Comment by Symmetry
2 days ago
Because of how many miles taxis drive their depreciation as a physical asset that wears out costs more than the interest on the money invested in them. To the extent that driving aggressively generates more wear or introduces more accidents it will likely end up costing more money.
Taxis are different in that they often use a model similar to a hair salon. The driver is renting the car. There is no incentive to take care of it… it’s a prisoners dilemma situation.
With the Uber, the driver is responsible for the car, and the smart drivers get it that wear and tear is bad. Of course, many uber drivers are idiots who don’t math well, and are basically burning equity at a loss.