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Comment by jfoutz | Hacker News Reader

in that brochure, average total cost per mile is $0.5646 @15k miles per year. I think you're looking at the operating cost per mile, that doesn't include stuff like insurance, registration, and financing. page 9, look in the middle of the green section for the cost per mile - page 8 has the row name you're looking for.

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My point is the fixed costs (the ones you list) don't significantly change if you already have a car and decide to become an Uber driver. Mr Mustache didn't pay 18 dollars to drive those 36 miles, he was already going to pay for his insurance and registration.

It's odd that insurance is a fixed cost. The probability of an accident seems like it would increase with more time spent on the road. I assume that either Uber is covering the difference in insurance, or there's a bit of moral hazard at play.

Both Uber and Lyft cover additional liability insurance as long as the app is open. They also cover comprehensive if a passenger is in the car.

https://www.nerdwallet.com/blog/insurance/best-ridesharing-i...

My insurance company asks me approx how many miles I drive per year and also how far away I live from work (because I list commuting as the purpose of my car). I assume those variables are included in my premium and my (very low) premium would be higher if I drove more or lived far away from from work - my commute is only 4 miles.

I also assume the Uber driver would have to tick off "business" as their car's purpose and your insurance may go up just because of that check mark, no matter if the mileage was higher or not.

Right, insurance does care how much you drive, but there are costs to being fine-grained about how you measure it, so they usually lump in everyone below ~30k miles/year and don't bother to count the differences there. I remember entering 10k vs 15k miles per year and the quote was the same for Geico.

Of course, you're absolutely right, and insurers have been slow to account for this parameter; the startup MetroMile exists solely because regular insurers overestimated what a difference the mileage makes. (MetroMile charges by how much you actually drive.)

It depends on the policy. Mine is pretty much a fixed rate. But many policies do have mileage bands.

Exactly. Insurance rates change with greater mileage and also with using a car for business instead of personal use.

If there is an accident, an Uber driver will need to pay out of pocket, unless they lie and tell the insurance company the ride wasn't for Uber.

To a point. If you are conscientious, then more time on the road makes you a better driver, by knowing your car better and being better able to predict what others will do.

I mean, it's your source. You're free to disagree with it. the cost per mile clearly goes down as milage goes up. as witnessed by the 10/15/20 brackets of driving. but 20 cents a mile isn't even close.

Insurance isn't a fixed cost, they want a yearly mileage estimate.

Most of the costs are not fixed, i.e. wear and tear, gas etc..

A car is literally one giant consumable, good for approx 200k miles. Of which perhaps 100-120k are pretty reliable, and after which reliability steadily degrades.

The argument is that those costs don't matter so much if you're going to be owning the car anyway. But cost accounting is complicated. The reality is that, for a car used a minority of the time for taxi service, the number is somewhere in between the IRS cost/mile and the bare minimum fuel + standard maintenance. For one thing, the car will get into higher maintenance costs and will need to be replaced sooner than if you just used it for yourself.

I would expect that an Uber driver would be doing far more than 15k miles per year. That's just normal usage.

You're also mixing up your accounting. The parent was discussing marginal costs, and you're discussing average costs. The marginal cost is what's used for making economic decisions, like deciding to drive for Uber or not.

From op's data,

    10,000 - $0.7354 
    15,000 - $0.5646
    20,000 - $0.4944

I just don't see how you get that marginal cost down to $0.20, yes mile n+1 is a little bit cheaper than mile n. and sure, let's pretend that high milage cars used cars sell for the same as low milage cars. so financing is fixed. I just don't see how you can get regular maintenance and gas and insurance down to 20c/mile.

You're looking at average cost, which includes half-ton pickups and large SUVs. Look at page 6, which contains small and medium sedans.

Ah, i see. I misunderstood your argument. I thought you meant something like "an average person want to pick up some uber shifts. they already have the car, so the expense can't be that much." I'd assumed an average person would have an average car, and thus average cpm.

you mean (i think) someone needs a car for whatever reason. They specifically select a car they can use with uber, maximum mpg, least maintenance, and used. That might work. i'm still (very) skeptical of the $0.20/mi cost. But i could see you might be able to get that quoted $0.37 down to $0.32 or if you're really lucky, $0.30

A full time Uber driver is likely to do about 75,000 miles in a year.

My wife does 3-4 days a week for prime now. On track to hitting 12k miles this year. Just as a data point

The average driver between 20-50 drives around 15,000 a year.

https://www.fhwa.dot.gov/ohim/onh00/bar8.htm

The average driver implicitly isn't using ride sharing so there's really no relationship between that stat and this discussion other than it'll be closer to your number than to the average daily miles of a glactic starship captain.

A better number would be a taxi driver.

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