Uber Overconfidence

Uber.jpg

As everyone knows, Uber is essentially–for now–a high-tech taxi company.


And high-tech tends to command high price.


But they are IMHO very overconfident of their position. 


And while I generally like taking Ubers, I would go so far to say that in many respects they are potential dead cab meat!


Why?


– Not because their leadership is in disarray and their founder and CEO was just forced to resign.


– Not because they have a disastrous corporate culture.


– Not because of their uber low or not profitable margins.


– Not because of the threat of autonomous driverless vehicles.


– Not because of the (alleged) stolen documents from Google.


– Not because Uber is (potentially) overvalued at nearly $70 billion (more than GM, Ford, or Honda)!


– Not because of its numerous competitors coming up from behind, including Lyft.


But a major reason is because:


They just gave you a not-so-hidden increase in price by tacking on a new tipping mechanism that will result in many people paying as much as a 20% hike to their overall fares.


Uber is now losing a sizable portion of their price point competitive advantage!


With the risks involved here, who could be so overconfident?

Perhaps, it’s time to take a cab or hovercraft somewhere else. 


(Source Photo: Andy Blumenthal)


(All represents my own opinions)

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