Is any company really ‘recession resistant’ as Uber claims they are? And what’s going on with Lyft’s autonomous vehicle program? Buckle up for this week’s roundup with senior RSG contributor Paula Gibbins.
Uber’s CEO Says Company Is ‘Recession Resistant,’ Sees No Job Cuts (Bloomberg)
Summary: Uber Technologies Inc. Chief Executive Officer Dara Khosrowshahi said the company is “recession resistant” and doesn’t see a need for job cuts, even as market volatility and the prospect of a global recession loom over technology companies.
“The signal on the street is things are really strong and the spend on services continues to be quite robust,” Khosrowshahi said during an interview Wednesday at the Bloomberg Technology Summit.
The optimistic tone comes after Khosrowshahi told staff in May that the ride-hailing giant would “treat hiring as a privilege and be deliberate about when and where we add headcount.” Rival Lyft Inc. also said it plans to significantly slow hiring and cut costs….
My Take: I mean, it’s great they don’t feel the need to lay people off right now, but if we are on the verge of a recession, the true impact hasn’t hit yet and it’s impossible to predict how badly it will affect any business. Saying your company is “recession resistant” is arrogant and he may be eating his words sooner rather than later.
Here’s what some of RSG’s readers posted to Facebook concerning this news:
“They’ve already cut what they can cut they can’t cut anymore. Still can’t make a profit despite price gouging customers and not paying drivers,” said Robert W.
Ron G. said, “If your driver’s aren’t making money then you have know clue as to what you’re doing. You should find another job.”
Others mention how much money Uber is wasting by providing 1.5 million insurance coverage without really covering their drivers.
Basically, drivers have seen nothing but pay cuts in recent years and there’s nothing Uber can do to cut down those costs unless they change their insurance coverage policies.
Lyft plans to build a hybrid network of autonomous and driver vehicles, co-founder says (CNBC)
Summary: Lyft’s vehicle fleet will remain largely commandeered by drivers even as the company continues to develop its autonomous driving capabilities, co-founder and president John Zimmer told CNBC’s Jim Cramer on Tuesday.
“What we see happening is that there will be a hybrid network, meaning on day 1, just like what happened with phones, you didn’t have 3G go to 4G go to 5G on separate networks. You still needed to be able to make a 3G call when 4G wasn’t available,” Zimmer said in an interview on “Mad Money.”
“The same thing’s going to be true with autonomous vehicles. … It’ll do five percent of the trips. 95% of the time you’re going to rely on a rideshare driver. So that’s all going to happen within the Lyft network, and we’ll scale up with our autonomous partners,” he added.
Lyft Autonomous’ AV partners include Ford Motor and Argo AI, Motional and Waymo. Lyft announced in 2021 that it will launch a driverless robotaxi service in Las Vegas next year through its partnership with Motional….
My Take: Can we file this under the “duh” category? I don’t think anyone expected a fully autonomous fleet to take over for active drivers at the flip of a switch. The only thing that makes sense is a phased in approach.
But something that is continually overlooked in these discussions is the general public’s concept of getting into a driverless vehicle. With how finicky technology can be, what would happen when (not if) something went wrong with the programming? Our phones freeze up for no reason sometimes, so what would happen if the vehicle glitches?
As RSG Facebook commenter Chez said, “It will probably take 20 years before the majority of people will use an autonomous rideshare.”
Chris said, “They’re gonna find out real quick that it’s a lot more expensive than they think. Currently they’re passing all the expenses onto the driver. But as soon as they have to pay for and maintain those vehicles that are well over $100,000 each, they’ll be in for a rude awakening.”
And probably my favorite response was from Gary, “In the year 2525.” If you’re not familiar with the song, check it out.
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Also in the News…
Seattle-area demand for Uber, Lyft still not back up to speed, an outlier in the U.S. (Seattle Times)
Thoughts: See driver reactions to this article on the RSG Facebook page.
Waymo is teaming up with Uber on autonomous trucking because time really heals all wounds (The Verge)
Thoughts: It only makes sense that big powerhouse companies with similar end goals would team up instead of fighting each other. They’ll be a tough rival for Lyft to contend with.
Is Uber recession resistant? Are we headed toward a recession? Sound off in the comments!
-Paula @ RSG
