Should You Purchase or Lease a Car for Uber & Lyft?

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In this video, we’re going to explore two things—should you buy a car if you don’t have one that fits the requirements, and should you lease or rent a car? Okay? So with Uber, you have an option to lease or rent a car, and with Lyft you can only rent a car. Now, there’s a handful of things. I’m going to use this NerdWallet. NerdWallet is a really great resource. Five ways to get a car to drive for Uber or Lyft. I’m going to use this as a template and show you a couple of things. So let’s look at Lyft first.

Lyft has something called the Express Drive Rental Program. Now, you can sign up with this, and they kinda bring you in, “Don’t own a car? No problem.” You can use the Express Drive Program, and you can rent a car through them, and they have partnerships with different ones. However, something to keep in mind is Express Drive is only available in these following cities.

Okay? So my market, Minneapolis, St. Paul is not in this. So I can’t do that, nor would I. The only reason why I think…and let me just cut to the chase.

The only reason why I think Express Drive or leasing a car or buying a car is good for Uber or Lyft is if you are going to drive full-time. Okay? If you’re going to drive part-time, the money that you’re gonna make is probably not enough to outset it. However, if you’re very good, you may be able to pull it off. If you only drive events and maybe on the weekends and you do quite well, you could pay it off. However, some of these payments can be pretty hefty. Let me show you.

So if you rented with Hertz or Enterprise, you could have things as low as 165 a week. So think about that. If you’re working part-time on the weekends, and you’re doing maybe $400 in a weekend or $500 in a weekend, that can be worth it. And then, the rest of the week, you have a car.

And the cool thing about renting or leasing is that you have that car. All the maintenance of that car is taken care of by these different companies. So you can rent, or you can do Uber’s Xchange program, which is something that they are phasing out. So at the time of you listening to this, watching this video, they may no longer have this. But the very cool situation is that you can just drive that car to the ground. There are no limitations on most of the programs. And so if you’re doing full-time and you want to just go on a binge of driving, this could be a great program. However, they are phasing it out. But I’m sure there’s going to be some other thing that you can get to do that. Also, HyreCar is one that’s not in a lot of markets.

I’m going to keep this link in the notes. But it really comes down to this, if you are not able to drive full-time, I wouldn’t recommend it. And when it comes to just buying a car, you have to consider a lot of things. What I would encourage is a car that’s a few years old, because, number one, the greatest amount of depreciation happens in the first few years. And so, if you start driving rideshare right when you get a car brand new, you’re going to just destroy your value very quickly. So rather, buy a car, save some money that has already depreciated the primary amount, and then drive it to the ground. And another reason why you want to buy a car that’s relatively new is that you’re going to put a lot of work into the car. It’s going to cause a lot of wear and tear, which would cause more maintenance. And if you have a car that is gonna need a lot of maintenance right off the bat, you’re gonna just be spending lots of money in the shop.

So overall, for 2% of people, maybe 2% to 5%, I don’t know, I’m just starting out a random number, it’s a good idea to buy, rent, or lease. But for most of us, not a good idea. However, the only times I would say it’s good is if you have a really good market, really, really, busy, you’re going to work full-time. Or if you’re part-time, you’re going to be very profitable and good. And so maybe a way to dip your toe into it is to rent. Do this Express Drive Rental Program or work with Uber to do one of their renting…Uber has their own renting platform through Hertz, and Enterprise, and, I think, some other companies. Dip your toes and see how good you are and get a feel for it. Use the course and get as good as you can. And if you’re pretty confident about it, go for it.

But here’s my last thing that I want to say, a warning. There’s a lot of drivers back in the heyday when Uber and Lyft first come on to the scene, their rates were a lot higher, and so it was very easy money. Even bad drivers were making good money. And what people did is they got really excited, got their friends in it, and they started leasing or buying these huge cars. So they wanted to do the SUV Black and all these higher-end cars that had really, really, really high rates, and what happened is Uber and Lyft started cutting their rates. And eventually, people started to lose, and they went bankrupt, and some of them are sleeping in their cars now. I mean, this is the tragic, dark side of Uber and Lyft. And the sad thing is Uber and Lyft, you know, cut these rates, and they had every right to. However, these people, they were depending on it. So that was the really sad part. People could push back and say, “Man, this is a new industry. These people shouldn’t have foolishly gone forward and done that.” So there are both sides of the argument.

However, this could happen. They can continue to cut rates. They probably won’t cut rates anymore, because at this point, studies have shown that people are happy to pay at these rates, and the reality is they can’t sustain this model, because they are losing money on every ride. So I would overall say that the rates are going to be in the vicinity that is now or they’ll raise them. And they probably will have to raise them in order to stay alive. So I think you’re safe on that end.

So, hopefully, this was a helpful video, and you kinda have a good idea of if you should do it or not.


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