Uber, Lyft, and the challenge of transportation startup profits

Transit has always required subsidies – can Uber and Lyft escape history?

How much does transportation cost you?

In most cities, bus or subway fare might set you back $3 or so. A tank of gas, maybe $30 or $40 depending on your car. An hour of street parking? Sometimes it’s free, sometimes it’s a few bucks. And you can usually snag an economy seat on a round-trip U.S. domestic flight for under $300.

These numbers probably ring true for most people. There’s just one problem: Everything you know about the cost of transportation is wrong.

Despite a massive infusion of venture capital into the transportation sector over the past few years, mobility startups are starting to learn what every transportation business has known for generations: transportation profits are elusive, and the system is mainly held together by subsidies. Will this be the first generation of transportation businesses to escape history?

This post was originally posted at http://feedproxy.google.com/~r/Techcrunch/~3/H5Zm8sHnDyQ/.

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