Is it really worth it driving for Uber and other ride-shares
You'd be surprised by how often Uber and ride-share drivers get that question from riders. In NYC, other major cities around the United States and indeed--around the world--rideshare giant Uber is introducing riders to a new and better way to ride. In its wake, it is disrupting the traditional taxi and car-for-hire models as we have known it. NYC also has other ride-share providers like Lyft, Juno, Gett and Via, all of which are doing the same. This big city shows the greatest evidence of the effect of this disruptive technology as more and more riders are abandoning yellow taxi cars and other neighborhood taxi bases in favor of Uber and its ride-share competitors. In conversations I’ve had with riders I find that they are happy to share their reasons for making the switch. Top of the list of things I hear are: clean and well maintained ride-share cars; safety of knowing ahead of time who the driver that will be picking them up; convenience of the ride-share app; and friendliness of ride-share drivers, relative to yellow cab and other traditional cab drivers.
In NYC, competition for drivers and riders by ride-share companies sure present opportunities for both drivers and investors in the ride-share business. Dispatched trips data aggregated by NYC Taxi & Limousine Commission --that license and regulate taxi and for hire car services in NYC -- show clear evidence that rideshares have taken a significant amount market share from yellow taxis over the last 5 years. The revenue potential of rideshares is so incredible that everyone appears to be getting in the game, the biggest recently reported being Google and Tesla. In San Francisco, Google has dipped its toe into the ride-share business according to reports and we suspect it is only a matter of time before they are competing here in NYC as well. Reports that came out of Tesla in October 2016 suggest that the innovative electric car company is likely going to be entering the ride-share business shortly as well.
A non-scientific random sampling of some ride-share drivers highlighted these broad categories of drivers for rideshares: fulltime drivers; part time while maintaining other employment; college students driving full/part time; small business owners looking for source of additional income while growing their businesses; and finally, drivers looking to grow into business owners of for hire car fleets.
If you do not currently have a source of income or employment options with a compensation range of $20 to $25 per hour, and you are looking for full time work in NYC. If you, in addition, value the degree of flexibility that driving for rideshares affords a driver, then driving ride-share with Uber, Lyft, Juno, Via or Gett might be worth considering. With Minimum Wage debates raging around the country to increase minimum wages to $10 - $15 per hour, one can argue that rideshares are definitely an option that presents an opportunity for low income earners in the minimum wage range to significantly increase their income.
Looking for part time work to supplement income from your regular employment? With stagnating income rates and rising cost of living these days, who isn’t? A significant number of ride-share drivers do it for additional income. I must mention though that some folks are discouraged by the demanding process of obtaining a TLC license in NYC, feeling that it is not worth all the effort unless you plan on driving fulltime. A TLC license is required in NYC to drive for rideshares. The fact though is, due to the flexibility that driving for rideshares allow, it is possible to work as many hours as you want, night or day, to make it worth your while.
I have met a number of business owners who have discovered the secret of rideshares as that funding option for their entrepreneurial dreams, at least until their small business is able to generate enough revenue to be self-sustaining. For those lucky enough to have savings; get their hands on seed money for their business; or to have been left a trust fund, that money would come in handy during the early years when most entrepreneurs struggle to get their entrepreneurial dreams off the ground. If Like my parents, yours 'forgot' to leave you a trust fund and you don’t have seed money or significant savings, then driving with rideshares might be that solution to your financing issues. How do some of them do it? They do ride-share driving in-between client appointments and during off-hours to make up their income.
Most students I have met who are ride-share drivers have reported satisfaction with driving ride-share versus other low wage employment options. The biggest selling point I hear from students is the flexibility of scheduling their work hours around whatever they have going on at school. A nursing student Uber driver told me about how he had to take a whole week to study for some exams on a subject he was seriously struggling with and how he then spent the next couple of weeks after the exam grinding to make up the lost income from the week he took off. He was thrilled by the fact that he could take the week off to study which paid off, as he passed the exam, and was sure that wouldn’t have been the case without the additional preparation time that the ride-share flexibility afforded him. I certainly wish the uber option existed when I went to college because I remember many days in class struggling to keep my eyes open because I had worked overnight and gone directly to class.
The final category of drivers I have encountered are those looking to grow from driving to business owners of car fleets. Fleet ownership appears to be viable when you consider that the weekly rental of a 2016 Toyota Camry for instance is anywhere between $400 and $500. Driving with rideshares presents drivers the opportunity to grow into owning a fleet of cars to rent to other drivers. Everyone seems to be getting in on the ride-share car rental action including individual drivers, car dealerships, taxi companies and car rental companies like Enterprise. This ownership of rental car business option also exists for investors looking to make decent returns on their investment but don’t necessarily want to drive.
Our experience have been that of pursuing a strategy to grow from driving our first ride-share car to growing our current fleet organically towards a target of a 21 car fleet by the end of 2017, which we expect would put our business valuation at $825,000 with expected ROI of close to 200%.
Hopefully this blog is helpful in providing you information in whatever category you might fall into in terms of your interest in partnering with the ride-share companies. We have provided our invite code below for those who have decided to drive but haven't signed up. Sign up with our codes for each ride-share and you will receive the published driver bonus from the ride-share company after you complete the number of rides the ride-share specifies. I firmly believe in not leaving money on the table, so would encourage you if you have not already signed up to be sure to take advantage of invite codes to receive the bonus from each ride-share company you intend to partner with.
If you fall into the category of those wanting to grow from driving for ride-share into ride-share business owner, or if you are looking to invest in rental ride-share cars without having to drive yourself, and have additional questions, send us a message to info@icarnic.com and we are happy to share our experience.
Be sure to take a few minutes to check out the rest of our site for valuable data and insights into the ride-share business. We also look forward to hearing from you with any feedback and questions you may have, email us at info@iCARnic.com. Also subscribe to receive all our blogs.
$300 Uber driver bonus:
when you use invite code CK348KPMUE to sign up to drive with Uber
$500 Lyft driver bonus:
when you use invite code OKECHUKWU397270 to sign up to drive with Lyft
Ride-share Info: all in one place
Our goal is to consolidate vital information about rideshares operating in NYC tri-state area onto one page to aid prospective and current drivers looking for quick answers to questions they may have about partnering with rideshares. We are continuing to update the page with additional information. Feel free to send us relevant information you may have that we have not listed and we will include it.
| Uber | Lyft | Juno | Gett | Via | |
|---|---|---|---|---|---|
| Website | uber.com | lyft.com | gojuno.com | gett.com | ridewithvia.com |
| Car models/ specs | Various, refer to their site | Various, refer to their site | Various, refer to their site | Various, refer to their site | Various, refer to their site |
| Current sign-on Bonus | About $300 but varies. Confirm on their site when you sign up. | About $500 but varies. Confirm on their site when you sign up. | Confirm on their site when you sign up. | Confirm on their site when you sign up. | Confirm on their site when you sign up. |
| Car requirement - minimum year | Researching | Researching | Researching | Researching | Researching |
| Driver License | NYS DMV Class E License & NYC TLC Driver License required | NYS DMV Class E License & NYC TLC Driver License required | NYS DMV Class E License & NYC TLC Driver License required | NYS DMV Class E License & NYC TLC Driver License required | NYS DMV Class E License & NYC TLC Driver License required |
| Vehicle License | NYC TLC License required | NYC TLC License required | NYC TLC License required | NYC TLC License required | NYC TLC License required |
| Insurance | For-Hire Insurance Certificate (FH-1)in driver's name on the specified car with minimum coverage of $100,000 per person; $300,000 per occurrence; $200,000 Personal Injury Protection (PIP) | For-Hire Insurance Certificate (FH-1)in driver's name on the specified car with minimum coverage of $100,000 per person; $300,000 per occurrence; $200,000 Personal Injury Protection (PIP) | For-Hire Insurance Certificate (FH-1)in driver's name on the specified car with minimum coverage of $100,000 per person; $300,000 per occurrence; $200,000 Personal Injury Protection (PIP) | For-Hire Insurance Certificate (FH-1)in driver's name on the specified car with minimum coverage of $100,000 per person; $300,000 per occurrence; $200,000 Personal Injury Protection (PIP) | For-Hire Insurance Certificate (FH-1)in driver's name on the specified car with minimum coverage of $100,000 per person; $300,000 per occurrence; $200,000 Personal Injury Protection (PIP) |
| Commission kept by ride-share company | 25% | 25% | 10% | 10% | Researching |
| Rider-ship (market-share) per NYC TLC records | Awaiting latest release of data by TLC | Awaiting latest release of data by TLC | Awaiting latest release of data by TLC | Awaiting latest release of data by TLC | Awaiting latest release of data by TLC |
| Office location | 633 W 27th St, New York, NY 10001 as well as offices in the 4 remaining NYC boroughs (Brooklyn, Queens, Bronx & Staten Island) | 31-00 47th Ave, Long Island City, NY 11101 | Somewhere in Queens. Visits to Juno office (Meet for Coffee) is by invite only. | 3718 Northern Blvd, Long Island City, NY | 226 5th Ave, New York, NY 10001 |
| Restricted Stock Unit (RSU) offered to drivers | NO | NO | YES | NO | NO |
Be sure to take a few minutes to check out the rest of our site for valuable data and insights into the ride-share business. We also look forward to hearing from you with any feedback and questions you may have, email us at info@iCARnic.com. Also subscribe to receive all our blogs.
$300 Uber driver bonus:
when you use invite code CK348KPMUE to sign up to drive with Uber
$500 Lyft driver bonus:
when you use invite code OKECHUKWU397270 to sign up to drive with Lyft
I can't afford to buy a car to drive for ride-share. Should I lease or rent?
In order to maximize your returns as a ride-share driver, it would be ideal to own your car. This is often not the reality for many prospective drivers. Given that most ride-share cars these days must be six years old or less, and the fact that you would want to get a car in decent enough condition to withstand the rigors of hours of driving means you are looking at shelling out a substantial amount to initially invest in your first car. There's also the fact that you need a car that can pass the very thorough NYC TLC car inspection, a step required before your car can be TLC licensed to operate. These considerations likely means that you would be expecting to budget an amount north of $10,000 to get a car for providing ride-share service. Reality is that not everyone has that amount of money sitting around.
So what are the options if you fall into this category? First let's start by eliminating traditional car financing as a reliable option. Most traditional car financing that allow individuals to finance the purchase of a car at reasonable financing terms ranging between 0% - 6%, are close to impossible to get when you are looking to purchase a car for ride-share purposes in NYC. The reason being, the car is the collateral, and the finance companies are counting on the value of the car to protect their investment in the event of a default in loan payments and the car needs to be repossessed. This is how the finance company ensures ultimately, that they do not lose money. Well, in the case of a for hire vehicle or taxi that averages about 1000 miles a week and depreciates at a faster rate than cars used for personal purposes, the value that the finance company is relying on to protect their investment burns away fast with each additional ride pick-up. So very rarely will you run into anyone lucky enough to have cars purchased through traditional financing sources with favorable terms being used to provide ride-share services in NYC. The most you will find are drivers who had to take commercial loans to purchase their car and the financing terms on those commercial loans are significantly higher than comparable personal loans and also require the driver to put down higher downpayments.
Once traditional finance sources are eliminated, the options that remain are (1) purchase through leasing companies (lease to own) and (2) rent a car from one of the many TLC car rental companies or individuals. Some of these leasing and rental companies work directly with rideshares and companies like Uber provide their information to potential drivers both through printed materials handed out at their offices as well as on their website.
For those who fall into the category of not being able to buy a car outright and are weighing the options between leasing and renting, we have collected some data and presented it below to aid your decision-making.
Under the rental option, insurance is covered and paid for by the rental company, not by the driver. This insurance is Commercial For Hire driver insurance and the rates depend on the driver's age, years driving, number of years driving TLC for hire as well as whether the driver has been in an accident in the last 3 years. This premium being paid by the rental company on behalf of the driver could be north of $100 weekly, which means that the net weekly rental costs paid by drivers is actually rental amount paid minus the insurance cost paid by the rental company. Termination of rental agreements are mosyly easy with a couple of weeks notice of termination and without penalty. Termination of lease to own agreement is likely going to be subject to hefty mileage overage charges
| Weekly payment | Maintenance included | Insurance included | Refundable deposit | Down payment | Terms | Milaege | Termination penalty | |
|---|---|---|---|---|---|---|---|---|
| Rental | $400-$450 | YES | YES | $0-$500 | N/A | Weekly | Unlimited | NO |
| Lease-to-own | $369-$400 | YES | NO | N/A | $500 | 3-4 years | Unlimited | YES |
The actual rental price drivers can expect to pay will depend on what car they choose and the rental company they rent from. The same holds true for the lease-to-own option. We therefore present the price in the chart below as a range. A Toyota Camry will obviously cost more to rent than a Hyundai Sonata of comparable years and mileage, for instance. The estimates we provide are taken from averaging the prices and terms quoted by rental and leasing companies; drivers should be sure to shop around for best deals. Our estimates are also for new 2016 vehicles, so you might be able to get lower rates if renting/leasing older pre-owned cars.
Be sure to take a few minutes to check out the rest of our site for valuable data and insights into the ride-share business. We also look forward to hearing from you with any feedback and questions you may have, email us at info@iCARnic.com. Also subscribe to receive all our blogs.
$300 Uber driver bonus:
when you use invite code CK348KPMUE to sign up to drive with Uber
$500 Lyft driver bonus:
when you use invite code OKECHUKWU397270 to sign up to drive with Lyft
Generating income/ wealth in the NYC ride-share economy
We are currently working on our latest blog that delves into further exposing opportunities that exist to grow your income and build wealth in today's ride-share economy.
Be sure to take a few minutes to check out the rest of our site for valuable data and insights into the ride-share business. We also look forward to hearing from you with any feedback and questions you may have, email us at info@iCARnic.com. Also subscribe to be notified when this blog is published.
$300 Uber driver bonus:
when you use invite code CK348KPMUE to sign up to drive with Uber
$500 Lyft driver bonus:
when you use invite code OKECHUKWU397270 to sign up to drive with Lyft
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