WHAT ABOUT ITS DRIVERS?
In its second quarter (for 2023) results published on 01 August 2023, Uber Technologies Inc posted an operating profit of R5,9 billion ($326 million), and the free cash flow of R20,8 billion ($1,4 billion).
Uber attributed this growth in earnings across the board to a “cost discipline” among other factors. The South African Federation of Trade Unions (SAFTU) notes the shortcoming in this explanation, of not accounting for the input costs of the drivers, the real producers of value for Uber Technologies. These profits are raked on the back of these unaccounted capital and operating costs carried by drivers.
This accounting method does not surprise us, however. It emerges out of the business model that Uber and other e-Hailing companies have adopted. It affirms what we posited in our previous statement, that Uber and e-hailing companies do not take liabilities for the input costs of drivers.
The main streams of income flows from freight, delivery, and mobility. These streams of income are provided by the drivers who bring their own cars or scooters, rented or owned. The rising cost of car instalment due to rising interest rates globally, the costs of car maintenance, fuel costs and toll fees, are part of the capital and operating expenditures that are carried by the drivers, not Uber, due to this business model. The implication of this analysis is that Uber Technologies Inc does not factor these capital and operating costs. This is the basis for our argument, that they are raking profits at the expense of the drivers.
e-Hailing drivers, including Uber drivers, who are recruited and organising under SAFTU currently, have testified that they take peanuts home. This is the main reason they wake up too early in the morning and knock off too late in the night. This lengthening of the working day, which may appear at face value to be voluntary, is in actual fact an objective condition created by the little earnings from the rides, which are diminished by the service fees that went into making this profit. Uber servicing fees amounts to 25% of every trip.
SAFTU is calling on Uber Technologies to factor in the capital and operating costs of the drivers in its accounting, and factor them in determining tariff structure for rides on mobility, freight, and delivery.
The best and viable way to do this is to:
- • Immediately reduce the commission fee taken by Uber to increase the earning potential of the drivers, and
- • recognise the drivers as employees and establish a collective bargaining with the trade unions representing these driving workers to decide on tariff structures that are centered on factoring in the capital and operating costs of the drivers.
