Originally Posted by kcowan
The value that Uber delivers is because of their low overhead. Often their drivers are retired and driving their own cars for some extra money. Compare that to a taxi company that must buy the car and the taxi license and then hire drivers for 3 shifts. Their downtime is very expensive. Uber drivers just go home.
Very good observation. This is one of those 'disruptive technologies' they talk about.
Yes, cars (and many other things) are very underutilized capital. The drive-when-I-chose-to Uber driver has mostly just the variable costs, his fixed costs are fairly constant regardless (yes, wear and tear on car, etc).
It's one of the things that makes it so hard for me to spend money on a car - I want some great features, but then the car sits unused for ~ 23 hours a day. Drives me nuts (no pun intended)!