Same applies for Lyft. The rides are cheap because of VC money. It is a good thing to have competition to keep the prices in check.

The original comment referred to price gouging due to lack of competition. VC money might subsidize the rides (or more likely find ongoing development?), but Uber and Lyft are bound to be cheaper than taxis for as long as they can remain less entangled with governments (less artificial price inflation).

The problem is that Uber loses money on every ride, so they'll have to raise their rates as soon as they stop being subsidized by VCs -- unless they have self-driving taxis by then.

How are they losing money on each ride? They are not managing fleets of cars, employees, etc. It's an app.

That is exactly the question you should be asking, thank you.

Answer is they provide great rates for passengers - see all of the anecdotal evidence here - and great pay for drivers.

It literally is "too good to be true."

It's just an app--with a $20B valuation and about as much in free cash.

Or they stop investing so heavily in platform development. Without detailed knowledge of their accounts it's hard to predict what might happen when capital shrinks.