Consider a very simple city model which requires 10,000 cars to meet demand during rush hour (3 morning hours, 3 evening hours) and 4,000 cars to meet demand the rest of the time.

A self-driving model requires the up-front purchase of 10,000 cars, 6,000 of which sit idle 18 hours per day, earning nothing. Meanwhile Uber and Lyft have zero up-front costs, and only pay drivers when the company itself is earning revenue (and presumably, a marginal profit).