Uber driver saves over $1,000 monthly with Tesla

Source: Business Insider

Wesley Johnson, 64, uses the income he earns as a San Francisco Uber driver to offer some financial support to his four children and seven grandchildren. He says switching to a Tesla will help him pull in more money over time by reducing costs.

Johnson is semi-retired but told Insider he drives roughly 40 hours per week for Uber — 12 hours Thursday through Saturday and four hours on Sunday. He's brought in more than $50,000 in revenue over the last year, according to documents viewed by Insider. But being a driver also means paying for gas and vehicle maintenance, which can add up and eat into take-home profits.

These extra expenses are why Johnson — who's completed over 19,000 trips since 2014 and has a 4.96 rating — was intrigued when he heard about Uber's partnership with Hertz earlier this year, which would allow him to rent an electric vehicle. He's been driving a long-range Tesla for the past four months and said he thinks it will make his gig work more profitable.

"I'm going to drive this for a few more years at least," he told Insider.

Before switching to an EV, Johnson said he was driving a Mercedes S550, which was costing him $455 per month before he paid off the car in June. He also paid $400 per week — or $1,600 per month — to fill up the gas tank. And while gas prices did fall from peaks, he said it wasn't enough to make a material difference.

To compare, Johnson said the Tesla rental from Hertz costs him roughly $50 per week, or $200 a month, to charge. That's a whopping $1,400 less than it cost to power his Mercedes each month.

Johnson said a single charge — which costs him between $11 and $14 — can last him over 200 miles, and that he typically only has to do it once when he works his 12-hour days. He said he's also taken advantage of another Uber partnership with EVgo, which provides eligible drivers with discounted charging rates. Uber wants all of its North American vehicles to be electric by 2030.

He also cites Uber's zero emissions incentive — which pays him an extra $1 per ride (up to $4,000 per year) until January of 2024 — as a financial incentive for driving electric. He said he typically averages about 120 trips per week, which he views as 120 dollars he can use to put towards his rental payment.

"In my mind, I'm only coming out of pocket like a few hundred dollars a week, plus the charge," he said. "That's how I look at it — I take that money to use towards paying for the car."

Another advantage to Hertz's EV program is drivers who rent through the company face no maintenance costs. Johnson drives so much — by his count, he's logged 45,000 in his EV since March — he prefers not to have to worry about the wear and tear he's putting on his vehicle. He recalls spending thousands of dollars repairing his Mercedes in recent years.

But there's a tradeoff to all these savings. Johnson said he pays $410 per week — $1,640 per month — to rent his long-range EV, significantly more than his Mercedes payment. He also hasn't seen a material difference in revenue from Uber rides since he switched to the Tesla. What he's banking on is the cost cuts in other areas combining in the long run to create a net-positive situation.

"For me, it just makes more sense," Johnson said. "You spend a little more money, but at the end of it, it's less mental stress on you about your car breaking down. Stuff happens."

There's another perk that's made driving the EV worth it for Johnson: he said customer tips have been a bit better since he started driving a Tesla.

"Some people, they like the Tesla, that new Tesla feeling. And they say, 'Oh, my first time riding a Tesla,' stuff like that."

Further, some EV rides also have higher fares, which in theory makes it possible for drivers like Johnson to earn more per ride.

What Uber drivers should know before making the EV switch
Johnson has a few tips for any Uber drivers who are considering renting or buying an EV.

First, he said it's important to establish an optimal charging routine.

Johnson said it's less expensive to charge his car during "off-peak hours," and that he tends to charge his vehicle late in the evening as a result, typically when the car's battery is around 20%.

He said charging takes roughly 40 minutes, and that the lengthy charge time is a big reason he opted for the long-range Tesla. This allows him to charge just once per day — ideally at the end of his workday — and avoid cutting into too much of his driving time.

Second, Johnson said drivers should be conscious of where their trips take them. He tries to avoid trips that take him on the freeway, for instance, because the car's battery declines more quickly the faster he drives.

Third, he said drivers should make sure they're willing to drive consistently. Per his Uber-Hertz rental agreement, Johnson said he has to do a minimum of 30 trips per week to keep the car.

Going forward, Johnson said he plans to keep renting his EV for the foreseeable future. In addition to saving money to support his family, he said he has one other goal in mind.

"I would like to have one of these," he said of the Tesla. "I could cut down that $1,600 rental expense that I pay for it. I put money towards saving for one of these."