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Uber Face Fines Over Drunk Driving Complaints -- And Lost $2.8 Billion Last Year (usnews.com)
While Uber's bookings doubled last year, the company still showed a net lost of $2.8 billion. And now, "California regulators are recommending that Uber pay a $1.13 million fine for not investigating rider complaints that drivers were working intoxicated." An anonymous reader writes:
California "requires ride-hailing companies to have a zero-tolerance policy for driving under the influence of alcohol or drugs," notes Reuters -- and yet Tuesday's order reports that investigators "found no evidence that (Uber) followed up in any way with zero-tolerance complaints several hours or even one full day after passengers filed such complaints." Investigators from the state's Public Utilities Commission are asking the full commission to examine their findings,
"To confirm the policy, regulators analyzed selected complaints against drivers who received three or more complaints," Reuters reports. Though Uber has sometimes suspended drivers within one hour of customer complaints -- 22 times -- they've apparently received 2,047 drug- or alcohol-related complaints between August 2014 and August of 2015. "The company said drivers were banned from working in 574 of those complaints, according to the order. But regulators then reviewed 154 complaints, and determined that the company failed to promptly suspend drivers in 149 complaints. The company also failed to investigate 133 complaints, and did not suspend a driver or investigate 113 complaints, the order shows... In at least 25 instances, Uber failed to suspend or investigate a driver after three or more complaints, the order states."
An Uber spokeswoman said the company had no comment, but "Adding to Uber's challenges, a Reuters investigation found a ten-fold increase in attacks on drivers in Sao Paulo last year, including several murders, after the start of cash payments on its platform at the end of July." And in addition, a judge in Brazil ruled last week that Uber's drivers are employees, which could make Uber liable for a variety of benefits, following a similar ruling in another Brazilian state court.
But there's also some good news for Uber. A court in Rome suspended a ban on Uber in Italy until the company finishes its legal appeal, and a two-month suspension in Taiwan also came to an end after Uber agreed to partner with license rental car companies.
"To confirm the policy, regulators analyzed selected complaints against drivers who received three or more complaints," Reuters reports. Though Uber has sometimes suspended drivers within one hour of customer complaints -- 22 times -- they've apparently received 2,047 drug- or alcohol-related complaints between August 2014 and August of 2015. "The company said drivers were banned from working in 574 of those complaints, according to the order. But regulators then reviewed 154 complaints, and determined that the company failed to promptly suspend drivers in 149 complaints. The company also failed to investigate 133 complaints, and did not suspend a driver or investigate 113 complaints, the order shows... In at least 25 instances, Uber failed to suspend or investigate a driver after three or more complaints, the order states."
An Uber spokeswoman said the company had no comment, but "Adding to Uber's challenges, a Reuters investigation found a ten-fold increase in attacks on drivers in Sao Paulo last year, including several murders, after the start of cash payments on its platform at the end of July." And in addition, a judge in Brazil ruled last week that Uber's drivers are employees, which could make Uber liable for a variety of benefits, following a similar ruling in another Brazilian state court.
But there's also some good news for Uber. A court in Rome suspended a ban on Uber in Italy until the company finishes its legal appeal, and a two-month suspension in Taiwan also came to an end after Uber agreed to partner with license rental car companies.
If Uber pulls off what they're trying to do
What they're trying to do is what all corporations run by psychopaths is trying to do: Be the perfect cancer.
And they should be treated as such.
I was wondering the same thing.
Theoretically they are operating in the black at the lowest level - the cost of a ride is less than the company pays their drivers.
App development and hosting is in the millions, not billions.
So that leaves advertising and legal fees, right? $2.8 Billion Dollars.... in legal fees and advertising. Wow. Just.... Wow.
So if each high-profile case runs around $10 million in legal fees.... that's, what? .... a couple hundred cases? Hmm... Ok. Worldwide.... I suppose that is plausible.
But with that they'd still have to be operating at only break-even on the rest of their operations. How is that possible? They don't have any employees to speak of. They only get a cut of orders for other people. They claim to have netted $6.5 billion on bookings of $20 billion. And still they lost almost $3 billion.
That is simply a stunning number. How can their costs possibly be $10 billion per year - above what drivers make? That's just a colossal amount of money for a middle-man. .........So I google.... and find that there are some leaked financial documents running around. Apparently they are paying drivers in places like China 50% more than they are charging the customer, as a "driver incentive". So they lost a billion a year in the china market, because driver incentives were 154% of revenues.
Well... that would explain it then. Next question.... why exactly are they paying drivers more than they charge the customer?
Any sane society would shut Uber down for what it is; a ponzi scheme that abuses and asset-strips labor.
The regulators and drivers will shut them down well before anyone gets fully reliable self-driving automobiles on the market.
This is Enron all over again.
It's not complicated. Zero tolerance just means any infraction. You're trying to be clever by conflating tolerance with blood alcohol level or somesuch. One tolerance would be that one conviction is allowed. It's not complicated.
Also, coffee isn't a drug for the purposes of the law in so far as driving is concerned. Honestly, I don't know what you think you're illuminating here. We probably agree Uber is money pit. But none of the other stuff you said makes any sense.
"Old man yells at systemd"
All things considered, $2.8B USD isn't a whole lot.
Are you trying to be cool by association, dropping big numbers like that, or are you just terrible at math? $2.8 is a whole lot of money.
If Uber continues to succeed, they will be among giants such as Delta Air Lines and Greyhound but in a more local realm.
Uber has lost more money in 2016 than the entire revenue of Greyhound. Two more years of such losses and Uber will have lost more money than the entire fleet, equipments and offices of Delta are worth.
These guys are WAY more efficient than the public sector transit solutions and are more efficient than the government-sponsored Taxi Cartels. Uber only needs to not be shut down to grow and succeed.
No they're not. The bulk of the $2.8 loss is money paid to the drivers by Uber. Their business model is not sustainable unless they figure out a way to make self-driving cars work. Knowing the current state of technology, it's unlikely to happen before investors pull the plug.
lucm, indeed.
Oh please. If taxis could ever have been "the defacto transportation system for the entire world", it would've happened decades ago. Having a phone app is an improvement, but not THAT much of an improvement.
And plenty of companies "try" to conquer the world. That doesn't give them the right or ability to handwave away a $3 billion dollar loss based upon their CEO's future dreamworld where they earn $25 trillion a second.
self driving cars are. Millennials won't be able to afford cars. Their wages are dropping and there's no sign of that trend stopping. Once that hits critical mass (e.g. enough of them of voting age who can't buy cars but aren't completely crushed by poverty) they'll be demand for public transportation. That's where Uber is positioning itself. The investors are letting them bleed money because, well, 2.8 billion only sounds like a lot of money to you and me. It's not chump change to the investors, but it's not going to really put them out. We've let wealth inequity get pretty crazy and we don't punish folks at that level for mistakes; so it's not really a risk to them. Maybe it woulda been in the 60s and 70s but not today.
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isn't a lot of money given what's at stake. If Uber pulls off what they're trying to do they'll become the defacto transportation system for basically the entire modern world.
Uber is losing money on every single ride. That's where the $2.8B went last year: paying drivers. If that money-losing model become a "defacto" transportation system for the entire modern world, it will mean that the bulk of the GDP will be spent on paying drivers to move people around. This is so fucking absurd I really don't get how educated people can even consider that as a serious possibility. The numbers just don't add up.
There's only 2 way Uber can turn a profit:
1) increase their prices to a point where cabs are a lot cheaper
2) use self-driving cars that are cheap to build and operate, and find someone to subsidize production on a massive scale
If they were anywhere near a breakthrough with their self-driving cars, things would be different. But they're not. They've used the worst possible strategy for their business: acquire shitloads of customers long before they can be monetized. They started on that path at a time when it was all the rage in Silicon Valley (case in point: Twitter). But that's not going to work. Tesla, Amazon and Google are all in a much better position to take over this market if it ever becomes cost-effective because they will have the technology to make it happen. Uber only has an app that a handful of RoR retarded programmers could recreate in a week.
lucm, indeed.
They're certainly more efficient at losing money than taxi companies.