Contents:

    More news has come out about the Uber driverless car crash in Arizona. Today, senior RSG contributor John Ince covers a new, puzzling revelation, plus why on-demand delivery could be hurting, not helping, restaurants.

    The recent news about Uber’s driverless car in Arizona is almost unbelieveable: Uber disabled the standard collision-avoidance tech? Why? Today, senior RSG contributor John Ince covers this puzzling revelation, plus why on-demand delivery could be hurting, not helping, restaurants.

    Fetch App

    Uber Disabled Volvo SUV’s Safety System Before Fatality [Bloomberg]

    Sum and Substance: Uber Technologies Inc. disabled the standard collision-avoidance technology in the Volvo SUV that struck and killed a woman in Arizona last week, according to the auto-parts maker that supplied the vehicle’s radar and camera.

    “We don’t want people to be confused or think it was a failure of the technology that we supply for Volvo, because that’s not the case,” Zach Peterson, a spokesman for Aptiv Plc, said by phone. The Volvo XC90’s standard advanced driver-assistance system “has nothing to do” with the Uber test vehicle’s autonomous driving system, he said…

    Intel Corp.’s Mobileye, which makes chips and sensors used in collision-avoidance systems and is a supplier to Aptiv, said Monday that it tested its own software after the crash by playing a video of the Uber incident on a television monitor. Mobileye said it was able to detect Herzberg one second before impact in its internal tests, despite the poor second-hand quality of the video relative to a direct connection to cameras equipped to the car…

    In November, Uber agreed to buy 24,000 Volvo sport utility vehicles onto which it planned to install its own sensors and software to permit pilot-less driving.

    My Take:  If this is true, it’s shocking. None of this looks good for Uber. This was supposed to be a “new improved” Uber after TK’s ouster.  In the aftermath of the accident, Bloomberg goes so far as to suggest that Uber has become isolated in their quest for driverless technology, because no one else wants be associated with them.

    One expert calls this a ‘critical moment of truth’ for autonomous industry. Here’s a telling quote from that Bloomberg article, “The video released by the police seems to demonstrate that even the most basic building block of an autonomous vehicle system, the ability to detect and classify objects, is a challenging task,” Mobileye Chief Executive Officer Amnon Shashua wrote on Intel’s website. “It is this same technology that is required, before tackling even tougher challenges, as a foundational element of fully autonomous vehicles of the future.

    This kind of thing wasn’t supposed to happen any more with the new improved Uber. Why would Uber intentionally disable the safety system? Why would they put themselves in legal jeopardy?  What do you think? Is this a new Uber – or the same old bad boys of tech?

    Why Uber Eats and GrubHub partnerships are risky for restaurants [CNN/Money]

    Sum and Substance: Today, you can get just about any kind of food delivered to your door. That’s great news when you’re hungry. But delivery can be a risky bet for restaurants. To reach customers, gain exposure and build a new channel for sales, restaurants that can’t deliver food on their own are signing up with third-parties like GrubHub (GRUB), Seamless, Uber Eats, Postmates and DoorDash….

    McDonald’s (MCD) partners with Uber Eats. Dunkin’ (DNKN) uses DoorDash. Pizza Hut, KFC and Taco Bell parent Yum Brands (YUM) took an ownership stake in GrubHub last month. Chipotle (CMG), Red Robin (RRGB), Jack in the Box (JACK), Cheesecake Factory (CAKE) and Outback Steakhouse (BLMN) also rely on apps.

    But these relationships are in their testing stages and can carry unexpected risks, including shrinking profit margins and shifting customer allegiances. “It’s difficult for a restaurant to just flip on the switch,” Stephen Dutton, an analyst at Euromonitor International, said. “Navigating the best way to get involved in delivery is a big challenge.”

    Turning a profit in the food business is tough. Partnering with delivery aggregators squeeze margins even tighter.

    Restaurants pay the services 15% to 30% fees for each order customers place through their platform. “It is a very large expense for the restaurant chain to absorb,” said Jeffrey Bernstein, an analyst at Barclays.

    Customers are also less likely to ask for menu items that carry higher margins — including soda and alcoholic drinks– when they order in, cutting deeper into profit from delivery….

    If a restaurant decides third-party delivery is the best way to boost sales, analysts say they can take steps to build a happy marriage. Restaurants need to negotiate low fees with aggregators to prevent delivery orders from eating into margins and reach data sharing agreements to gain customer insights.

    My Take: This article give substance to a gut feeling I’ve had all along about these delivery services, especially UberEATS. I’ve yet to see any breakdown of the numbers, but I’m suspecting that Uber has been sustaining losses in an effort to build market share in a very competitive marketplace – much like their strategy in ridesharing.

    I’m wondering if any of our readers have insight on this. Remember, the numbers have to work for four parties – the restaurant, the delivery company, the driver and the consumer. For this to be a good deal for the restaurant, it must be satisfied that the delivery service is augmenting and not diminishing the goodwill involved, especially when it comes to ratings.

    Uber to pay $10 million to settle discrimination case [The Hill]

    Sum and Substance: Uber will pay $10 million to settle a class-action lawsuit brought on by 420 female and minority engineers who accused the company of discrimination and creating a hostile workplace. As a part of the settlement, Uber has agreed to change its compensation and promotion practices for women and minority employees at the company. If approved, the plaintiffs’ lawyers at Outten & Golden would monitor the reforms for three years after they take effect…

    Other changes the company agreed to in the settlement include requiring Uber to publish a diversity report twice a year, having its executives discuss the status of its internal diversity and steps it’s taking to improve it during a semi-annual business review and requiring all new hires to complete diversity and inclusion training….

    The settlement comes one year after former Uber employee Susan Fowler revealed pervasive sexual harassment and a culture of mistreatment of women at the ride-hailing company….

    My Take:  Uber seems to be in settlement mode. The $10 million they’ll pay to get this case to go away seems like money well spent. Heck, they probably would have spent close to $10 million to pay their lawyers for their defense had this gone to trial.

    In any event, the less combative approach taken by the new regime at Uber seems to be working. But let’s be honest, Uber still has a lot more work to do.

    Uber’s Upfront Pricing Can be Way Off, But You May Get Around It [The Points Guy]

    Sum and Substance: We’ve known for a while now that Uber has been charging riders based on what it thinks they will pay, not a fare based on distance and time. Uber confirmed that it had been overcharging riders with its “upfront pricing,” which uses machine learning to estimate how much customers are willing to pay for a ride.

    A report from The Rideshare Guy explains more how this practice is being used on frequent riders, and also shares a few techniques on how to avoid it.

    The report explains that Uber calculates its rates in the San Diego market based on miles traveled and time in the car. The author was making frequent UberX trips, on the same days of the week, between the airport and his home for business travel. After what used to be a $55 to $60 ride, the prices jumped from $70 to $80. There appeared to be no surge pricing in effect.

    Editor’s Note: Great write up on our article about Uber potentially overcharging frequent riders, which RSG contributor Will Preston wrote about last week. Will’s article was also picked up by Hacker News and Slate.

    Announcement: The winner of our “Best Setup” competition from earlier this week is Yusbel Ramos from Miami. She get’s a year of QuickBooks Self-Employed!

    Check out her ride:

    Here’s what she is working withRotating Red/Blue/Green Lasers starlights on the roof, LED disco party ball rotating in multiple colors with the music, illuminated pink water drinks in the cup holders, dashcam displaying  speedometer, internal night vision recording the cabin, Bluetooth so passengers can stream their own music, plenty of charging cables for android and iPhone,  phone mount on center dash for easy navigation, micro blue led sign scrolling “Treats For Tips”, air purifier releasing clean ions, Miami is a non stop party town on the weekends where I work and people really appreciate the party theme and non-stop music hits that continues all night long!!! – Yusbel


    Earn $25-$45 Per Hour With Instacart!


    Instacart is hiring like crazy right now and offering many perks and benefits to drivers. 

    Why become an Instacart Shopper?
    - Get paid to shop
    - Work whenever you want
    - Get paid FAST

    Click here to sign up and start ASAP.

    Get started as a gig worker today! Learn more:
    - Is driving for Doordash worth it?
    - Postmates Driver Pay
    - Instacart Shopper Pay
    - Uber Eats Driver Review
    - Best food delivery service to work for
    - Rideshare insurance



    -John @ RSGReaders, what do you think of this week’s round up? Do you have any insight on restaurants’ profit margins using UberEATS, GrubHub, etc?

    John Ince

    John Ince

    John Ince is a former Fortune reporter and Wall Street banker. He has about 1,000 rides under his belt driving part time for Uber and Lyft.  He’s writing a book about his experiences entitled:  Travels With Vanessa:  A Rideshare Driver Tries To Make Sense of It all - For a sneak peak visit the link above.