Uber paid 58 Australians $1350 to have One Less Car | Hacker News Reader

Uber paid 58 Australians $1350 to have One Less Car

forbes.com.au

26 pointsraybb40 comments

> Participants estimated they spent around $4,500 a year on their car. When prompted to include maintenance and insurance, they upped their estimate to $5,900. Whereas Uber says industry data estimates the average annual cost of owning a car in Australia is more like $16,000 to $19,000.

I am in New Zealand. Our car fleet is old (median car is something like 15 years old, but don’t quote me on that).

There is no chance the average New Zealander is spending even close to Uber’ estimate. Australians, I am told Australians have nicer cars than NZ but I really doubt Uber knows more about what the average Australian spends than they do.

There are two ways to add up the average spending on cars: ask individuals to estimate their aggregate expenses, or add industries together (dealerships, repair shops, petrol stations, insurance agencies, etc) and divide by population.

I suspect Uber statisticians did the latter. I also suspect that method is more accurate than people entrenched in car culture estimating their own expenses.

If they've done any research at all they almost certainly do know more.

I also live in NZ, did you read the CBA report on our feebate scheme a while back?

It concluded the policy had a net economic benefit due to correcting consumer's failing to take into account the cost of fuel in making ICE/hybrid/PEV purchasing decisions.

> t I really doubt Uber knows more about what the average Australian spends than they do.

A big part of the difference could be that Uber is including in its number the depreciation in the value of the vehicle, which most people don’t consider when asked what the cost of ownership in a given year is. Most people answer with insurance + fuel + maintenance and ignore non-cash costs.

Here in Canada my 2017 vehicle has cost me $6023 CAD (maintenance, cost of ownership, insurance) per year on average. Maintenance includes a suspension repair, new tires, brakes, oil, other small things. I’ve included small items purchased for the car.

If I included fuel it would be a much scarier number.

Based on its apparent condition and ongoing expenses, I don’t expect this number to increase much. I have a feeling Uber’s numbers are wrong, or they’re including fuel costs.

You explicitly need to include the cost of fuel. So what is the scarier number?

There is a distinction between ownership and usage. By simple fact of owning a car, I have some $1-2k annual fixed costs (insurance + registration + minor maintenance). Gas scales with the utilization, which is lifestyle dependent.

But if you’re comparing to switching to a different mode, you have to include the cost of gas.

That’s what this article is about?

I think the math on car ownership is more complicated than $X to own vs $Y to rent on demand. Being able to take an impromptu trip without any coordination is worth significant quality of life.

It typically takes 5-10 minutes for an Uber to arrive at my door. Not to mention the few times where the driver has cancelled the ride, and left me waiting for a new one to be assigned. Especially troublesome when you are relying upon this service to make a hard deadline at the airport.

Great. There are ways around that, ultimately you can work that into the model as a discount.

Pretending that fuel isn’t part of the equation doesn’t help though.

This seems tough to factor in at the individual level, since usage costs will vary dramatically. I suppose the same applies with rental, but ownership costs won’t very as much. They are difficult models to compare both for cost and practical use reasons. They seem fungible, but in many ways they aren’t.

It looks like with fuel considered, my yearly cost rises to about $12k.

To get a number that high, they're likely also including parking costs too, as well as fuel. If a garage adds $100,000 to the value of a house, that's over $500 a month in increased mortgage costs. And if you have to pay to park at work, too...

I immediately get suspicious when I see a population average instead of a median. Is the luxury car market in Australia blowing up the average?

Amusingly, in America, I purchased my used Honda for less than $16k.

There's a lot of $70-120,000 cars on the road. Lots of Lexus, BMW, Mercedes, Tesla, Porsche SUVs. Then there's the giant American-style SUVs which are $80k+. Once you factor in depreciation of those over something reasonable like 8 years, you get what Uber are describing pretty quickly.

(I drive a 2009 Hyundai while I wait for a reasonably-priced EV to become available.)

An economist would probably say "just increase car registration fees", and that would be the most efficient way to get people to own fewer cars.

I have a car that I got as a gift. I put about 150 miles on it per month. But I still have to pay $425 per month to park it, about $110 per month for insurance, $350 per year to register it, and then gas, tolls, maintenance.

I knew it wasn't a good economic decision to keep the car. It would certainly save me money just to take Ubers to the few places I go. But there's a psychological element at play here. Right now, I pay about $600 per month to have the car and have unlimited access to go where I want. If I have to pay $80+ to go to a friend's place, I then have to ask myself "is that trip really worth $80"? I may then just decide no. That's what economists want, but that's not really what I want. I don't want to have that excuse to not go out and have fun.

If the equation were more like "do I want to draw down on my $1350 in Uber credits that I lose at the end of the year anyway", my whole internal calculus changes.

Have you considered just budgeting yourself $600/month on guilt-free non-essential transportation, and committing to spending any remainder on nice refreshments/gifts for your friends?

Yes, I deal with this same issue owning a car. It’s choosing between buffet and a la carte pricing. When it comes down to socializing, you do not want to be thinking twice about choosing to mobilize to visit friends/family for cost reasons, and ridehailing pricing does that.

> So he and his wife left the Australian-made station wagon in the garage for the month, during which they only drove their eight-year-old electric BMW twice. “Just on her urgent things. Other than that, we didn't drive at all.”

But that's half the point of car ownership, in the event of an emergency, you have an escape plan and won't have to rely on others for transport.

It is an expensive contingency though. And public transport, taxis, non-uber rides etc. do exist. As do electric bikes. As does the option to move somewhere where not having a car is less of an issue. Or pooling a spare car between a few people.

Except for relying on others to have left your car alone, and to have left the roads accessible, and relying on gas or ev charging stations to be up and running.

That's just not true. They'll just be stuck in bumper to bumper traffic. Wanna know how I know? Because that's exactly what happened in the opening days of the Russian invasion of Ukraine. Luckily, Ukraine has a well functioning train system and the majority of refugees escape by train to Poland.

Not really, evacuations by car are very common in most suburban areas. You are thinking in city-centric terms. Most of the US and Australia are not 5 minute cities with subway stations located a stone throw away from your house.

That's because the US and Australia are run by brain dead individuals (and the voters who enable them) who let the train system they had crumble into disrepair. Even the famously corrupt Ukrainian government did a much better job at multi-modal transport option. The Ukraine refugee situation is the best example of how refugees should be evacuated in the event of a catastrophe. if they did it all by car, it would've been absolute chaos and lead to many more causalities.

Sources: https://www.cnn.com/interactive/2023/05/world/ukraine-railwa...

https://www.nytimes.com/2022/11/15/magazine/ukraine-trains.h...

> While the number of cars continues to rise, we’re driving them less: 2.5m cars drive less than 5,000km. “We wanted to find out who are these 2.5 million people who own these cars that don’t make sense. We found that most of them are in two-person households. Not really a surprise. This is the second car. The primary car gets a lot of use. The second car is used maybe on the weekend to take one kid to sport … People are spending thousands and thousands of dollars just for these one-off occasions.

Not surprisingly, Uber is focusing on a problem that affects them ("why are people buying a second car instead of using Uber"), but doesn't really affect society very much. Eliminating these rarely-used cars wouldn't really reduce traffic or pollution, it would just save some individuals some money, which is great, and redirect some of their money from gas and repairs and such to Uber.

> but doesn't really affect society very much.

In addition to the items you mention, there is an embodied carbon / pollution component to manufacturing these barely used second vehicles.

That's fair. Although it's partially (mostly?) offset by the preferred solution here of using Uber, which produces tons of extra CO2 from cars idling/driving around waiting for a fare and driving without a passenger to pick you up.

I'm not saying getting rid of these second vehicles is bad, it's great, but Uber's specific focus on rarely-used vehicles only makes sense because they want to make money. Any independent observer concerned about CO2 or pollution or traffic or road safety would want to incentivize getting rid of cars in general, and put more effort towards frequently-used cars.

Taking kids to weekend sport in Australia is not a one-off occasion. It's every Saturday morning. It produces its own peak hour (approx 10am-1pm Sat), focused in certain suburban areas, that's often worse than weekday peak hour in the city centre. It's also really hard to do it without a car. The sport locations can be quite unpredictable (sometimes in your local neighbourhood, sometimes a 2+ hour drive away). They're seldom accessible by public transport. And (in Sydney at least) children under 7 need to be in a car seat in an Uber (but not required in a taxi!), and no Ubers with car seats are available. So it's not only much easier, but also probably fairly cost effective in the long term, to have a second car with 95% of its use being for weekend kids sport.

Right, but having to use your second car for that trip and only that trip is probably a rare occasion for many families. I imagine the most common cases are two cars that are both used regularly because both parents drive to work, or one primary car that can be used both during the week and for that Saturday morning trip, and the second only for the rare occasion that the primary car is broken or being used for something else.

My point is not that nobody needs a second car, my point is that focusing on rarely-used cars is by definition not a major societal issue. What you're describing is a very real issue, and might be more appropriately addressed by improving public transit. Uber's idea of replacing your second car with ridesharing does not work, as you say.

Edit: Also note "most of them are in two-person households." So it seems they're mostly focused on couples without kids.

this is a stunt, but Uber is lobbying with policy recommendations, that're more interesting than the stunt:

> Uber’s recommendations to “unlock the Big Move”

> Price access to city-centre roads to encourage behaviour change through parking charges, road tolling, congestion charges and clean-air zones.

> Unabashedly focus all government policy areas on securing the future well-being of people over a very long time scale. “In practical terms, the current system will prioritise spending on a road upgrade yielding a 2-minute travel-time improvement compared to a rail project that will future-proof a new community with a sustainable, car-free travel option.”

> Reform health and net-zero policies to encourage more active lives and reduce emissions through devising and promoting travel behaviour change initiatives delivered in partnership with industry, communities and the third sector.

I would be happy to see more focus on walkable neighborhoods, more public transport & less reliance on private car ownership in Australian cities. Less sprawling new-build suburbs with no infrastructure nearby & long commutes for economic opportunity, more zoning flexibility & mixed residential/commercial stuff, more high density, less land devoted to roads & parking. I'm not a fan of Uber, interesting to see there's a bit of overlap in what they're lobbying for (to grow their market share) & what I think might benefit the country.

I don't think they are actually lobbying in support of these things beyond including them in press releases. When things like congestion charges are actually proposed they lobby against them: https://nyc.streetsblog.org/2022/09/01/uber-puts-its-thumb-o....

Any society with 2+ car households is a failure. All its residences will just be subjected to endless traffic and the smog/co2 emissions that it'll generate. Your second vehicle should be an e-bike, which you can take to a tram/train for long distance rides.

> James Russell was surprisingly keen to jump on board an experiment designed to persuade people to own fewer cars – especially for someone who has had up to four vehicles parked at his Melbourne home.

So we're starting with someone that has four cars and we're asking them to not drive a car that's likely already used? Okay, sure, but that weakens the premise quite a bit.

> So when he saw Uber’s ad offering to pay people $1,350 - in cash, public transport credit and Uber credits - to leave their car at home for a month, he jumped at it.

For a month. Huh.

I'm all for improving walkability and mass transit options, which is why this stunt is fairly disappointing. This smells like an Uber PR piece that's trying to paint Uber as part of a sustainable future. A much more compelling story would be a narrative about subsidized transportation for people that lack alternatives rather than asking someone leave their _fourth_ vehicle parked.

That’s only one participant of 58 in the study.

> The 58 participants had a week of being studied with their normal car usage to establish a baseline, before going four weeks driving one less car. Two-car households went down to one, one-car households went down to no cars, and there were six participants who never owned a car in the first place but who were there to compare behaviours with the newly carless.

Also, while he “has had” up to four cars in the past, it sounds like they currently only use two:

> So he and his wife left the Australian-made station wagon in the garage for the month, during which they only drove their eight-year-old electric BMW twice.

>One hundred and thirty days looking for parking.

No one spends 8.5 hours a day looking for parking. This person is out of touch.

I reckon that estimate must be over an 80 year lifespan.

> (130 / (80 * 365)) * 7*24

Translating it to per week, that comes out at 45 minutes per week.

Yes it's a lifetime estimate, from here: https://www.parkhound.com.au/blog/australian-drivers-spend-o.... Extremely misleading quote from the Uber person, probably intentionally.

Also basically a made-up number, a website that helps people find parking asked 300 people "how long do you feel like you spend looking for parking on average".

> a website that helps people find parking

indeed, that's a very biased sample. i've been happily living in a big australian city for over a decade without owning a car or using uber. i spend approximately 0 hours looking for parking per decade. they're never going to find me in the population of parking-seekers that they're surveying.

I remember those days in pre-school where it was a nightmare to find parking.

I wonder how does that compare to waiting for taxi. If you add up time from ordering taxi service to getting in. And then waiting to get dropped off when vehicle has arrived.

Parking Georg, who spends every waking hour of his life looking for parking, is an outlier and should not have been counted.

but, yes, it's a different timescale. They aren't saying the average person spends that much per day.

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