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Ramadan Kareem from the Qatar Living Team. Visit our Ramadan page to stay up to date.

Beware! Uber is a fraud Ponzi company

By Limo-Man

Beware Uber is a fraud Ponzi company defrauding passengers, drivers and trying to destroy Karwa Taxi!

Everybody knows Uber fleeces passengers (also called riders) by charging Surge prices (1.5x,1.9x, 2x ). Every rider has some time been surge-priced. The funny part is surge prices can occur any time of day. Uber can artificially create surge anytime of the day and all Uber drivers know this because they can see surge prices where there are other Karwa taxies and other limousines around. Surge pricing happens almost right round the clock on almost all days near Villagio even if there are many taxies around.

Overall surge prices does not affect passengers much because they are willing to pay whatever the price if they are in a hurry and if they are not in a hurry they are willing to wait till prices drop.

Uber is now trying to destroy local Karwa Taxi business which is one of the cheapest in Qatar. It is to compete with Karwa that Uber droped its prices from QR 15 per ride to QR 10 per ride.

Ponzi company is a company that promises to double your money in 6 months time. But Uber fools its drivers much more than the passengers. For example below is Uber promising the sky to its driver saying to UberGo driver “Earn QR 60 per hour from 6AM to 9AM. Do minimum 3 trips” then comes the curve ball “accept ALL trips”. Then Uber uses this curve ball to disqualify all drivers universally whether they accept ALL rides or not!!!


This is because the maths just do not add up! Its complete Fraud, Fraud, Fraud!

The average Uber ride is QR 12 fare because Doha is a very small area. So if a uber driver does 3 rides the income earned is QR 12 x 3 rides which is Q36! SO HOW CAN UBER PAY QR 180?

People can say that UBER has deep pocket, it may have deep pockets, but UBER doesn’t pay its drivers what it promises. That’s exactly why Uber drivers all over the world are protesting!

A driver in a day can drive and do an average of 2 rides every hour, in 8hours he can do 16 drops. So after 8hrs in which he will cover 250kms and 16 drops he is just able to collect QR200 of which Uber takes away 25% which is complete robbery. So now he is left with QR 150 from which he will have to pay for his fuel (QR15), QR 5 save for maintenance, QR15 carwash & food (QR30) and then he is left with QR90.

What is interesting is UBER makes more profit than the driver OR the car owner without investing in any hardware. Even the Navigation software Uber is using Google Maps which are free for use by open licence. Also UBER is fraudulently basing its profits NOT ON UBER’s operation costs but on the operation cost of the car owner (who has to bear his expenses +car + driver cost +) after investing QR 100,000 in the business.

Uber being only the service provider (connecting the buyer & seller) he can take only 2% or maximum 5% of the fare and from THAT 2% he has to pay 1% as online-service tax to the local government because Uber is earning based on the road infrastructure investment done by the local governemnt.

It is only because people have taken risks and invested in the Taxi business that passengers are able to get rides. Let’s consider the monthly cost of giving a car for Uber rides!

1. Since Uber likes Toyota Camry we will have to purchase it. Say approx QR 100,000

2. Since Uber do not like cars beyond 5yrs and anyhow after 5yrs with Uber the car engine will be completed worn out (456,250kms in 5yrs time at the rate of 250kms per day). We will consider a life of a car until 5yrs.

3. Car loan for expats in Qatar is for 4yrs (48mths) and total interest we will consider QR 10,000 (which is on the lesser side).

4. Monthly Car Loan installment will be QR110,000/48 which amounts to QR 2,291/mth.

5. Full insurance for car will be at QR 300/mth.

6. Petrol cost for riding 250km for 25 days a month is around QR15/day or QR 375/mth.

7. Maintenance cost will be around QR 125/mth.

8. Uber needs clean car inside & outside. So daily 1Wooqod carwash = Qr30 or QR750/mth.

9. Licence/Istimara renewal (cost extra).

10. Driver gets a tiny salary of QR2,000 which is very, very low.

11. Driver needs breakfastQR15 & lunchQR15 food expense QR 750/mth (Or combine no. 10 & 11 as QR2,750).

12. Say the car owner also gets a low profit of QR2,000/mth.

The total (adding 4 to 12) is QR8,591. This is the collection a slightly profitable taxi business earns. Thus this much should be the collection in a month (25days) time. Earning below this will be a loss. On this Uber takes away 25% which amounts to QR2,147! YES! UBER takes away more than what the driver who puts in 200hrs a month and Uber also takes more than the owner of the car who has invested QR 100,000 in the business.

The owner of the car gets only gets QR 6,444 (QR8,591 – QR2,147) which is not sufficient to meet his above mentioned expense.

Now if Uber was to price its business fairly then it should add QR 2,147 to QR8,591 which totals to QR10,738 as monthly collection and divide with the number of rides done as below:

Suppose a driver is able to do 16drops in 8 hours and 400 drops per month (25days) and if Uber is taking 25% fee over the total collection the maths should be QR10,738/400drops. This will give a cost of per drop at QR26. This is considering UBER is able to generate 2 trips per hour for 25 days per driver!

Thus UBER should at no time price its rides below QR 20 for 10kms (QR2 per km) NOR should it surge price its passengers!!! It may use heat map to show where there is more demand but should not surge price!

Such a calculation will also help Karwa Taxi business to survive. They are not perfect but there always needs to be an option!

Any Promotion or Bonus will have to be ABOVE QR 26 or QR 20 at the minimum. Right now Uber is promising QR60 per hour as a ponzi scheme (which is not based on ANY business calculation) and then refuses to pay up. If the diver emails the company they close the case as “solved”.

Beware of Uber if it tells you that by reducing rates from QR20 to QR 10 is more profitable because at the end of the day more people will ride and increased rides will reflect increased profit… it is true for UBER but not for the driver/owner because physically a driver can do maximum of 2 rides per hour or 16 rides per day. Uber is telling him that he will be able to get more than 32 rides in 8 hrs if taxi rates are halved! This is complete bullshit. It is humanly impossible to do even 20 rides in 8 hours without speeding and reckless driving.

Even if you are driving smaller car like corolla the expenses are same. All the expenses other than the cost of the car are almost identical!

Uber is either exploiting people until they get caught or it is some kind of a huge mistake!!!

What is frustrating is Careem too is following Uber strategy in a copy-paste approach! A new Chinese or Indian tech company can come and easily take away their business if it is not done in a sustainable way!

Uber is exploiting technology than using it sustainably!

Ratings calculated automatically using technology developed at QCRI and MIT.

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By britexpat• 1 year 3 months ago.

Is this fact or slander ?

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