ADVICE FOR RIDESHARE DRIVERS: PART III

This is the final article in a three-part series on a ridesharing study I have conducted in Orange County, CA. This article entails a quick list including more of the business administration side of driving for rideshare companies, like Uber or Lyft, as well as the conclusion as to whether or not working as a rideshare driver is even worth the time, money, or energy altogether.

1. You will want to have a vehicle that gets the best fuel/energy mileage possible in order to make the most profits. It is highly possible to be a full-time driver and spend $50 per day, or more, in gas with an inefficient vehicle. With California gas taxes constantly on the rise, it makes it extremely difficult for rideshare drivers to make as much profit; especially if your vehicle does not get as good of mileage as you could be getting from a more fuel-efficient vehicle.
   
2. Some companies will lease a vehicle to you on a weekly or daily basis. This is good for someone who might not have a vehicle of their own, or maybe their vehicle does not meet the standard requirements the rideshare company has, or they do not want to put the wear and tear on their personal vehicle, etc. There are many reasons as to why someone might lease one of these vehicles through a 3^rd party company. However, I learned rather quickly the costs in time and/or out of pocket this can have on a rideshare driver.
   
3. Keep track of your mileage when you are ridesharing/working in order to keep it separate from your personal use.
   
4. Save all work-related receipts in paper and digital form. Receipts tend to fade quickly in your vehicle, so it is best to get a digital copy asap and to take the receipts out for better keeping inside your home.
   
5. Mind your health. When you drive for many hours, you are sitting and putting strains on certain muscles in your back, shoulders, neck, and arms. Make sure you have good posture, back support if you need it, and drive holding the wheel around the 4 o’clock and 7 o’clock to reduce shoulder stress. It is important to workout a little every day that you drive, whether it is before, during a split-shift, or after. It is important because it will strengthen your muscles to allow you to work more with fewer aches and pains. It will also boost your mood and quality of life. As an additional side note, don’t sit on your wallet, as it can cause back pains.
   
6. Protection from the sun is a part of taking care of your health. While driving for a rideshare service, you are exposed to the harmful UV rays when driving throughout the day time. This will cause tanning, especially of the left arm. It could also lead to concerns for your health, as severe as skin cancer. Be sure to wear 30 SPF sunscreen whenever driving, covering all exposed skin. It may be a good idea to reapply throughout the day, if you are working in daylight hours. Wearing a long-sleeved shirt will help. So, get sunscreen and a nice, and protective, pair of sunglasses.
   
7. Sitting in parking lots while waiting on potential riders is not the best method for success. There are those who believe it is opportunistic to go to John Wayne Airport, sit and wait for longer rides, as opposed to going on the hunt for the best opportunities. However, there are more factors involved than simply waiting in a queue. Not only are you competing with other drivers who already have more rides under their belt with priority rideshare assignment, but it is also not the most successful business technique to sit and wait. You will find, by far, more opportunities and make more money by driving around rather than waiting for airport rides. It is best to learn which areas are busy, which areas tend to have longer rides, and which areas you enjoy working the most.
   
   
   In game theory and behavioral ecology, the assumption of the success of the huntsman is based on a hunter in search of prey who does not wish to be found. However, with ridesharing and searching for the customers, the customers are equally actively seeking a driver. In a search party scenario, it is similar in that it is much easier to find the missing person when the person missing is also calling out to be found. Ridesharing consists of both parties searching for one another, and the market for this exchange is offered by the rideshare app companies, e.g. Uber or Lyft. Staying in one area limits the number of found connections. Keep searching. Trust the process.

Here is how it works financially and in regards to your time:

These rideshare companies in partnership with vehicle leasing companies will offer you a vehicle to lease that has roadside assistance, they handle the maintenance costs, extra car insurance, a replacement vehicle if necessary, on top of that the two major rideshare companies may even offer you financial rewards for completing a certain number of rides per week. They treat that amount as though it were to cover all of your vehicle costs, or at least as though it will be enough to where you could justify the expense.

If the vehicle offered is $215 per week (Yes, that is around the cost of these unlimited miles and use weekly lease programs in the OC and LA), you may need to drive an entire Friday or Saturday around 8 to 10 hours in order to cover that cost. Even with that much driving, you will still have to deduct your fuel costs and taxes that will have to be eventually paid. On average, it took around 12 hours, on a Friday or Saturday, to cover the fuel costs, vehicle lease costs, car insurance, and taxes. That is 12 hours out of your week just for the vehicle side of your entrepreneurial venture. Additionally, these rideshare car leasing companies tend to have a $200 returnable deposit that is due upfront along with first week’s payment. So, if the first week’s costs are not covered by that company, you are already down close to $415 before making a profit at all.

This is where the rideshare companies suggest, if you make 90 rides in a week they will give a certain amount, usually around $115; and, if you make 125 rides in a week, they will give you around $215. On average, in order to make 125 rides in the OC, it took around 50 hours, which including Friday and Saturday nights past 2 a.m. for optimum hours, working 6 or 7 days per week. On a good week, you may be able to get 125 rides in 40 hours, but that is rare. 90 rides can sometimes be achieved in 30 hours, but that is also rare in the OC. Both, Uber and Lyft, limit your working hours to 12 hours of work per day.

If your fuel costs average $50 for a full day of city driving, that is around $300 – $350 per week in gas alone. This is why it is important to get a vehicle with as good of gas mileage as possible. Even if you get a vehicle that allows you to cut that in half, you are still spending $150 – $175 per week in fuel costs for operation. Fuel costs in working hours can range from 10 – 18 hours of work in a 50-hour workweek depending on the car’s efficiency, and various other factors of course.

By the end of the week, late Sunday night, if you work 50 hours ridesharing in the OC, you may make around $1000 – $1300 before costs and taxes are deducted (i.e. gross). Please note that this amount already includes the bonus amount given by the rideshare company at 125 rides.


Once the costs are removed from this total for an average 50-hour workweek pre-tax with 125 rides and the given bonus, the rideshare driver’s take-home pay is closer to the following scenario estimates:

• $1000 (gross) – $215 (lease) – $350 (fuel) = $435 (pre-tax)
• $1000 – $215 – $300 = $485 (pre-tax)
• $1000 – $215 – $250 = $535 (pre-tax)
• $1000 – $215 – $200 = $585 (pre-tax)
• $1000 – $215 – $150 = $635 (pre-tax)
• $1300 (gross) – $215 (lease) – $350 (fuel) = $735 (pre-tax)
• $1300 – $215 – $300 = $785 (pre-tax)
• $1300 – $215 – $250 = $835 (pre-tax)
• $1300 – $215 – $200 = $885 (pre-tax)
• $1300 – $215 – $150 = $935 (pre-tax)

Best case scenario: 40-hour workweek, 125 rides, $1300 gross income, minus car lease and deducting the amount for average most optimal fuel costs = $935 (pre-tax).

The average weekly net income in the Orange County area, according to my study, was an average mean of closer to $350 per week (net), after expenses (i.e., including car lease, fuel, phone, insurance, and tax).

According to one study, the amount is shown to be closer to $40,000 annually. However, I wonder if that is just the amount reflected from the total deposit from Uber or Lyft to the driver, as opposed to the total net profit. Sure, if all of the vehicle expenses, fuel, phone, insurance, cost of leasing or owning a vehicle, taxes, etc., and cash tips, are not taken into account, the average income in my study reflects closer to $725 per week gross income.

This amount does not reflect tips given via cash, but it does reflect an amount that already includes the digital tips. On average, in the OC, you can be optimistic to make around $25 per week in tips. $100 cash tips have happened twice, and $20 has happened around 5 times within 6 months. Most tips are between $1 and $5.   

The average number of miles put on the vehicle was around 4000 miles per month working around 50 hours per week. Meaning around every two months you will have to conduct an oil change and routine maintenance, which is a cost in itself. With the rideshare-lease program, it at least covered that, although it did not cover your time taking it to get serviced (30-minutes to an hour, max).

Most of the vehicles offered by these lease companies are vehicles such as Hyundais, Kias, Nissans, Toyotas, and Fords, each around 30 mpg (+/- 5mpg) and I did not see any Prius or vehicle similar in fuel savings. Most of the vehicles were used by around 60,000 miles, meaning that they probably had some sort of warranty being covered on them from the respective manufacturers. Looking into used vehicles from years 2015-2018, and with those models, and within 60,000 miles, you could buy a vehicle for anywhere from $10,000 – $15,000 average in the OC.

Getting a vehicle loan, on the other hand, whether new or used, is next to impossible for the average rideshare driver because most banks are not open to such ventures as it is too great a risk for them. 

So, is ridesharing worth driving for?

Probably not as a long-term solution. However, if you are looking to make money quickly, or while in-between jobs, it may be a good temporary solution; especially if you already have access to a reliable and fuel-efficient vehicle to save on operation costs. Ridesharing is better for supplementing income as opposed to considering it as a career of choice. This may be more of an incentive to allow autonomous vehicles to better compete in the rideshare industry, as there would be fewer expenses and greater returns of investment. In the meantime, ridesharing is a convenient way to make a couple of dollars for drivers, and surely a better alternative to taxis and other means of public transportation in the OC today.