Uber will surely have a place in the future of transport, but history suggests that profits will be hard to come by
enjoy a good moan. But few can match the satirical indignation of a former ferry operator, John Taylor, who used to carry passengers on the Thames. As well as being a “waterman”, Taylor was a poet, writing in the 1620s just when horse-drawn Hackney carriages were making their debut on the streets of the capital. In “An Arrant Thief”, published in 1622, he described the carnage from “upstart Hell-cart-coaches” robbing his brethren of their fares.
Look through history, though, and taxi monopolies look anything but impregnable. That is because the ride-hailing business, which will remain Uber’s bread and butter for the foreseeable future, is local, not global. And, as long as competition is unregulated, entering local markets is relatively easy. Len Sherman of Columbia Business School draws a parallel between Uber’s business and that of unregulated taxis in New York in the 1930s, when Ford’s Modelemerged as a new, low-cost cab.
The trouble is, as competition increases, ride-hailing becomes a commodity business. Customers care little whether they ride with Uber or Lyft, as long as it gets them from. That means neither firm can easily increase profits by raising fares, but may instead have to offer discounts. Likewise, the ride-hailing firms do not own their cars: their drivers do, and so have no reason to be loyal.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Uber CEO's advice for his 22-year-old self: 'Get the hell out of investment banking'Uber CEO's advice for his 22-year-old self: 'Get the hell out of investment banking.' via CNBCMakeIt
Read more »
Uber, Lyft IPOs May Lead to Higher FaresThe initial public offerings of Uber and rival Lyft stand to enrich early investors. But for customers of these ride-hailing services, the IPOs might eventually cost them money.
Read more »
How Do Uber And Lyft Compare In Terms Of Key Revenue And Valuation Metrics?Ride sharing behemoth Uber recent filed its S-1 as it looks to go public, following rival Lyft which listed in March. In this analysis, we compare Uber and Lyft’s key operating and financial metrics (for 2018).
Read more »
Via CEO Daniel Ramot on ridesharing industry and Uber, Lyft IPOsLyft and Uber's IPOs show that ridesharing is a 'very large market' with multiple solutions for passengers, says Via CEO Daniel Ramot.
Read more »
Lyft underwriters hail promising future as Uber loomsLyft Inc picked up upbeat ratings from the brokerage arms of its Wall Street und...
Read more »
Wall Street's valuation guru: From Uber to Pinterest, all the major IPOs this year are overpricedThis year's hot IPOs have one thing in common — they are all overpriced, according to NYU Stern professor Aswath Damodaran.
Read more »
Uber Chooses Citadel Securities to Handle Its IPOUber has chosen electronic-trading giant Citadel Securities to manage its hotly anticipated initial public offering on the New York Stock Exchange.
Read more »