Uber is a private company so their accounting isn't publicized but as far we can tell, the VC subsidies target a very specific situation: the low prices from competition such as Lyft/Didi
Leaving out the "price wars" aspect, the unsubsidized higher Uber fares would still be lower than:
1) taxis (especially out to the suburbs)
2) the TOC (Total Cost Ownership) of owning a car if consumers make a behavioral change from buying their own car and instead, switch to an on-demand "car as a service". E.g. using Uber 10 to 20 times a month is less than purchase price of car + loan interest + taxes + annual registration + insurance + parking garages.
Similar with number 2, if don't actually know what the subsidy is worth how can you state this?
Keep in mind that Uber isn't subsidizing every fare in every city in all circumstances because even with a $11 billion war chest from VCs, that's unaffordable. They are strategically subsidizing in specific markets (e.g. price wars with Lyft and previously Didi in China).
In the early days (2011?), Uber didn't have heavily subsidized fares and riders still chose them over taxis because they cost less.
My comments are based on observations from analysts, comments from investors Bill Gurley (Benchmark) and the CEO.[1]
[1] http://www.businessinsider.com/uber-says-its-profitable-in-t...
"In February, Uber earned an average of 19¢ per ride in the U.S., according to previously undisclosed financial documents."
You realize that comments from analysts have been hugely wrong before? See Henry Blodgett and Mary Meeker.
Yes they're often wrong but I wasn't talking about predictions. I was talking about how they described the past. Uber was already beating taxis in limited markets without any subsidies.
If I'm interpreting your position correctly, you believe that the only possible way for Uber to be cheaper than taxis is through subsidies. This isn't true.
Financial arbitrage of transportation by using crowd-sourced cars instead of taxis has been discovered by a dozen companies besides Uber. In fact, the opposite tactic of no subsidies and aggressive surge pricing can still be cheaper than taxis.[1] Put another way, Uber (crowd-sourced cars and not the luxury Black Service) without subsidies is by design, cheaper than taxis. What the subsidies attempt do is make Uber cheaper than Lyft/Didi.
The subsidies were part of a competitive strategy to try and bleed Lyft and Didi to death. (It didn't work with Didi and Uber called a truce with them. How Lyft plays out remains to be seen.) However, the subsidies are not necessary for Uber fares to be cheaper than taxis.
[1] http://www.chicagotribune.com/redeye/redeye-ride-share-cabs-...
How were they "beating" taxis? On price? Are you actually beating something if you are cheaper but losing money?
The links you are posting are really fluff pieces. This one is some reporter's anecdotal summary of spot prices for two particular destinations in a single city. This is no way a serious piece of business journalism.
You keep making statements about the specifics and extent of the subsidies but you don't actually know this do you? And none of the links you have posted support these assertions you are making about these subsidies or lack of them.
But the "cheaper" part is largely because rides are being subsidized by VC money no? Is it that meaningful if its not sustainable?