Uber vs owning a car – Is Uber cheaper than owning a car?

Uber cheaper than owning a car?

Anyone who owns a car knows that between gas, insurance, and all of the other unexpected fees…a car is an expensive item to own!

But what about possible alternatives…public transportation, biking…

…or…maybe even…’permanent ridesharing‘?

Ditching your Car for Uber – A Crazy Idea?

The advantages of private car ownership are obvious: we all need to get to work; use vehicles for recreation; and run errands.

But…it’s still worth asking: Is there a cheaper, more effective solution in the form of ‘ditching’ your car and permanently ‘ridesharing it‘?

It’s definitely an interesting question (and one that a lot of people are asking).

Over the past half-decade, Rideshare companies have continued to evolve rapidly, meeting the transportation needs of millions of people across the globe. Efficiency and convenience have always been a major selling point of Uber, Lyft and a multitude of other ride hailing companies — but could the option of using rideshare as a ‘regular’ alternative to a car actually be cheaper than vehicle ownership?

Well…based on the trajectory of rideshare titans like Lyft and Uber, such companies certainly want their services to be perceived that way — in other words, they’re angling to become permanent fixtures in people’s lives — cementing themselves as a viable daily transportation option that will (eventually) become cheaper and more commonplace than private vehicle ownership.

So, the big question remains – does it make sense for you to ‘make the switch’ from car ownership to ‘serial Uber user’…and if so, how much money could you save ditching your car and using Uber instead?

Good question!

Is Uber the Cheaper Alternative to Owning a Vehicle?

When posing the perennial question: ‘is ditching my car and using Uber daily actually cheaper than owning a car outright?‘, there are, of course, many complex and intermingling factors that muddy the waters of a clean ‘yes‘ or ‘no‘ answer.

Of course, location is the number one variable in determining the viability of regular rideshare usage (versus private car ownership). If you live in a rural area (as opposed to a densely-populated urban one), it’s easy to see how regular ridesharing may be an inherent challenge (financially, as well as logistically – i.e., there simply aren’t enough ridesharing vehicles available in rural areas…making dependability a critical issue).

Factors to Consider

So, before you decide what’s best for you, ask yourself the following questions:

• Based on my location, what makes more sense? Is Uber readily available where I live?
• When I turn on the Uber App, how many little ‘car icons’ do I see driving around in real-time? What is the ‘driver density’ in my immediate area?

• Now, ask yourself – ‘How much do I spend on my car’? And…be honest! Gas, maintenance, insurance – tally it all up and be ruthless in your calculations!
• Once you’ve factored in all of your fixed vehicle costs (monthly payments, insurance, etc), in addition to all of your other expenses (parking tickets, gas, maintenance, tolls), what does your ownership budget really look like?
• Now, on to the rideshare expenses…
• Ask yourself: How much would I regularly spend on a daily rideshare routine, traveling from Point A to Point B? (Use our cost calculator to find out).
• Similarly, how much would it cost you to get to my workplace daily, extrapolated over the course of a single ‘business month’ (i.e., subtracting weekends)?
• What about regular trips, i.e., going to the local grocery store? Start to crunch some numbers and see what the approximate costs would be.

Overall, based on the available research, it appears that rideshare costs differ severely across the board based primarily on location. With that being said, it appears that owning a vehicle is an ideal option in terms of savings. Extrapolating from findings established by NerdWallet.com, the five cities where you should consider getting rid of your car are:

• Detroit
• Memphis
• Miami
• Providence
• Tampa Bay

In certain cities, the costs of car ownership vs. regular Uber use will be fairly similar (as stated above) — but, at the end of the day, you simply need to take into account your personal situation before knowing (for certain) whether ‘permanent rideshare’ works for you.

You should probably consider getting rid of your car if…

• You have a poor driving record that will significantly influence your insurance, for example, such as a DUI or numerous speeding tickets.

• You currently drive a luxury car (which is too expensive to maintain).

• You’re close to work — to the point where you could either take a short Uber, cycle, or even walk.

You should keep your car if…

• You’re a parent — once you get into all the extra activities and outings, ordering an Uber every time you need to take your kids somewhere would (quickly) turn into a logistical nightmare!

• You have a long commute to work.

• Your area lacks robust Uber of Lyft services.

Cost/Benefit Analysis

In reality, the best option for you will likely differ from someone else.

In some cases, it may be ideal to combine rideshare and private vehicle ownership — in other words, using your vehicle for select situations and rideshare services for other circumstances (such as taking a quick ride to work in order to avoid parking fees).

What you should personally do is a complex question – the first step is to simply begin crunching some numbers based on your needs, and take a cold, hard look at the economics of transportation in your specific geographic location.

New Companies & Emerging Rideshare Opportunities

And – although Uber and Lyft are the two most well-known options – it’s worth looking around at a new crop of emerging ‘carpool’ options.

Especially if you’re looking to get rid of your vehicle, check out other ‘true’ ridesharing and carpooling apps, such as Via or Commutewise – they might be exactly what you’re looking for (i.e., cheaper alternatives to traditional rideshare options like Uber or Lyft, and affordable enough to use on a permanent or routine basis).

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