For our latest post we welcome guest contributor John Sollars to share his perspective on UberPool. John also runs the blog RideshareDriver.com and we’ll be sure to include upcoming features by him on the SherpaShare Blog.
I’m a full-time driver and a veteran in the driving industry, and recently ran some of the numbers: It turns out that a driver’s compensation for UberPool rides is nearly identical as it is for UberX rides, and can often lead to higher earnings for the driver.
On the surface it might appear that the driver has to work harder for exactly the same amount of money when accepting an UberPool vs. UberX ride. Drivers earn the same mileage rate, the same rate per minute and the same base fare (for the 1st passenger) as they do for an UberX ride.
The key difference though is that UberPool rides often last longer and can therefore be a more efficient use of your time. Here’s how it looks:
The Math Behind UberPool Efficiency
Recently, in San Francisco, I completed a three passenger UberPool ride which paid $19.94. After the 20% commission and safe rides fee deduction I made $12.71.
Here’s how the UberPool fare broke down:
- Base Ride Fee = $2.50
- Safe Ride Fee ($1.35) x 3 passengers = $4.05
- Mileage Earnings (4.9 mi x $1.30/mi) = $6.37
- Time Earnings (27 min x $0.26/min) = $7.02
While $12.71 for 27 minutes of work is not exactly Uber CEO Travis type money, at $28.44 per hour it is slightly higher than my usual $25 per hour average.
I looked back at my dashboard for a similar 27 minute time frame during which I completed two uberX rides and found that for the same amount of time I only made $8.38.
Here’s how the 2 UberX fares broke down:
- First ride net (10 minutes) = $4.68
- Second ride net (8 minutes) = $3.70
- “Dead” time (9 minutes) = $0
The empty 9 minutes in between rides represents the time spent waiting for the next ride, traveling to the 2nd passenger, and time spent waiting for the passenger to come out of their house.
Those two UberX rides together netted me $8.38 vs. the $12.71 I earned for the UberPool ride taking exactly the same amount of time.
“It doesn’t take a rocket scientist to realize why UberPool in this case was more efficient. The meter was spinning from the time I picked up the first passenger until I dropped off the last.”
Focusing on Efficient Miles
In the early 1970’s, Southwest Airlines revolutionized the airline industry by introducing the “10 minute turn.” Their goal was to get their planes back into the air within 10 minutes of reaching the gate. Southwest figured out the same truth that applies to rideshare driving today.
The only time drivers (or airlines) are making money is when they are actually carrying passengers.
A plane sitting at the gate or an UberX driver sitting in his empty car outside of a passenger’s house are both examples of the same fundamental rule. When you’re idle or empty, you are not making money. As drivers, we are paid per mile and per minute. The goal should be to log as many miles as you possibly can, with the least amount of those miles unpaid or empty.
As a former Yellow cab driver in SF, I can tell you that spinning the meter at $2.75 per mile was always lucrative. Even short trips were profitable because the customary cash tips bridged the gap. Those economics are long gone. Uber and Lyft have forced the excesses out of the industry and are seemingly in a fare race to the bottom.
Today, short rideshare rides are like poison because the tips are gone, the mileage rate is so low and the time it takes to arrive, pick up and drop off passengers make them very unprofitable.
The Usual Response to Lowering Rates
Rideshare technology has consistently changed the game. The mileage rate drivers earn has dropped to $1.30 in San Francisco and below $0.90 in some other cities around the US. It’s a tough task to make a good day’s wage at those rates. As a driver, I want to keep the meter spinning, minimize empty miles and find longer trips whenever possible.
While I don’t think $1.30 per mile is good, I am able to earn a decent day’s wage in the market I drive in when I have large volume. UberPool increases my volume and more importantly, negates the effect of empty minutes between rides.
The Efficiency of UberPool
When drivers answer an UberPool request, just as with UberX, the sooner we arrive and pick up a passenger the sooner the meter starts. UberPool rides differ in that drivers have multiple passenger pickups and drop-offs, however the meter starts from the time a driver picks up the first passenger and runs until they drop off the final one.
UberPool rides are usually not short rides that pay $3.20. They are seldom under $15 and often above $25.
Savvy drivers who can manage up to 3 or 4 pickups and drop off destinations can do nothing but profit from these rides. Uber is happy because they earn a better margin while paying drivers the same basic rate per mile. Riders are happy because they individually pay about 80% of the normal fare. Drivers are happy because a 3 passenger ride ends up being a long ride while staying within the target market.
The Downsides of UberPool
There are some negative factors that drivers perceive with UberPool. Managing multiple pickups and drop-offs can be confusing to some drivers. More rides would be available if passengers all used UberX instead. Passengers are also sometimes upset when new passengers appear in their Uber as they didn’t realize they requested an UberPool ride.
UberPool vs UberX: What should I focus on?
Concentrate on your efficiency as a driver. Learn to call or text these passengers as part of your methodology in getting them out of the house and into your vehicle.
UberPool passengers tend to come outside quicker for two reasons: First is the two minute “wait rule” of UberPool versus 5 minutes for UberX. The second is that riders want to avoid harsh feelings (read: peer pressure) from fellow passengers and not keeping them waiting. They don’t have those same pressures when it’s just the driver.
I know many drivers don’t like UberPool. One driver used the term “perpetual ride.” To these drivers, I say, “Please–please give me a perpetual ride. Let my meter spin.” Uber is correct in stating that we do make more from these rides.
I can’t tell you how often I have picked up two passengers from a similar location, dropped one off halfway across town and the second all the way across town. UberPool rides are seldom short trips. The market has trended to include these types of rides and the savvy driver should understand how to adapt to this.
If you want to opt-out of UberPool, you’re out of luck. Currently, drivers can not opt out of UberPool. It is a feature of the service in some markets. If you wish to drive for Uber, you will need to do these rides. So the lesson is: Learn to adapt and embrace UberPool.