I have finally finished my research and put all the effort into truly answering my inquiry question. Here is my final essay I have created to answer my inquiry question. I am hoping to answer future questions about my topic and hope to create no confusion.
What has made Uber, into a billion dollar company in the transportation industry? The ride share company, Uber, launched in 2009 and is operating in now in over 500 cities. It has made a huge impact on society because it has affected the way people travel. Uber has revolutionized transportation because its technology makes it incredibly easy for people to use and because it has made it very easy to become a driver for the company. In addition to impacting on the transportation industry, Uber, with its Ubereats division that delivers food, has impacted the restaurant industry.
Uber’s Ease of Use Has Impacted the Transportation Industry
First, how has Uber changed the transportation industry? Uber provides consumers an easier way to get from point A to point B. Uber has shown that transportation can include technology and can be as easy as clicking a button. This wasn’t always how people ordered a car. It used to be that people needed to “hail” cabs by standing on a street corner and putting their hand up indicating they wanted a yellow cab to stop. Or they would call a private car and order it for a specific time. Nowadays, with an Uber app, a car can be ordered by clicking on an app or online, but most people who use Uber use the app. Another thing that makes using the Uber app really easy is that once you setup your account and link a credit card, your ride will be charged to your account, so you don’t have to have cash or your credit card with you.
Another way Uber has changed the transportation industry is it has impacted the level of training needed to drive an Uber car. It takes a lot of work to become a regular cab driver. Typically you need the proper license to operate a yellow cab, for example, but becoming an Uber driver is not as much work. To become an Uber driver you need to fill out an application for the company to do a background check and you need to upload your driver’s license, car registration and insurance. This illustrates that Uber has made transportation much easier.
Uber’s Negative Impact on the Taxi Industries
Uber’s impact hasn’t been positive for everyone. Uber has affected the taxi industry in negative ways. It is almost impossible for the taxi industry to compete with Uber because of Uber’s low pricing and sophisticated technology. According to the Taxi & Limousine Commission, more people used Uber than taxis last year. In fact, many taxi drivers are struggling financially. Yellow taxi drivers have to buy something called a medallion which costs a different amount in different cities and it changes every year. According to the article, “Cities Made Millions Selling Taxi Medallions, Now Drivers Are Paying the Price,” the cost of medallions in New York City “fell from around $1.3 million to around $160,000. In Philadelphia they dropped from a high of $545,000 to $10,000.” So, if a person spent a lot of money on a medallion and then it dropped, it means the value of their investment dropped, too. In addition, with so many cars offering rides, taxi drivers are making less money per day because they have fewer customers. Less income means financial problems and that has had very serious consequences. According Forbes’s July 2018 article, “Dislocation And Its Discontents: Ride-Sharing Impact On The Taxi Industry,” taxi driver representatives “relate a doleful tale of bankruptcies, foreclosures, evictions and heart attacks, in a profession that was once a stepping stone to the middle class. At least five taxi and livery drivers in New York City alone are believed to have committed suicide over the past six months.”
UberEats and Its Impact on the Food Industry
UberEats, a division of Uber, has impacted on food industry , specifically restaurant businesses. UberEats is a separate app, and people can order food through restaurants that have partnered with Uber Eats and independent delivery people will deliver food to your door. Before UberEats was invented if people wanted to have food delivered they would need to order from a restaurant that offered that service.
Great idea? Not for everyone. Though it benefits the customers, it does not benefit restaurants because they need to pay UberEats a commission that is 30% of what the food bill comes to. So, if the food costs $100, UberEats gets $30. That’s a lot! In San Francisco restaurants have been closing ties with UberEats because partnering with UberEats had recently put some restaurants out of business.
Uber’s Major Competitors
Uber, which launched in 2009, was the first of a rapidly growing ride share industry. Ride-share companies that are Uber’s competitors include Lyft, Curb, Didi Chuxing, Grab, and Ola.
Lyft launched in the year of 2012 In the United States, Lyft operates in 220 cities and in other countries (Indonesia, Malaysia, Singapore, Thailand, Philippines and Vietnam). Lyft and Uber have the most competitive relationship because they are the most popular rideshare companies in the United States.
Curb was launched in 2014. Curb is a company with the concept of ensuring people with safety and professional driving. Curb also relies on a taxi license to work there.
Didi Chuxing launched in 2015, some people refer to Didi Chuxing as the Uber in China. Grab was founded in 2011, it is formerly known as Grab Taxi. Grab’s company operates in a lot of places (Southeast Asia, Malaysia, Singapore, Thailand, Vietnam and Philippines).
Ola launched in 2010, in Mumbai. It is rated at one of the fastest-growing companies in India.
The Future of Uber
Uber has definitely changed urban transportation but despite making billions of dollars, it is not a profitable company, yet. According to the Crunchbase 2018 article, “Understanding Why Uber Loses Money,” Uber’s “operating costs come to a total of $2.2 billion. And as Uber’s costs are $700 million greater than its available gross profit, it loses money.”
Uber has changed how people in cities travel and has had both positive and negative effects on society. Consumers of Uber and its UberEats division, as well as the people employed to drive the cars, have benefited the most. The taxi industry, particularly yellow cab drivers, have felt the most negative effects. Uber is still continuing to conquer the transportation world.