The popular ride-share company, Uber has been criticized locally and nationally recently over the alleged mistreatment of passengers and employees. Now, there are new allegations that Uber drivers themselves are being taken for a ride.
Picture this. You need a ride. You contact Uber. Up pulls Uber driver Mark Smith of Dallas in his 2016 Chevy Cruise.
Everything looks fine until he starts to turn that first corner. You hear a grinding and a rattle. You look at your driver and he is gritting his teeth and says, "I guess that's the wheel bearings," Smith nervously admits. "I'm going to drive very slow." Inquisitive passengers who dig a little deeper would then learn the car he or she is riding in has issues. "My mechanic said not to drive it, that's why I haven't been able to drive it or work lately," Smith told us.
And if Smith can't drive, he can't make his car payment of $146 a week. That's right, $146 a week. That's nearly $600 a month, times 12, that's $7,592 a year, for a car, according to Carfax, worth less than $12,000.
We showed Smith's lease to Christopher Kukla with the Center for Responsible Lending. "This is an incredibly expensive transaction for this driver," said Kukla.
He says it's typical of a lot of bad car leases he's seen nationwide. "It's not the best deal for the driver, it's a pretty expensive lease, it's going to be hard to get out of," said Kukla.
And who would sponsor or promote that kind of loan? Uber's own leasing company Xchange Leasing LLC. which has become part of its expanding enterprise. Smith admits he never read the fine print when he signed his lease last year. He says Uber told him he'd make more than enough to cover the weekly payment.
"I feel taken, anybody would," said Smith. "And of course people will say he's dumb, he should have read everything. Like I said, I'm an honest person and I expect the people I deal with to be totally honest with me as well." But Uber has had issues in that department.
Earlier this year, the Federal Trade Commission fined Uber $20-million following allegations that they routinely "exaggerated earning claims and claims about financing through its vehicle solutions program."
That money was supposed to be repaid to drivers like Smith who is stuck driving a lease car that's a lemon.
It's a car that he can't drive or afford to fix and admittedly, a car he had to live in for a few months when he couldn't pay his rent. He says his attempts to get Uber to help him out have been ignored.
"So we're the ones who have to suffer, we're the ones who have to go hungry, we're the ones who have to go homeless," said Smith. "I even told them I've been living in my car. They told me there's nothing they can we can do for you and the guy stood there like this, ready to kick me out."
Uber has declined an on-camera interview and has yet to answer our questions about the mechanics and lease terms of Smith's car.
Uber did respond via email regarding the future of its lease program.
"Uber and the Board have decided that XChange needs to be substantially changed in order to continue providing affordable vehicle options to drivers in a cost effective, sustainable way," said Uber spokesperson Kayla Whaling. "From a business perspective, owning/operating vehicles is very capital-intensive. There are better and less cash-intensive ways to achieve the business objective of getting people in cars which is an option we are committed to continuing to provide."
As for Smith, repairs to his car will cost more than $1,000 and that's money he doesn't have. Besides, he refuses to put passengers at risk.
"But if your car doesn't work and you can't afford to fix it and they won't help you out what are you going to do," asked Smith. "I guess I will just give it back and just ruin my credit. I don't know what else to do."
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