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You are here: Home / Automotive Tech / Uber to MIT: Your Math Is Bogus
Uber to MIT: Your Driver Compensation Math Is Bogus
Uber to MIT: Your Driver Compensation Math Is Bogus
By Levi Sumagaysay Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
If this is the kinder, gentler Uber, it's still pretty scrappy. CEO Dara Khosrowshahi lashed out publicly at a new MIT study that found drivers for ride-hailing services earn about $3.37 an hour after expenses.

"MIT = Mathematically Incompetent Theories (at least as it pertains to ride-sharing)," Khosrowshahi tweeted Friday. He linked to a rebuttal by Uber's chief economist on Medium, which points out that the study released last week by the Massachusetts Institute of Technology differs "markedly" from previous studies about the subject.

The lead author of the study, Stephen Zoepf, who is the executive director of the Center for Automotive Research at Stanford University, then promised to revisit the results.

"I'm re-running the analysis this weekend using Uber's more optimistic assumptions and should have new results and a public response acknowledging the discrepancy by Monday," Zoepf told Reuters.

"Thanks @MIT for listening and revisiting this study and its findings," Uber's CEO tweeted Saturday. "Right thing to do."

Zoepf has not yet returned our request for comment.

The MIT study -- released only in research brief form (PDF) so far -- gleaned from a survey of more than 1,100 drivers and vehicle-cost information that "median profit from driving is $3.37/hour before taxes, and 74 percent of drivers earn less than the minimum wage in their state." It also found that 30 percent of drivers lose money after vehicle expenses are taken into account.

Jonathan Hall, chief economist for Uber, took issue with the study's methodology. The analysis was based on a survey conducted by The Rideshare Guy in 2017, and Hall says the study's authors misinterpreted the questions. Instead, he said ride-hailing drivers' earnings are about $13.04 after expenses.

Uber rival Lyft reportedly said last week that its initial review of the study "shows some questionable assumptions."

In August, Uber hired Khosrowshahi, former chief executive at Expedia, after charges of sexism, sexual harassment and more culminated in the departure of founder and CEO Travis Kalanick last year. The new CEO has tried to revamp the image of the San Francisco-based startup after saying the company was guilty of "hubris" under its old leadership.

© 2018 San Jose Mercury News under contract with NewsEdge/Acquire Media. All rights reserved.

Image credit: Uber; iStock/Artist's concept.

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