San Francisco-based Uber Technologies Inc. (UBER) took the transportation industry by storm when it released its groundbreaking ride-sharing app in 2009. Uber is available for Google Android, Apple iOS, and as a web app. The app connects riders with nearby screened drivers who provide rides in their private vehicles. Passengers pay competitive prices for the service, which is cheaper than taxis in many places.

On a cold and snowy evening, StumbleUpon founder Garrett Camp and his business partner Travis Kalanick had trouble finding a taxi. That experience inspired them to start the ride-sharing company. Uber celebrated 10 billion rides with much fanfare in July 2018. Uber's highly anticipated initial public offering (IPO) finally took place in May 2019. Although the stock's price initially tumbled, Uber was still worth over 45 billion dollars as of November 2019.

Statista estimated that about 110 million people actively used Uber each month in 2019. There are enough enthusiasts that industry observers are wondering why so many people choose Uber.

KEY TAKEAWAYS

  • Uber customers typically get where they are going faster or cheaper than they would by taxis.
  • Uber now requires all prospective drivers to submit to motor vehicle and criminal background checks.
  • Partygoers can rely on being able to find available Uber drivers through their apps late at night.
  • The combination of Uber and expanding online grocery delivery is making it more practical to live without a car.

Fast Trips Any Time, Almost Anywhere

Many believe that the failure of taxi companies to get customers to their destinations quickly enough is what allows Uber to thrive. The taxi companies often blame their drivers for being unable to pick up and transport passengers in a timely manner. The taxi drivers respond by complaining about the low fares customers pay for short-distance trips, creating a cycle of inefficiency for taxi companies.

While wait times vary, Uber customers typically spend far less time waiting than customers of traditional taxi services. Riders also have the option to share rides with others heading in the same direction through UberPool, the app’s ride-sharing feature. As a result, Uber customers typically get where they are going faster or cheaper than they would by taxis.

Public transportation doesn't run around the clock, and not all taxi companies run 24 hours a day. People who work or party late at night often use Uber to get home quickly when bus and metro train lines are shut down.

Safety

Riders choose Uber over other transportation methods for safety reasons. The company experienced serious incidents in the past, such as drivers attacking passengers. Uber now requires all prospective drivers to submit to motor vehicle and criminal background checks. The company runs background checks that date back seven years. The checks include a search of multistate criminal databases, motor vehicle records, and a review of the National Sex Offenders Database.

Post-Party Rides

It may be difficult to persuade taxi drivers to pick up riders who have had too much to drink in obscure parts of town late at night. There are around 4 million Uber drivers in over 400 cities worldwide. Partygoers can rely on being able to find available Uber drivers through their apps in the wee hours of the night. Picking up intoxicated passengers is not without its challenges. Rowdy passengers even attacked drivers on some occasions. Uber drivers in India were the first to get access to a panic button on the Uber app to contact the police for this type of emergency. Uber drivers operating in the U.S. gained access to the panic button in 2018.

Avoid the Cost of Owning a Personal Vehicle

The true cost of owning a car is higher than most people think. Consumers paid about $9,576 to own and operate their vehicles in 2017. Urban dwellers who do not need cars can also save money by using Uber. These savings apply mostly to riders who don’t need cars daily but sometimes need a ride for weekend outings and other special occasions. The combination of Uber and expanding online grocery delivery is making it more practical to live without a car.