More Than You Ever Wanted To Know About Uber Tips

In response to my last post about driving for Uber, my coincidentally-named friend Bob asked in the Comments section about tips. Tips? Heh. Let me explain...

Uber is both ingenious and diabolical. They started a taxi service (let's be honest) and convinced the general public that it could be provided more cheaply than conventional taxis. And the public readily accepted this premise, because who doesn't like "cheaper?" Uber also implied (if not coming right out and saying) that tips were "included" in the fare and that passengers didn't have to even bother with them. Uber wanted the experience to be smooth: Call a cab on your phone; get in, get out; and have it paid by your credit card on file, have a nice day. Easy-peasy for the Me-Generation.

The public, while decrying taxis as "smelly, expensive, undependable rattletraps" at the same time must have believed that all taxi drivers were getting rich on those exorbitant, usurious fares. Or maybe the taxi owners were getting rich. *Somebody* had to be getting rich for people to believe that a taxi service like Uber could be run such a discount and still make money. (Hint: It can't.)

No taxi driver is getting rich.

And of course not even Uber is getting rich. Nearly every day we hear stories on the news of how Uber is losing billions of dollars each quarter. But somehow the public believes that it's a viable money-making venture. Odd, that. The logic escapes me.

So let's get back to what a driver makes. Out of those refreshingly lower fares that passengers love, Uber takes 30% in various fees. What does that leave for the driver? Not bloody much, thank you. In fact, when you compare apples to apples (and I do), driving for Uber is just about the same, expense-wise as driving a taxi. ...Except you're driving (and wearing out) your own personal vehicle.

No Uber driver is getting rich.

Here in Pensacola the city-regulated meter rate for conventional, licensed taxis is $2.25 per mile. Uber's base rate is $1.13 per mile (plus they tack-on some extra fees). On short trips, Uber might even be more expensive than a taxi. On longer trips, Uber has the advantage.

And remember, Uber's initial, introductory rates were as low as $0.75 per mile in many cities, including here in my town. That has steadily (and quietly!) increased over time. It's the old drug-pusher's philosophy: Get them hooked first and then you can do whatever you want. Uber, being unregulated, can raise rates as it pleases. So now Uber's fare advantage is not as great as it was in the beginning. But people like the service and so on the Scale Of Importance! the overall rate drops down a notch. Or...customers just haven't noticed that using Uber is more expensive than it was in the beginning.

Uber drivers were making so little money that they pressured the company into providing a tip option. Uber resisted for a long time but finally relented. But it certainly was not due to public demand. Currently, some people do tip; some don't. And it's weird. Unlike my taxi passengers, some Uber tips are totally out of proportion to the ride.

Just today I picked up a man at a local seafood restaurant. His home was well north of town, and we had a lot of time to talk on the way. He had a lot of questions. People are always interested in what other things Uber drivers do...or did before “doing Uber.” Though I'm reluctant to say it, I gave him my spiel about how I've been a helicopter pilot for a long, long time and that I'm semi-retired now, and Uber is a way of keeping me out of the house and meeting cool, interesting people.  (Which is true.)  This sparked many wide-ranging questions from my rider as well as some oddly astute observations about aviation. He obviously knew more than he was telling.

The fare to his house was only $15.00. When we got there, as usual I said that I enjoyed talking with him, and wished him good luck in his career, of which he'd told me plenty as well. Later on, I saw that he'd added a $15.00 tip to his bill. Nice! (I've noticed this before – some people have tipped me more than the actual fare for the trip. That never happened in my taxi.)

I've noticed that if you treat people with respect, engage them in real conversation – not the fake, “How do you like this weather?” kind, and don't “talk down” to them, their tips are usually bigger.

I've also noticed that while I didn't get that many tips in the beginning back in May, more and more customers are tipping now. I'm not sure whether this is a cultural thing, as people are becoming more and more aware that they should tip, or whether it's my sparkling personality generating them. I suspect it's the former. I think we're still in the “honeymoon” phase of Uber.

On the other hand, I am learning how driving for Uber is different from driving a cab, and maybe I'm getting better at this “job.” (I'll deal with those differences in a future blogpost.)

At the end of the day, between thirty and forty percent of my riders tip. I've done 217 trips so far and have received 74 tips. (To be honest I've gotten a few cash tips but they are very, very rare.) My tips are running slightly over 30%, which is higher than when I drove a taxi, where the tips consistently hovered around 20%.

I'm always grateful to get tips. But I'm ecstatic when riders give me a five-star rating, which is important.  I'll explain why in a future blogpost as well.

Uber: Work when you want!

A lot of people ask me how long I've been “doing Uber?” I explain that I drove a taxi in Pensacola for the last eight years, and then a couple of months ago switched over to Uber. Invariably, one of the next questions is how I like making my own schedule...working when I want? And I laugh. Uber seems to have convinced people that they invented this, “Work when you want” stuff.

They didn't.

I don't know of many cabdrivers in this or any other city who are required to work certain hours. Yes, when I drove a cab for a big company in New York City I had to choose a particular 12-hour shift, mainly because there was another driver who'd be driving “opposite” me. But even there, owner-operators can make their own schedule. Uber's, ”Be your own boss! Work when you want!” come-on is simply laughable. Pretty much any cabdriver can do that. The difference is that with Uber you're using your own personal vehicle as a taxi instead of a car that's set-up, metered and branded for that specific purpose.

But the reality is that for taxi drivers here in Pensacola, “work when you want” means working weekends because that's when the Navy and Marine guys and gals can get off base. There is “some” airport business (but it's dying as customers switch over to ride-share). There is virtually zero hailing of a taxi at the curb, not even downtown on weekend nights anymore. Almost all taxi trips are radio-dispatched. Finally there is “some” street business (e.g. home-to-Walmart), mostly handled by Yellow and recent upstart Lucky Cab. Even these trips are radio-dispatched.

And here we must speak delicately. You must have a credit card to use these “ride-share” services. (Although apparently Lyft allows customers to use pre-paid credit cards.) But there will always be a segment of society who either does not have a credit card, or who doesn't want to share that information with some big company. There are people who, for whatever reason simply want (or need) to pay cash for their taxi ride. Thus, Yellow and Lucky Cab still thrive. And probably always will.

Such trips are usually in the...well...let's say “less-affluent” parts of town. At the cab company with which I was most recently associated, when a trip would come over the radio with a pickup in a known...ahem...bad area, nobody would bid on it. At night, if a driver picked up a fare and indicated (by code) that the destination was “sketchy,” another driver (or two – whoever was free and in the area) would quickly rendezvous with the original car at the destination, or prior if possible.

The joke is that in the ghetto, taxis are called, “rolling ATM's.” People know we have money for the taking. So guess who wouldn't take any trips originating in the ghetto? Right, me. Call me racist...whatever. I may have mentioned before that not long ago a Yellow Cab driver I know was robbed at gunpoint and stuffed in the trunk of her car. The female accomplice kept telling her boyfriend, “Shoot her! Shoot her!” But the boyfriend did not, thank God. (They were both caught, thanks to the dashcam Yellow installed in all their cabs.)

Okay, I kind of got off on a tangent there. The point is that driving for Uber is a wonderful change from driving a taxi. There are pluses and minuses, like everything. For me, for now, the advantages outweigh the negatives.

I worried that my revenue-per-mile would be drastically worse with Uber, but so far that has not proven to be the case. I'm making about the same amount of money I was making driving a “regular” taxi, but I work less hours to do that. The best thing about working for Uber is that I can be sitting in my house, writing crap on the internet with the Uber app on (like now), and I can get a trip without having to drive a single mile.

I wish I could've done that in my taxi.

Home, Sweet...Hell? (It only feels that way)

Well they said it couldn't be done...said it wouldn't be done! But done, it is. I went up to Washington on June 5^th, and now I'm home safe and sound(?) in Pensacola here on July 15^th. My deal with the Boss was that I'd come up and cover one of the ships that we have a on 30-day contract. Up, cover the job, and then be gone. It wasn't what I wanted, but not for nuthin' the farm manager of the customer for whom I've been working for the last seven years called and put a little pressure on me too. And so I went back.  It's nice to be wanted.

The thirty days went by surprisingly quickly.  As my departure date from Washington approached, my friend Terry remarked that I had not experienced a Florida summer in quite a while, and I might be in for a rude re-acquaintance since it's been so hot and humid this year in the Sunshine State. This is true; the last summer that I was in Florida was 2010.

And sure enough, it's plenty hot here in Pensacola today. The mid-90 degree heat is exacerbated by the 73% humidity, which makes the air feel not just hot but heavy as well. You go outside and the air just weighs down on you. But that's life along the gulf coast – I'm not complaining.  (Up in Washington today, with similar temperatures the humidity is 13%.  Quite the difference!)

Anyway, it's good to be home. Now, all I have to do is get the exhaust system on the motorcycle, get it registered (which I should have done before I left – oops!) and try to get some riding in between rainstorms.

It's going to be a great rest of the summer!