I pulled up to a gas station to fill up Rhino, my 2015 Honda Fit, there was a fella setting up a tent that promoted a free $50 gas card if I signed up to become a driver.
“No obligation to drive!” he tempted me, so I figured why not. With gas prices rebounding from their lows, what used to cost me only about $26 to fill up now cost $35. Moose, my old 2000 Land Rover Discover II sucked down $80 – $100 a tank, so in comparison $35 isn’t so bad.
After uploading my driver’s license, registration, and inspection form, I waited to get a confirmation via text or e-mail. Twenty-four hours later and nothing. I went back to the nearby gas station the next day and asked what was up? He said he didn’t know, and that I should e-mail support. So I did. He gave me another $50 gas card for my troubles. And then another $50 gas card for referring my friend in my passenger seat. YES! Who doesn’t love free money baby?!
Several days later, I finally heard back from Uber via e-mail, and they said they had wrongly entered my information. But if I simply logged in and re-uploaded everything again, all would be fine. When I logged into my account via my laptop it said, “Get a $100 bonus if you go down to the driver center at 130 Vermont Street to get everything set up.” So instead of re-uploading everything myself with no guarantees, I just went down to the driving center given I planned to be close by anyway.
After about 10 minutes of paperwork, the inspector said I was good to go. “All you’ve got to do is download the Uber partner app, take a selfie, and Go Online! After your 10th ride, you’ll get a $100 bonus for coming down to the driving center, and another $300 bonus after your 20th ride for signing up via our gas station promotion.“
Wow! $400 worth of bonuses plus another $150 in gas cards. So that’s where Uber is spending all their billions raised. The offer was too tempting to not try things out. Now let me share with you my first Uber passenger experience, some earnings figures, and the emotions I experienced over the next couple of weeks driving.
MY FIRST UBER PASSENGER
In general, I’m relatively fearless when it comes to trying new things. But I felt more anxiety than I have in a really long time during the moments right before I pressed the “Go Online” button in the Uber Partner app. I likened the feeling to being the new kid on his first day of school. Exciting, but scary!
Within three minutes of going online, my phone starting beeping for a pickup. Of course, I was inconveniently on one side of Van Ness Avenue, a busy three lane road, and she was on the other side. After five minutes of wasteful navigation, I picked up a woman in her early 40s standing outside of Rhino’s home, The Honda Dealer. It was 11:38 am.
I welcomed her into my car and re-confirmed her destination address she inputted into the app. It was important to be sure we were going where she wanted and buy myself as much time as possible to process everything as a newbie. The Uber driver’s center mentioned that every passenger rates their driver from 1 – 5 stars, and that if I fell below a 4.6, I’d be put on probation or removed. With the first rider, everything was at stake!
After going through the formalities, we were off to some random warehouse south of San Francisco. Then she said something random. “Do you serve brunch as well?“
I chuckled and told her unfortunately I didn’t.
She went on, “Oh my gosh, I had such an amaaaaaaazing night last night!“
“Yes, I met a man outside of a bar moments after closing and I went back to his place!“
“Whoah! Sounds like an adventure,” I responded. Trying to be more professional, I tried to change the subject. “Are you visiting from out of town?“
“Yep, from Denver. But I just love San Francisco! It’s so fun, and there are so many nice men here!” She answered. “I’m so bored with my family life back home. I asked my husband whether we could have an open marriage, and he was pissed I asked!”
“Hmmm. I see.” Now I was curious. “Did you guys actually hook up?“
“Well, no. Not all the way. He was on Molly and couldn’t get it up! But I still got my rocks off!“
When we got to the warehouse, she wouldn’t stop talking. Luckily, Uber pays 29 cents a minute while a passenger is in the car. It was almost as if she wanted me to give her my number the next time she was in town or something.
After sliding the “End Ride” function on the app, I was prompted to give her a rating. Of course I gave her 5-stars. She was entertaining! She gave me the same.
And that, my friends, was my first experience as an Uber driver.
DRIVING FOR UBER CAN HELP MAKE ENDS MEET
Some of you might be thinking I’m crazy to drive for Uber. Wouldn’t my time be better spent working on my online business or consulting, especially given I’ve got my passive income optimized? Yes, from a financial standpoint, I could make more elsewhere, but from a journalism perspective, it’s important to experience driving first hand before writing about the ins and outs of the ridesharing business. Driving for Uber is like research!
I want to do things that are new and fun to keep things interesting.
Driving for Uber allows me to answer the following questions:
1) How much can you actually make after paying commission, gas, and maintenance costs?
2) How does the whole thing work exactly? From signing up, to getting paid, and not wanting to drive to Timbuktu if you have somewhere to go.
3) What are the stories behind the people taking Uber?
4) Is Uber really a good investment at $50 billion?
5) Will the sharing economy allow more people flexibility to work and live the way they want?
After giving over 100 rides, I’ve come to the conclusion that Uber is a good way to make money for those of you who are in between jobs, underemployed, or would like to spend time with family during the day. You can drive whenever you want and start making money usually within 10 minutes of turning on the Uber partner app.
Check out the times I drove after completing my first full week. With 100% accuracy, I avoided all 16 of the busy hours where I could make more money due to their famous surge pricing.
I really dislike traffic and really enjoy my freedom, which are the main reasons why I didn’t drive during the busy hours. I’ve also discovered a driving hack where if I’m planning on playing tennis or going downtown (east), I’ll turn on my Uber partner app and with an 80% probability, I’ll pick up someone close by my house heading the same direction. It’s an easy way to make $11-$29 dollars.
So how much did I actually make this first full week driving for ~17 hours? Have a look at my chart.
$528.47 ain’t bad for driving at most 3.5 hours a day. I was basically averaging about 2.7 trips an hour. If you’re getting excited about my earnings, study the chart carefully. First, you’ll notice that Uber takes a 25% commission for drivers in San Francisco, which is a lot, especially since the commission is 20% in every other city. Then, you see I got a $100 “Other” income, which was my promised $100 bonus for going down to the Uber driving center at 130 Vermont Street to get checked out.
In other words, my normalized earnings for doing 46 trips was really only $428.47 ($528.47 – $100 bonus). If I do 2.7 trips an hour on average, that’s around 17.3 hours of work, or $25 an hour after paying 25% commission, but before gas and other expenses.
So what about gas? Well, that was easy to track because I used up the $50 gas card Uber gave me that one week. Hence, take $50 / $428 = 11.7% in gas cost. Let’s just round it to 10%, because I still had gas in the tank when I got to the next week. I’m now paying 25% commission + 10% gas + ?% eventual maintenance to drive. That’s right. Before you pay taxes, you’ve got to give up roughly 35% of your gross earnings!
Notice how my acceptance rate went down from 96% the first week to only 81% the second week. This is because after gaining some experience, I realized how inefficient some pickups are. I’m not willing to drive more than six minutes to pick up a passenger to send them on an average 10-minute ride. Sometimes the app says I’ve got to drive 10 minutes to pick someone up since I was already out in the boonies. I did once, and they decided to cancel! At least they gave me $5 cash and they were charged a $5 cancelation charge.
The other important data is my overall rating of 4.97 for the week with a rating system between 1-5. For some reason, I really cared about my rating even though I wasn’t even close to getting put on probation.
FEELINGS OF SADNESS
Instead of experiencing continued excitement, like a kid who just got a new toy, I started feeling tremendous sadness shuttling people around for money. I felt like I was rewinding my life back 24 years to the days when I got yelled at for not making the perfect Egg McMuffin while making only $3.65 an hour. I felt trapped, with the lure of the next fare pushing me to keep on going.
I’ve got a 2015 leased econocar for $235/month that’s covered under warranty, so my maintenance expenses should be minimal for the next three years. But let’s realistically say after Uber commission (25%), gas (10%), and maintenance (5%), I’m only pulling down 60% of my gross earnings of $35/hour. That’s $21/hour before taxes, which gets cut down by another 25% or so for a net after tax earnings of $15.75. One accident or maintenance mishap could easily blow a week or two weeks of earnings out the window!
$15.75 in net earnings is barely enough to survive in an expensive city like San Francisco. Even if I worked 40 hours a week, I’d only bring in $2,520 a month. I guess I could share a crummy 2/1 apartment in a bad area with another person for $1,200 a month. But with only $1,320 left to spend, I’ll be stuck spinning my wheels forever. Such a far cry from the $500,000 a year couple I profiled, who are also stuck in neutral!
Heck, to pay for my master bathroom construction would require me to drive 3,682 hours! That is depressing.
The other thing that gets me down are some of the people I meet. I picked up one early 20s Hispanic woman who was kissing her baby goodbye before handing her precious over to her mom when I arrived at 6:30am. I was in a lower middle class area of Daly City, about 10 miles south of San Francisco. The woman got in Rhino, all sleepy eyed and confirmed Portrero Hill as the destination. Right before arrival, she told me she was going in early to do the 7 am – 11 am shift at Wholefoods so she could get some lunch before working another four-hour shift at a retail store in Fisherman’s Wharf, three miles north of there.
Life can’t be easy for this woman. I kept on thinking in my head: You go girl! You are so awesome for working hard. Don’t give up! May you and your child have a great future! I felt proud of her work ethic and I felt proud to be an American.
APPRECIATE WHAT YOU HAVE
For the longest time, I’ve felt that life should be pretty easy if you work hard, be a nice person, and take some calculated risks. But after speaking to over 100 passengers, I’m reminded that life is not so straight forward. There’s so much luck involved with getting ahead. It’s hard to get a true idea of how lucky we are without hearing other people’s stories.
I wonder how on Earth the two kids I dropped off in the Projects can successfully compete against private school children with all the tutoring money can buy. Is the mother who works a minimum wage job at Wholefoods destined to forever stay stuck in similar occupations? It’s a shame public transportation is so bad or housing is so expensive that she has to take a $14 Uber ride. How will she ever get ahead?
I question the sustainability of Uber’s business model, which keeps cutting fares to the point where all they’ll have are drivers who simply sign up for the free $50 gas card or the up to $300 driver bonus after giving their 20th ride.
Uber should make every single Uber employee sign up to be a driver and give at least 20 rides themselves. This way, they’ll gain first hand experience on how to improve their product and empathize with the growing chorus of ridesharing drivers who are just trying to make ends meet, but can’t. They say there is a legal reason why they can’t, or else they’d be all over it.
My Uber experience has been extremely humbling, and I’m thankful for it. But driving for Uber today is not worth it. Save your time and money!
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Updated for 2021 and beyond. Uber has finally gone public and is worth some $100 billion!