The money you’ll make driving for Uber and Lyft depends on the time and energy you put in, but there’s also smart and creative tips to maximize your profits. First, it’s important to know the fare structures for these platforms, and how the expenses of ridesharing impact your pay.
The skinny behind fare structures for Uber and Lyft
Uber and Lyft fares work like a traditional taxi, with a fixed minimum fare, and pricing that changes based on time and distance. Three additional things impact the base fare:
- Fare multipliers also called surge pricing, which raise prices in real time based on the supply and demand of drivers and riders. Read about how surge works with Uber.
- Pooled rides where drivers can make multiple pickups and drop-offs in a single route.
- Platform bonuses for drivers who are rewarded with lump sums of money for driving a certain number of hours or trips.
Tip 1: Maximize UberPool and Lyft Shared Saver
The main advantages of pooling riders together are longer rides and less time between trips. Earn a pickup fee for every rider you pick up. The cost is shared between the riders, making it a bit cheaper for them. Drivers are paid for the entire base fare plus the time and distance of the entire route, which means a driver’s fare won’t be negatively impacted if a rider isn’t matched with another rider.
Learn more about how UberPool works, how fares are calculated, and all the extra details like cancellations and ratings.
Learn more about Lyft Shared Saver, how ride pay is calculated, and all the extra details like cancellations and destination changes.
Tip 2: Get paid to sell products
Advertisers love rideshare drivers because they make it easy to get products and messaging in front of people. Here are a few services you can leverage to pull in some extra money each month:
Surf – Add a tablet to the back of your car with music, videos, and advertising. It’s reported to increase tip income, and you get paid when your passengers use the tablet for at least four minutes.
Cirkul – A flavored water bottle company that gives drivers a free water bottle, pays drivers to show the bottle to passengers and have a sign in the car.
Cargo – Get paid to distribute free snacks to passengers.
Each of these products and services are subject to their own respective terms and conditions. Please review the terms and conditions to determine how much you might earn and if you qualify.
Tip 3: Avoid the depreciation and maintenance costs of a car
Not surprisingly, the largest expenses for rideshare drivers are tied to paying, maintaining and gassing a car, whether you own, lease, or rent from a service like Maven Gig, which offers hourly, daily and weekly rentals[link]. However, drivers who rent a car have the advantage of passing the costs of maintenance and depreciation back to most rental companies who foot the bill for these expenses. An MIT study utilizing survey data from Harry the Rideshare Driver found depreciation costs on most cars studied to be below $0.10/mile with the mid-point being closer to $0.05/mile. This is a major expense for drivers who often don’t consider or plan for it. But when you’ve put a lot of miles on your car, and suddenly you need a costly repair, it might not be worth it. So if you aren’t renting, make sure you plan by setting aside money for depreciation.
Tip 4: If possible supplement rideshare work with deliveries and tasks
Working effectively in the gig economy means fewer empty miles, which are miles driven without a passenger or deliveries. Technology can help reduce empty miles and the time you wait between gigs. Gridwise, for example, has a mobile app that shows the length of the line at the airport and the number of arriving flights. The more flights, the higher the passenger demand. Here’s another helpful article[link] about skipping the line at the airport.
All about the profits
This is where the story gets tricky depending on what analysis you’re looking at, and the questions asked drivers to secure certain data. Let’s dive into the studies conducted, and the larger claims made by Uber.
- Uber conducted a study with Alan Krueger of Princeton and found that drivers across 20 of its largest US markets earned an average of $19.04 per hour in October of 2015, not accounting for expenses. A more recent survey with Stanford professors estimated gross hourly earnings of $21.07 for all US drives between January 2015 and March 2017. Again, they weren’t accounting for expenses, but they also didn’t account for the additional services drivers utilize to supplement their earnings.
- The below figures from Gridwise represent earnings after Uber, Lyft and other TNC take their share, and before any expenses (including taxes). Gridwise drivers log tens of thousands of miles per day and track tens of thousands of earnings per week, according to the company:
Earnings Per Hour Median
Earnings Per Mile Median
Earnings Per Trip Median
Los Angeles, CA
New York, NY
New Jersey, NJ
Bay Area, CA
San Jose, CA
San Diego, CA
Las Vegas, NV
Profits are likely to rise when you also participate in package, grocery, and food delivery during down periods for rideshare. Here’s an article with more details about the different types of services you can sign up to drive for. Successful drivers say they earn more when they work strategically to minimize the number of “empty miles,” driving without a fare or delivery. To do this effectively you should regularly monitor different platforms and pick up jobs headed in the similar directions.