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LYFT and UBER - Back to when no one owned cars

UBER IPO is expected to be about 120B and today LYFT is valued at around 22-25B. With cars getting more reliable and cheaper to use as years go by and automation being developed, will we see more and more cities of people just using ride hailing services instead of owning a car? If so, are LYFT and UBER at a very good entry point today compared to 5-10 years down the line?

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id bet my money on the person developing the ai that will replcae drivers. the cost of a driver is literally 50% of a drive’s cost. uber and lyft’s take is 25%. the first person who can develop ai can literally undercut the typical fare by 50%. with discounts that big, itd be hard to compete as an uber or lyft. 

I love my cheese. I got to have my cheddar.

I’m thinking developing autonomous vehicles is all UBER and LYFT are thinking about right now. I see that as a benefit to these companies not a really a competitive challenge. Unless Google or Tesla jump in the ride hailing industry I don’t see any other company competing inside the U.S. in that space

maybe. google can easily license the profits away. or directly compete with them. to be fair there are lot of booking sites that are still alive. so perhaps uber and lyft can survive if google decides to share the pie!

I love my cheese. I got to have my cheddar.

Don’t count out the car markers themselves just yet getting in on this.  They’ve made plenty of stupid decisions over the decades but they’re aren’t blind.  It’s not hard to see declining auto sales and wondering why. 

Given the trials and tribulations of the millennials who can’t pay their student loans, it’s hard to see them find the money to buy cars, especially if they are devaluing car ownership in general.  That’s a large cohort to be writing off for car makers to ignore.

Cities like London, Hong Kong, NYC, etc.. will be first IMO to go this route based on simple cost/benefit analysis for the masses of car ownership vs car rental via the likes of Uber and Lyft.

Be interested in seeing if we have indeed hit “peak car” in the developed world and where it goes from here. 

Problem is these firms are extremely loss making right now with no clear plan to hit profitability.  Rates need to rise for the ride hailers, but they’re fully commoditized / substitutable and fighting over market share.  At some point they’ll have to engage in disciplined pricing, but it’s unclear how that will impact their prospects in the broader transportation market.

#FreeCVM #FreeTurd #2007-2017

Say self-driving cars become mass market viable. Currently Uber and Lyft do not own the vehicles and they are still not making money. Who would actually own the self-driving cars? What shape would the industry take? Maybe people just download some tech or have a subscription model to pay for self-driving software and Uber and Lyft still use third-party vehicles. Or, maybe a new player emerges that owns all the self-driving taxis and leases them to Uber and Lyft or cuts them out altogether. Self-driving cars are coming, but the shape the industry takes is far from certain.

From a tech perspective, it does seem like self-driving cars would be a winner-take-all type of industry.

you basically need to come from a target school pedigree/work at prestigious firm in the US/have a really good connection.

- AF hivemind

the value uber or a lyft bring is that they have the brand and loyal consumers already.

the profit is really in the self driving. you cut out the driver, and you are making bank at current rates. 

look at lyft’s s-1:

8.1b in total booking. but only 2.1b in total rev. 6b is going to the driver, we can prolly est. 2b going to wear and tear and gas.

so thats 4b that lyft can add to its gross profit if self drivign 

lyft is losing about 1 billion per year right now. so they can easily make a 3b net profit if they figure out self driving.

and then add the fact that rev is doubling every year, and its looking even rosier.

I love my cheese. I got to have my cheddar.

Nerdyblop wrote:

the value uber or a lyft bring is that they have the brand and loyal consumers already.

the profit is really in the self driving. you cut out the driver, and you are making bank at current rates. 

look at lyft’s s-1:

8.1b in total booking. but only 2.1b in total rev. 6b is going to the driver, we can prolly est. 2b going to wear and tear and gas.

so thats 4b that lyft can add to its gross profit if self drivign 

lyft is losing about 1 billion per year right now. so they can easily make a 3b net profit if they figure out self driving.

and then add the fact that rev is doubling every year, and its looking even rosier.

Brah, Lyft and Uber do not currently own the cars. Where do they get the cars in this self-driving scenario?

you basically need to come from a target school pedigree/work at prestigious firm in the US/have a really good connection.

- AF hivemind

there is no brand loyalty. ppl will go with the cheapest.

"You want a quote? Haven’t I written enough already???"

RIP

im actually on your side. just playing devils advocate. lol. maybe they’ll make a collab with the automakers and waymo. who really knows! 

waymo is trying to collab with the automakers. and they are selling their sensors to non competitors of their robo business. 

I love my cheese. I got to have my cheddar.

igor555 wrote:

there is no brand loyalty. ppl will go with the cheapest.

This.  They don’t even have driver loyalty.  You can’t make money, you don’t even have your employees, your customers have no loyalty and there are no barriers in any market.  It’s airline wars all over again until the market decides to price rationally.

#FreeCVM #FreeTurd #2007-2017

If the cars are self driving, couldn’t the manufacturers just install their own ride hail software (like Tesla has promoted)?

#FreeCVM #FreeTurd #2007-2017

Ride sharing is inherently more efficient than everyone owning a car themselves, and it is not moving 95% of the time. In suburban or rural areas, ride sharing has limited benefit, since space is abundant and vehicle density is low. However, in cities, these industries have a great future. It is worth paying some cost, even a huge cost, to capture market share before anyone else gets in.

I think Uber and Lyft have a great entrenched position actually. They are big enough to buy out and/or kill off any small startup competitors. Why do you think Facebook has not been usurped this whole time? 

The only credible threat to Uber is a company with huge user base already. For instance, an Apple or Amazon type of company would have to launch it’s own service and aggressively market that service to its own users. However, this would come with substantial financial risk, and it’s likely that partnering with existing companies will be the better solution. 

Can Uber’s price crash to something much lower? Sure, why not. However, it could also be worth 3x as much over time. Who knows. 

“Visit the Water Cooler forum on Analyst Forum. It is the best forum.”
- Everyone

oo tesla’s been lying. its not fully self driving (level 5 vs a level 2 at best right now and he predicts level 4 by this year). many people have complained about it.tesla may actually have to refund  that money. lol they;ve been collecting like 3k on a car for it. lol

https://cleantechnica.com/2019/02/20/elon-musk-full-self-driving-teslas-this-year-unequivocal-tesla-autopilot-improves-safety/

anyways the issue is really getting the drivers with the cars. teh customers will go wherever is cheapest. if you can rid of the drivers you have a huge comp adv. waymo has the best self automated driving data. their only issue is cars. if they can get the car. they can undercut uber and lyft and kill them imo. unless self driving automation becomes commoditized knowledge in which case uber and lyft will succeed.

automakers at large will get killed. you just dont need as much cars around if everything is ride sharing. 

in terms of who has the best self driving tech:

https://www.macrumors.com/2019/02/12/apple-self-driving-car-disengagements-report/

its waymo! followed by GM! tesla doesnt report ****, but claims to be the best, they just simulate it and they dont even report that.

I love my cheese. I got to have my cheddar.

i’m betting on waymo being a major standalone company in addition to licensing to uber and/or lyft. it could potentially JV with them to provide capital for a self-driving fleet as well. licensing at low cost to capture most of the market is GOOG’s mo.

waymo doesn’t want to become the only game in town due to antitrust issues with running tens of millions of vehicles. if it can offload some of the heat, it will gladly do so.

i think one thing we can all agree on is that apple will not be in the discussion here 

"You want a quote? Haven’t I written enough already???"

RIP

Apple is going to take the market. You think they did wonders for a phone? They are going to take cars to the next level 

wasnt it there car that ran someone over. also they just laid off a bunch of people. or reorganizeor wahtever.

also why would google give a **** about anti trust issues. they literally have search with some ridic market sahre at 90%. although they seem to be losing ground to fb and amazon in terms of digital ad dollars market sahre.

I love my cheese. I got to have my cheddar.

Apple is not going to make cars. The most they’d do is develop software to connect Apple users to ride share - i.e. what Uber is doing. Maybe those cars will be robotic, maybe not. Maybe Apple might develop some software for those robot cars. As far as an actual Apple car is concerned - they’ve already tried and decided not to go further. 

“Visit the Water Cooler forum on Analyst Forum. It is the best forum.”
- Everyone

LYFT is taking a beating just because of an UBER IPO. I would not be surprised if UBER tries to buy a stake in LYFT in the coming months

lol buy up your only competitor. i dont think that will fly.google actually owns a stake in both. about a bill in lyft and 5 bil in uber!

I love my cheese. I got to have my cheddar.

i agree that uber buying part of lyft would be silly as they are a direct competitor in many markets. what is the benefit of buying part of your only competitor when you are bigger, have more resources at your disposal and could just invest another $5-$20 billion in self-driving technology and win outright?

Ok, but they have invested in their overseas competitors although LYFT is much bigger. I think their last deal was a buy out of Careem for 3.1B last month (Middle East ride hailing company)

its only a monopoly if you buyout your competitor within your geography.

although maybe tehy could buy somewhat different competitors like byrd or something.

I love my cheese. I got to have my cheddar.

yeah weren’t the didi and careem buys basically them giving up competing in those areas and wanting exposure to or ownership of the leading operator? very different than buying part of a much smaller competitor.

I don’t think most people who drive today would ever give up the flexibility of owning your own vehicle, or the joy of driving (assuming traffic moves in your metro area).

We’re still miles away from autonomous vehicles being mainstream and safe, and then being accepted/trusted by the public. So far away that the discounted PV of any profitability would be much less than what’s being priced in.

Uber’s valuation is even problematic than LYFT’s because analysts are also pricing in other products like Ubereats like they’ve invented fire. They have a huge customer base until the moment a better alternative comes along, 

Uber’s IPO, in my opinion, will be like a lot of recent overhyped IPOs that went south (Fitbit, Snapchat, and now LYFT). I’ll probably have a small short position the moment Schwab will let me. That first ER when they announce how vague the path to profitability is will be a real wakeup call to these overpricing analysts.

I give the first autonomous ride shares about six months before they feel like inside of a subway and every service is sticky for questionable reasons.

#FreeCVM #FreeTurd #2007-2017

Nerdyblop wrote:

in terms of who has the best self driving tech:

https://www.macrumors.com/2019/02/12/apple-self-driving-car-disengagements-report/

its waymo! followed by GM! tesla doesnt report ****, but claims to be the best, they just simulate it and they dont even report that.

Hmmm GM owns 7.8% stake in Lyft

I may take a flyer on Lyft as upside is humongerous

Also:

Lyft has been working with Aptiv – a self-driving offshoot of car-parts supplier Delphi – in Las Vegas since January 2018. As of August 2018, 5,000 paid rides were completed in Aptiv’s fleet of 20 self-driving cars (75 Aptiv automated cars operate in the city in all), serving around 20 popular locations on the Las Vegas Strip. The companies plan to expand the fleet and the number of destinations.

Hey Hamilton, have a holly jolly Christmas.

rideshare disrupts public transportation far before it disrupts consumer car ownership. i’m already seeing this first hand.

small cities/towns are now testing rideshare in place of public transport (large capex doesn’t make sense for small locales and reasonable ongoing expenses are much easier to swallow than massive capex that is likely unsustainable). large cities are now incorporating rideshare with public transport systems and will likely cut inefficient bus routes and substitute with rideshare. i can now get anywhere i want in my city for a fraction of the cost to drive and only slightly more time ($3.50 to travel 36km by public transport in ~70 minutes versus ~$10 to travel 36km by car in 40-50 minutes) by linking to efficient transport (i.e. LRT) using city-sponsored rideshare.

price of cabs keeping going up WTF

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