How Uber plans to put its own drivers out of business

By Abha Bhattarai

Volvo and Uber have joined forces to develop autonomous driving cars.
Volvo and Uber have joined forces to develop autonomous driving cars.

Uber spent years amassing an army of 1 million drivers around the world. Now its CEO says it wants to "wean" customers off of those very drivers.

Beginning this month, the ride-sharing company will begin deploying self-driving cars -- equipped with cameras, lasers and GPS systems -- to pick up passengers in downtown Pittsburgh, Bloomberg Businessweek reports. The custom Volvo SUVs will offer free introductory rides and, at least for now, be supervised by engineers in the driver's seat.

The idea, the company says, is to eventually replace human drivers with automated systems. The fleet of 100 new vehicles, will come with tablets in the back seats to tell customers what's happening and to discourage them from interacting with their drivers.

"The goal is to wean us off of having drivers in the car, so we don't want the public talking to our safety drivers," Travis Krikorian, Uber's co-founder and chief executive, told Businessweek.

That could be a problem for the company's drivers, many of whom use the ride-sharing service to make ends meet.

Since its founding in San Francisco seven years ago, Uber has given rise to a new opportunity for independent contractors.

But in recent months, the ride-sharing company has slashed fares and begun taking a larger portion of revenue from its drivers, amounting to less take-home pay for those behind the wheel.

Uber last year said its drivers make about $19 an hour -- but by the time taxes, insurance costs, gas and car maintenance are factored in, that figure is whittled down to about $10.50 per hour, according to a Washington Post analysis.

But could Uber's driverless fleet also be bad for car companies?

The company's CEO says yes, according to Businessweek:

We see it as an opportunity.

In the long run, Kalanick says, prices will fall so low that the per-mile cost of travel, even for long trips in rural areas, will be cheaper in a driverless Uber than in a private car. "That could be seen as a threat," says Volvo Cars CEO Hakan Samuelsson. "We see it as an opportunity."

- Washington Post

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